BITCOIN Analysis for December 19, 2018

Bitcoin has been quite non-volatile with the bullish gains after breaching above $3,500-600 area recently which is expected to push much higher in the coming days. The price has recently formed Bearish Divergence which is expected to lead to certain pullbacks along the way before the price pushes higher towards $4,000 and later towards $4,250 area in the coming days. The dynamic levels like 20 EMA, Tenkan, and Kijun line have been supporting the price along the way, whereas the break above 200 EMA created a certain upward slope for the indicator as well. As the price remains above $3,500 area with a daily close, the impulsive non-volatile bullish bias is expected to continue further.

SUPPORT: 3,000, 3,350, 3,500-600

RESISTANCE: 4,000, 4,250, 4,500

BIAS: BULLISH

MOMENTUM: NON-VOLATILE

analytics5c1a62154fca7_source!.png

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

EUR/USD: Neutral interest rate in the eurozone may be below zero, UK Inflation Down

The neutral interest rate in the eurozone may be below zero while Inflation in the UK has declined. A report from ECB economists says that the fall in yields on US bonds puts pressure on the US dollar.

The decline in the US bonds yields, as well as the narrowing of the yield spread between the US and German government bonds, continue to put pressure on the US dollar and the EUR/USD pair is growing. If the yield on US government bonds continues to decline, the weakening of the US dollar may continue even further and the US Federal Reserve will signal a less strong tendency to tighten policies after today's increase in the key interest rate.

Next year, the Fed is expected to raise interest rates only twice while in the decline, the forecast came down to at least three increases. The recent fundamental evidence points to the fact that the Central Bank should not rush to raise interest rates in the short term.

Eurozone

An interesting report from economists at the European Central Bank was published today, stating that the neutral interest rate in the eurozone may be below zero. Let me remind you that a neutral interest rate implies a state where there are no signs of both a slowdown in the economy and its additional stimulus to sustain growth.

The report says that the level of the neutral rate may drop even more.

This suggests that since all of the expected increase in interest rates in the euro area by the end of next year will be conducted at a very slow rate. Considering what fundamental data are now being received, it's not at all necessary to talk about more stable prospects for a change in monetary policy. Do not forget about the uncontrollable Brexit, which is approaching like a snowball, as well as about the tension in international trade.

As for the technical picture of the EUR/USD pair, it has not changed significantly compared with the morning forecast, as many traders are waiting for statements from the Federal Reserve System.

Bulls re-updated a large maximum near 1.1400 and are trying to gain a foothold above this level. However, only a delay in the increase of interest rates next year, together with a revision of a number of forecasts for the growth rate of the US economy, will strengthen the position of buyers of risky assets, which will lead to new highs of 1.1450 and 1.1490.

Great Britain

Meanwhile, the British pound is gradually declining against the US dollar. Apparently, the upward potential is gradually limited due to weak inflation data, which did not support the bullish sentiment observed at the beginning of this week.

According to the data of the National Bureau of Statistics of the United Kingdom, inflation slowed down in November of this year, which gives a "respite" to the Bank of England as its rate returned to the acceptable limits set at about 2 percent.

Most recently, the Central Bank announced that it will raise interest rates more than three times, if necessary, in the next few years. This will be done on the condition that prices continue to rise but also on the condition that the UK's exit from the EU will calmly pass and the parliament will approve the Brexit agreement.

According to the data, the annual rate of inflation in the UK was 2.3% in November against 2.4% in October. The main slowdown in price growth was due to lower energy prices. Compared to October of this year, the consumer price index rose by 0.2% in November, which fully coincided with the forecasts of economists.

EvdXPUTs4RFPGzI-95B0usnAvau-rV5Lj2Sp5Xh2

As for the technical picture of the GBP/USD pair, as I noted above, its upward potential is exhausted and the breakdown of the support level of 1.2610 may lead to the formation of a larger downward movement, with the pound instantly returning to the lows of the month by the end of the week. But for this, you need to understand the support levels of 1.2560 and 1.2520.

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

CIBC wants to "save" traders from mistakes in the game with USD/JPY pair

The dollar has all the chances to grow if the Fed meets the market expectations. Such an opinion was voiced today by experts from CIBC World Markets in Tokyo. They also advise traders to be more careful with the USD/JPY pair. According to banking analysts, it is worth refraining from opening positions in this pair in case of a breakthrough up at the beginning of the next year or down from the range of 112-114.

2qkuUVkzvv5lhNjJiUyR1CfjQZJ9s-hyg_Et2nhj

In the end, the American currency will become a preferable choice against the background of still existing concerns about Brexit and around the problems with the budget of Italy. Of course, there is a risk of reducing the pair but the dollar can quickly recover, as the dovish increase in the Fed rates is expected.

This step has already been taken into account by the markets: stocks and bond yields declined on the eve of the US Central Bank meeting. The CIBC believes that regulator officials will exclude the word "gradual" from the final comment. Today they will declare that further tightening of the policy will depend on incoming economic data. Market participants can give a reaction to any change of wording, even the most insignificant one.

The USD/JPY pair broke the lower Ichimoku cloud and the 100-day moving average and continued to fall and reached 112.36, considering the closing levels of 0.6% in New York on Tuesday.

XoNRK12qpwyY147H4yeEyJ2qX891Gkn2yYPzKqEE

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

The dollar stood in standby mode, investors are waiting for the outcome of the Fed meeting

analytics5c1a2d04ad93d_source!.jpg

The dollar is expected to slow down in anticipation of the Fed meeting, at which, as expected, a decision will be made to slow down the rate of increase in interest rates. Global markets subsided before the end of the Fed meeting, which will be the next starting point. The regulator should raise rates for the fourth time this year, as well as voice plans for the future of monetary policy, taking into account the slowing growth of the global economy. How will the dollar behave and will its rise continue amid a pause from the Fed, the trade conflict between the US and China and the volatility of the global financial market? There are quite objective doubts about the fact that the US currency will maintain growth momentum.

Recall that the US President Donald Trump, who has repeatedly stated that "one cannot even think about tightening, given the global economic uncertainty," actively opposes the rate hike. However, the increase is possible, despite the displeasure of Trump, but there is a very high probability that the Central Bank will reduce the number of hikes in 2019 from three to two.2jYli-KczZU1SOwejDBaBKsyWBPIQndpLkCGr-0XCurrently, there is every reason to pay attention to the yen and the Swiss franc, which in such troubled moments will be guaranteed to grow in price. The appetite for risky assets has fallen markedly, including due to weaker-than-expected economic data from China and the eurozone. But the main catalyst for the future movement of the foreign exchange market will be the outcome of the Fed meeting. And they can give a new impetus to the dollar.

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

In 2019, the price of gold is gaining momentum - SP Angel

analytics5c1a453c5bbfa_source!.jpg

According to SP Angel, a commodity trading company, the coming year could be very good for gold. The positive outlook is explained by the potential actions of the US Federal Reserve System (FRS), which may be limited to two increases in interest rates.

SP Angel experts believe that inflation may increase in the United States amid tax cuts and wage increases. This factor will significantly support the price of the yellow metal.

According to experts, in the coming year, the cost of gold has a good chance to grow by $ 100. In SP Angel assume that the maximum rate can be $ 1,275 for 1 ounce. Thanks to investors who are buying the yellow metal in times of decline in price, the precious metal formed the foundation at $ 1208, below which the value of gold is unlikely to fall.

Analysts are confident that the central banks of the world will continue to increase the gold reserves of their states against the backdrop of the volatility of most world currencies. Recall that for regulators, the yellow metal is a tool for diversifying international reserves.

According to the experts of the large American bank JP Morgan, in early 2019, investors cannot rely on the price rally of gold. In the first half of the new year, prices for yellow and white metals will be moderate. The bank's analytical review confirmed the neutral outlook for gold and silver for the first half of next year. JP Morgan believes that the price of precious metals will vary in the range of $ 1,200 to $ 1,250 for 1 ounce. Changes can occur only in the fourth quarter of 2019 when the value of gold soars to the level of $ 1,400.

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

Does gold shine with new brilliance?

ckZrwTXfZUF6_8W0RAv1DMyar412uc4-X1WuWYCW

In the current quarter, gold has risen in price by almost 5%, reaching its highest marks in the last five months.

The increase in the value of the yellow precious metal is due primarily to increased volatility in the stock, bond and commodity markets. In such conditions, investors tend to rush into safe assets.

In addition, it is expected that the US Federal Reserve (Fed) may soften its mindset, it also stirs interest in gold.

Most experts believe that according to the results of the last meeting of this year, the American Central Bank will raise the interest rate by 0.25%. However, the question of what position the regulator will take next year is still open.

If the US economy continues to grow at the same pace, then the Fed will have no reason to continue to move away from the path of tightening monetary policy. In this case, investors may again turn away from gold.

Meanwhile, a slowdown in economic growth in the United States would have forced the Fed not to rush into a rate hike. A more consistent approach by the Central Bank to normalizing the policy would strengthen the position of gold in rivalry with such income generating assets as US Treasury bonds.

If at today's meeting, the regulator signals the continuation of monetary tightening, it will contribute to the growth of the dollar and cause a drop in the gold rate. The "soft" rhetoric of the Fed leadership may lead to a weakening of the "American" and a further increase in the price of the precious metal.

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

Fundamental Analysis of USD/CHF for December 19, 2018

USD/CHF is currently pushing a bit higher after bouncing off the 0.9850-0.9920 area with a daily close which has optimistic structure to push higher as per the preceding trend. Ahead of the release of the FOMC and Federal Funds Rate report today, the pair is expected to be quite volatile while trying to push higher in the process.

This is the fourth time the US Central Bank Federal Reserve increases the interest rate time this year despite the pressure from President Donald Trump. Today, the Fed will probably increase its interest rate to 2.50% from the previous value of 2.25% which is expected to lead to certain gain on the USD side. Though today's rate hike is imminent, but the number of rate hikes in 2019 may be less than expected, which signals certain tightening of the monetary policy due to increased recession fears. Moreover, today, the US Current Account report is going to be published which is expected to decrease to -125B from the previous figure of -101B; Existing Home Sales is estimated to decline to 5.20M from the previous figure of 5.22M; and Crude Oil Inventories is also expected to fall to -2.7M from the previous figure of -1.2M.

On the CHF side, recently, SECO Economic Forecast has had the neutral effect leading to no massive gains or pressure from the CHF side in order to counter the impulsive bullish momentum set by USD. Today, SNB Quarterly Bulletin is going to be held, but with expectation of no major changes in the upcoming economic process. Moreover, tomorrow, the CHF Trade Balance report is going to be published which is expected to decrease to 3.20B from the previous figure of 3.75B.

As of the current scenario, USD is anticipated to gain further momentum against CHF with an imminent rate hike today, while CHF is struggling with the neutral and mixed economic results in the process. Since USD has managed to sustain the momentum for the coming days, further bullish pressure against CHF is expected in this pair.

Now let us look at the technical view. The price has recently formed Bullish Continuous Divergence which is expected to lead the price higher in the process. As the price remains above the 0.9850 area with a daily close, it is likely to push higher towards the 1.0050-1.0130 resistance area in the coming days.

SUPPORT: 0.9850, 0.9920

RESISTANCE: 1.0050, 1.0130

BIAS: BULLISH

MOMENTUM: VOLATILE

analytics5c1a3f7830c3b_source!.png

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

Gold will play on the weaknesses of the Fed

Stock indices and yields on US Treasury bonds are going down, and the dollar is falling. What could be better for gold? Precious metal benefits from a favorable external background and confidently moves up. Futures quotes returned to the five-month highs area and in the case of the "pigeon" rhetoric, the FOMC is ready to continue the rally. Unlike the previous meetings of the FOMC, at which rates were raised, gold is not afraid of the December tightening of monetary policy. Why? It may be the last in this cycle.

Jerome Powell's recent speech on the proximity of current levels of the federal funds rate to the neutral value of the indicator was the first news of a change in the Fed's worldview. The September FOMC predictions suggested three acts of monetary restriction in 2019, as well as the October speech of its chairman. In December, the situation changed. The yield curve is ready to invert, which with a time lag of 9-24 months in the past led to a recession. The real estate market is standing, inflation is slowing down, the state of the manufacturing industry is poor. The weakness of the world economy completes the problems. The dynamics of Chinese retail sales, European business activity, and Japanese foreign trade indicate a decrease in GDP growth in the largest countries.

If the Fed continues to normalize at the same pace, it will strengthen the dollar, which will adversely affect US exports, inflation, and corporate profits. Let US Treasury Secretary Steven Mnuchin say that a strong currency indicates high confidence in the American economy; less than a year ago in Davos, Switzerland, he argued about the beneficial effects of devaluation on foreign trade. The White House took to the practice of practicing verbal interventions. Donald Trump calls on the Fed not to raise rates and stop reducing the balance, and his trade advisor Peter Navarro calls the Central Bank crazy. The ongoing stream of criticism undermines the position of the dollar "bulls" and contributes to the growth of gold.

Dynamics of gold and US dollar4q1sET7oKqaLa3BSJA2D4OZxG0lPSxGYXqd2zUO-However, Citigroup does not believe that the USD index will definitely collapse after the December FOMC meeting. A lot of negatives have already been taken into account, and even if the Central Bank lowers its estimates for the growth in the federal funds rate in 2019, this will not lead to a new wave of US dollar sales. The derivatives market does not believe in one act of monetary restriction next year (the probability of such an outcome is 40%, for the week it fell by 17 percentage points). In my opinion, a change in the worldview of the Fed is the key to the change in the current trends in 2018. Another thing is that this requires a positive from the eurozone, Britain and other major economies. This circumstance allows me to assert that the XAU / USD path will be thorny.

Technically, in the case of updating the December highs in gold, the risks of continuing the rally in the direction of the target by 200% according to the AB = CD pattern will increase. It corresponds to the mark of $ 1290 per ounce.

Gold, the daily chart

VI0oShK9QVcmubB-Uo-8lEG1D1p79ilXkX-xsbvYThe material has been provided by InstaForex Company - www.instaforex.com

GBP / USD pair: plan for the American session on December 19. Pound buyers are not in a hurry to leave the market

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

Pound buyers ignored inflation data, which fully coincided with economists' forecast that led to a slight decrease in the pound in the first half of the day. However, the formation of a false breakdown in the area of 1.2649 may lead to a new upward trend. The main purpose of which will be a breakthrough and consolidation above 1.2696 resistance. Only after that, we can expect a renewal of the highs around 1.2740 and 1.2787, but much will depend on the statements of the Federal Reserve System. In the case of a decrease in the pound, the long positions are best to look at the rebound from the support of 1.2566, since the level of 1.2609 will be only a temporary stop.

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

Pound sellers tried to take advantage of weak inflation data but failed to form a larger fall. At the moment, everything is also required fixing below the support of 1.2649, which will carry a number of stop-order of buyers and lead to a drop in GBP / USD to the support area 1.2609 (first stop) and 1.2566, where I recommend taking profits. If the pair grows in the second half of the day, only false breakdown at 1.2696 will signal to sell the pound. In a different scenario, opening short positions is best to rebound from 1.2740.

Indicator signals:

Moving averages

Trade has moved to the area of 30- and 50-day moving, which indicates the formation of the lateral nature of the market.

Bollinger bands

Bollinger Bands indicator volatility falls, which does not give signals to enter the market.

Video forecast for December 19. What to look for in the Fed statements.

fr-cSlncrUGI80mSPVBVaOdLpmyT8Rw2Y2R3eIAN

Description of indicators

MA (moving average) 50 days - yellow

MA (moving average) 30 days - green

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

Bollinger Bands 20

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

EUR / USD pair: plan for the US session on December 19. Euro may rise significantly after the Fed's decision

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

The demand for the euro remains after a good report of growth on the prices of manufacturers in Germany. Another attempt to consolidate above the resistance level of 1.1401 may form a large upward wave in EUR / USD pair in the second half of the day, which will lead to an update of the highs around 1.1426 and 1.1445, where I recommend taking profits. Fed statements can also trigger a number of purchases. In the event of a decline in the euro, we can consider new long positions up to the Fed's decision, from the level of 1.1368 or buy a rebound from 1.1338.

It is best to open short positions on the euro after returning below the resistance level of 1.1401, which has already been tested for strength several times today. Closing a number of long positions in euros will lead to a larger sale with the update of the day minimum around 1.1368, where I recommend taking profits. f the Fed statements will be positive, we can expect EUR / USD to decline towards larger support levels of 1.1338 and 1.1311 in the short term.

Indicator signals:

Moving averages

Trade is conducted above the 30-day and 50-day average, which indicates continued growth of the euro.

Bollinger bands

If the euro declines in the second half of the day, it is best to return to purchases from the lower limit of the Bollinger Bands indicator around 1.1350.

Video forecast for December 19. What to look for in the Fed statements.

01TH7PFrF1wAg1uNqMpT5maowNgJb_LZGC84dxZ7

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

Fundamental Analysis of AUD/USD for December 19, 2018

AUD/USD has been quite volatile and corrective at the edge of the 0.7200 area, from where it is expected to push lower in the coming days. Ahead of the Federal Funds Rate report and data on the FOMC events today, USD is expected to gain momentum over AUD in the process.

Today, the US Federal Reserve is expected to increase its interest rate to 2.50% from the previous value of 2.25% which is anticipated to result in certain gain on the USD side. Though today's rate hike is imminent, but the number of rate hikes in 2019 may be less than expected, which signals certain tightening of the monetary policy due to heightened concerns about the recession. Moreover, today, the US Current Account report is going to be published which is expected to decrease to -125B from the previous figure of -101B; the Existing Home Sales rate is estimated to decrease to 5.20M from the previous figure of 5.22M; and Crude Oil Inventories is also expected to decrease to -2.7M from the previous figure of -1.2M.

On the other hand, AUD has been struggling with the recent economic reports which has already led the currency to lose certain grounds in the process. Tomorrow, the AUD Employment Change report is going to be published which is expected to decrease to 20.0k from the previous figure of 32.8k, while Unemployment Rate is estimated to be unchanged at 5.0%.

As for the current scenario, the AUD economic reports to be published are expected to be dovish, whereas USD, having higher probability of the rate hike today, is expected to lead to certain gains on the bearish side in this pair. Certain volatility may be observed in the pair, but as per current fundamental aspects, it is likely that USD will put pressure on AUD in the coming days.

Now let us consider from the technical point of view. The price has been residing inside the bearish daily Mother Bar candle since the starting of the week, while residing below the important price area of 0.7200. The price has recently rejected off the 0.7200 area and is pushing lower quite impulsively, which is expected to lead to the 0.7050 support area in the coming days. As the price remains below the 0.7300 area with a daily close, the bearish bias is anticipated to continue.

SUPPORT: 0.7000-50

RESISTANCE: 0.7200, 0.7300

BIAS: BEARISH

MOMENTUM: VOLATILE and CORRECTIVE

analytics5c1a3918cc633_source!.png

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

USD / CAD: all attention is on Canadian inflation

The Canadian dollar repeats the trajectory of oil prices. After a temporary strengthening against the background of the results of the OPEC + summit, a very significant and prolonged decline followed. A barrel of Brent crude oil is currently being traded in the region of $ 56, while the pair of USD / CAD has updated the one and a half year high. Canadians ignore even the weakness of the US currency, which on the eve of the Fed meeting is losing ground in the entire market. Oil "drowns" the Canadian dollar, and today's release of data on inflation in Canada can only accelerate this process.

hQT6UbB5y8qJ3DUwUI8A0tPOSCx1KFr1s4TVk3S7

However, let's start with the "black gold". The barrel of Brent crude oil could not resist within the 60th figure, despite the results of the December OPEC Summit +. The compromise reached was not enough to boost oil prices to $ 70 per barrel. According to most experts, for this, it was necessary to reduce production by 1.7-2 million barrels per day, while the meeting participants decided to converge on a more modest figure - 1.2 million b / c. After a pulse, but very limited growth to $ 62, oil rolled down, with almost no corrective pullbacks.

This dynamic is due to several reasons. First, oil traders are concerned about the clear prospects for an oversupply in the oil market. Recent forward data on commercial stocks in the United States only heightened this concern. In particular, in Cushing, the reserves of "black gold" rose 630,000 at once last week, largely exceeding the expectations of most analysts. The API report also disappointed. The crude oil inventories increased by 3.45 million barrels, gasoline by 1.7 million barrels.

Tonight, data from the US Department of Energy will be published, which is likely to confirm the overall negative trend. According to preliminary estimates, official figures will show an increase in oil reserves by more than 2.5 million barrels. In addition, representatives of the Energy Information Service of the US Department of Energy recently reported that oil production at shale fields in the country will also increase by 134 thousand barrels per day next month, that is, to 8.1 million barrels per day.

In addition to disappointing US statistics, traders are alarmed by the actions of Saudi Arabia and the growth of oil reserves in the PRC. Thus, the Saudis reduced the cost of light oil for Asian countries, while Chinese commercial reserves of "black gold" rose to record levels, thereby reducing overall market demand.

w_HwNvJSqlLvnTmDAVhxt7iuCbfCeAEwJ48nMmJ5

Thus, against the backdrop of an inefficient OPEC deal (which, by the way, will come into effect only next month), in the United States, the level of oil production and reserves only grows. Saudi Arabia and China only complement the negative fundamental picture.

If we talk directly about Canada, in the main oil-producing region of the country, Alberta, they decided to reduce oil production by almost 10% in order to reduce the excess oil reserves, due to which oil prices in Western Canada collapsed to multi-year minimums. This measure will be effective from January until all stocks (35 million barrels) are sold. According to experts, this will happen either in the late spring or early summer.

In other words, the slowdown in Canadian GDP growth (by 0.1%, after a seven-month growth cycle), as well as the vague prospects for the oil market, have lowered traders' hopes of preserving the hawkish attitude of the Canadian regulator. Although at its last meeting, the Bank of Canada announced that the rate is still below the neutral level (that is, the range is 2.5% -3.5%), the regulator still softened the tone of his rhetoric. After a fivefold increase, the Central Bank announced that its further steps would be gradual. This means that the chances of a rate hike in January are minimal, although the market had previously counted on this scenario.

That is why today's data on the growth of Canadian inflation play such a large role in the context of USD / CAD prospects. According to the consensus forecast, the consumer price index will slow down significantly. On a monthly basis, it will return to the negative area again and will decline to 1.8% in annual terms (this is the minimum level since January of this year). If this forecast is confirmed, the pair will receive a new impetus for its growth.

u_lD83nEk0pfanI5L5F8_2vqgJQKaISTmH1fgAO2

Here, it should be noted that it is necessary to make trading decisions on the pair only after the Fed meeting since there is a risk that the US regulator will take a soft stand on its future prospects. In this case, the US dollar will collapse throughout the market, and the loonie will demonstrate a large-scale correction. But if the Fed maintains the status quo, the northern trend will continue with the main goal of 1.3550 (the top line of the Bollinger Bands on the monthly chart).

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

The possibility of the January negotiations between the United States and the People's Republic of China raised shares and

analytics5c1a0bd5d8733_source!.jpg

On Wednesday, December 19, oil prices on Asian trading are beginning to rise gradually after the collapse the previous day. Futures on US stock indexes also show a positive trend against the background of news about the January talks between the leaders of the United States and China.

It is expected that in the first month of the new year, there will be a meeting between American President Donald Trump and the Chinese leader Xi Jinping. According to US Treasury Secretary Steven Mnuchin, they intend to agree on extending the truce in a trade war. Recall that in the current month the deadline for the established fees. At present, both sides are developing a program for the official meeting scheduled for January 2019. Following the meeting, Washington and Beijing expect to document the agreement by March 1 of next year.

WTI light oil futures for January delivery rose 29 cents to $ 46.53 a barrel. At the moment, these contracts are ending, and the closest will be the February contracts, which increased by 20 cents, to $ 46.80 per barrel.

February futures for Brent benchmark crude rose 32 cents to $ 56.58 a barrel. A day earlier, the quotes of this brand fell to $ 55.89, the lowest since October 2017.

According to the data on US foreign trade in October 2018, published last week, the country's trade deficit increased to $ 55.5 billion. Experts consider this figure the highest in the last ten years. At the same time, trade with China reached record levels.

Reducing the trade deficit with China remains a priority for the American president. The White House administration intends to provide American companies with access to the Chinese market. According to S. Mnuchin, if it is possible to agree on this, the trade deficit between the countries will come into balance.

According to analysts, the uncertainty regarding the truce reached between Donald Trump and Xi Jinping at the G20 summit led to instability in financial markets. At the same time, concerns about the slowdown in the Chinese economy have grown substantially.

Since the beginning of this month, the stock index S & P 500 fell by 7%. Experts consider this figure the worst for December, since 1931. Futures on a number of indices, such as the S & P 500, Dow Jones and Nasdaq, began to move upward from Tuesday's lows.

ah4gXzRUipftM1qrkhok3DwWA2gO5BNfn9X6CR71

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

Even a cautious increase in the rate of the Fed may not return calm to the markets

I3Ovt0o0Ghj1YUKJVsvqFN810_KpAqhKYFFzhcjK

Today, the main event for the markets will undoubtedly be the last meeting of the US Federal Reserve System (FRS) this year.

If, relatively recently, most analysts, in fact, were 100% likely to expect the American Central Bank to raise interest rates at the December meeting, now opinions are divided.

Some experts believe that the regulator should refrain from raising rates, having cooled the expectations of markets for further monetary tightening.

As one of the reasons why today's rate increase is called into question, is the fact that the Fed over the past 24 years has never raised the rate during the collapse of stock indices. On the contrary, it usually happened against the background of their growth. Another point, in the previous cycles of tightening monetary policy, in 1999 and 2004, the Central Bank raised the rate only if the market estimated the probability of this step 1 day before the decision was 70% or higher. Now, this figure is at 68%.

According to another point of view, the Fed should not deviate from its plans for tightening next year, because a sharp change in the Central Bank's attitude can finally undermine Jerome Powell's confidence and demonstrate that the regulator can be easily unsettled only by increasing market volatility.

The best option, apparently, is a cautious rate increase, which will weaken expectations regarding the prospects for normalizing monetary policy and show that the Central Bank rate is becoming increasingly dependent on incoming macroeconomic data, as was the case with B. Bernanke and J. Yellen. However, whether such a move can calm the markets is unclear.

As for the US currency, given the pessimistic expectations, the possible weakening of the dollar following the results of the next Fed meeting is likely to be limited. Meanwhile, if the regulator even hints at a rate increase in 2019, albeit at a more modest pace, the "American" may even be somewhat stronger.

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

Fed: The demand for the euro may persist after raising rates in the US. The problem with Italy is solved

The good news that the Italian government has reached an agreement with the European Union, although it supports the euro, however, the upward potential in risky assets will directly depend on the reaction of traders to the statements of the US Federal Reserve.

As it became known, the problem associated with the draft national budget of Italy for 2019, has been resolved. This will allow the Italian authorities to avoid more serious conflict with the trade and political bloc.

Let me remind you that in the autumn of this year, the draft budget of Italy was submitted to the EU, which provided for a budget deficit of 2.4% of GDP. This was contrary to EU rules, which forced the European Union to launch an excessive deficit procedure for Italy and caused investors anxiety.

Fed and interest rates

All attention this afternoon will be riveted to the results of the meeting of the Federal Reserve System, which began yesterday. As most economists expect, the Central Bank will raise the key interest rate to 2.5% from the current 2.25%. However, the Fed may lower its forecasts for the number of rate hikes next year, which will definitely have a negative impact on the short-term growth of the US dollar.

As stated earlier, the Fed leaders at their meeting in September planned three rate increases in 2019 and another one in 2020. However, according to the forecasts of many experts, the Central Bank may limit itself in 2019 to only two increases._Ir20msKVDhKMCuPuRXTCyOst0VW7SAM_BZD3txG

The data, which came out yesterday afternoon, led to the strengthening of the American dollar and the return of some positions paired with the euro and the British pound.

According to a report by the US Department of Commerce, the number of new home bookmarks in the US this November has increased. Thus, the number of bookmarks in November increased immediately by 3.2% compared with the previous month and amounted to 1.256 million homes per year. As for the number of building permits, during the reporting period, it grew by 5.0% compared to October, to 1.328 million homes per year. Economists predicted that the number of bookmarks, on the contrary, would decrease by 0.7%, while the number of permits would fall by 0.2%. Compared with the same period of 2017, the number of bookmarks increased by 5.1%.

As for the technical picture of the EUR / USD currency pair, the upward potential will remain in the first half of the day, which will allow the bulls to renew the large maximum around 1.1400, which will limit the growth of the euro. The only delay in raising rates next year, together with a revision of a number of forecasts for the growth rate of the US economy, will strengthen the position of buyers of risky assets, leading to new highs of 1.1450 and 1.1490.

Canada

The Canadian dollar fell sharply yesterday in tandem with the US dollar after it became known that supplies in the manufacturing sector of Canada declined in October due to a sharp drop in sales of primary metals.

According to the report of the Bureau of Statistics of Canada, sales in the manufacturing sector in October 2018 decreased by 0.1% compared with the previous month and amounted to 58.25 billion Canadian dollars. Economists, by contrast, expected sales to grow by 0.4%.

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

EUR / USD. December 19th. The trading system. "Regression Channels". What will be the rhetoric of the Fed?

4-hour timeframe

4yFZybnOs7SdkUQjRCtsHTKMh6HGWLbormwURpUPTechnical details:

The senior linear regression channel: direction - down.

The junior linear regression channel: direction - down.

Moving average (20; smoothed) - sideways.

CCI: 108.5714

The currency pair EUR / USD on Wednesday, December 19, overcame the moving average line, it is highly expected, however, as we have repeatedly said that the euro's growth potential is limited. Moreover, today we are waiting for the Fed decision on a key rate, as well as comments of the Open Market Committee on monetary policy and a press conference. Definitely, there will be interesting information. At least the markets will be able to understand whether the performance of Jerome Powell, painted in "dove" color, was an accident, or is the Fed really ready to suspend the process of tightening monetary policy? The main intrigue of the day is the question of whether the Fed will raise the rate, given the recent statements by Donald Trump. Recall that in the past two days, Trump strongly put pressure on the Fed and Jerome Powell, saying that it is impossible to raise rates in the current environment. Fed Trump is not subject to, so we believe that the rate will be raised. If so, in the late afternoon, the demand for US currency may increase, but much will also depend on the rhetoric of the Fed representatives at a press conference. From a technical point of view, the pair can continue the upward movement, but, firstly, it will be difficult to break through the level of 1.1414, and, secondly, traders will have to consider the Fed's "pigeon" attitude in the evening, or the Fed should not raise the rate, which unlikely.

Nearest support levels:

S1 - 1.1353

S2 - 1.1292

S3 - 1.1230

Nearest resistance levels:

R1 - 1,1414

R2 - 1.1475

R3 - 1.1536

Trading recommendations:

The EUR / USD currency pair continues to moderately upward. Thus, long positions are now relevant in small volumes with the goal of 1.1414. In the evening, on the eve of the results of the Fed meeting, it is recommended to set short stops for all positions.

Sell positions are recommended to be considered after the price is fixed back below the MA. In this case, the downward movement will be able to continue with the goal of 1.1292, which has already been worked out several times.

In addition to the technical picture, you should also consider 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 younger linear regression channel is the purple lines of the 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

Analysis of EUR / USD Divergences for December 19th. There are no barriers to the growth of the euro

4h

J9VtSmnxkGTfeRtg5jbkDuzXrJXrRTy6xqJYr8TT

The EUR / USD currency pair continues to grow in the direction of the correctional level of 76.4% - 1.1423. Rebounding the pair from the Fibo level of 76.4% will allow traders to count on a turn in favor of the US currency and a slight drop in the direction of the correction level of 100.0% - 1.1303. The ripening divergence on December 19 is not observed. Fixing quotations above the Fibo level of 76.4% will increase the pair's chances for further growth in the direction of the next correction level of 61.8% - 1.1497.

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

Daily

EAE7oDs0MyVaBVBFwaUuVtlyPdclAgOsOMiH1rs1

On the 24-hour chart, the currency pair rebounded from the Fibo level of 127.2% - 1.1285 and a turn in favor of the European currency. As a result, the quotes growth process can be continued in the direction of the next correction level of 100.0% - 1.1553. None of the indicators have ripening divergences. Fixing the pair below the Fibo level of 127.2% will work in favor of the American dollar and will allow us to expect a resumption of the fall in the direction of the correction level of 161.8% - 1.0941.

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 held with the target of 1.1423 and a Stop Loss order below the Fibo level of 100.0% since the pair completed the closure above the level of 1.1303.

Sales of the EUR / USD currency pair can be carried out with the target of 1.1303 with a Stop Loss order above the Fibo level of 76.4% if the pair bounces off the correction level of 1.1423 (hourly chart).

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

Analysis of the GBP / USD Divergences for December 19. The bearish divergence helps the US dollar.

4h

-CGHWdgUob1jacvKo36tvi2SrTryJBzTzItLQMFc

The currency pair GBP / USD on the 4-hour chart completed growth to the correction level of 100.0% - 1.2662. Quoting the quotes on December 19 from the Fibo level of 100.0% will make it possible to expect a reversal in favor of the American currency and a slight drop in the direction of the correction level of 127.2% - 1.2491. There is no indicator of the emerging divergences today. Fixing the pair above the fibo level of 100.0% will work in favor of continuing growth in the direction of the next correction level of 76.4% - 1.2812.

The Fibo grid is built on extremes from August 15, 2018, and September 20, 2018.

1h

rkh8michkKtG-9rTqMBPlWD1VlfG1o9BjP7Wqr-o

On the hourly chart, the currency pair rebounded from the correction level of 100.0% - 1.2696 with the formation of a bearish divergence at the CCI indicator and a turn in favor of the US dollar. As a result, the fall in quotations can be continued in the direction of the correctional level of 127.2% - 1.2566. Fixing the quotations of the pair above the Fibo level of 100.0% can be interpreted as a reversal in favor of the EU currency and we expect a resumption of growth in the direction of the correctional level of 76.4% - 1.2809.

The Fibo grid is built on extremes from October 30, 2018, and November 7, 2018.

Recommendations to traders:

Purchases of the GBP / USD currency pair can be made with a target of 1.2809 and a Stop Loss order below the level of 100.0% if the pair closes above the correction level of 1.2696 (hourly chart).

Sales of the GBP / USD currency pair can be carried out now with a target of 1.2566 and a Stop Loss order above the level of 100.0%, as the pair completed the rebound from the level of 1.2696 (hourly chart) with the formation of a bearish divergence.

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

Simplified wave analysis EUR / CHF for December 19

Large-scale graphics:

The rising wave construction of September 7 has a rather high wave level. The model may give rise to a larger scale trend.

K6G6RzbNg9FYwTn_P2pPFW7o3m_-Lb2c3fsjFxki

Medium scale graphics:

The descending part of the schedule of October 22 achieved its goals both in structure and in price levels. In the TFN4 wave, it took the place of the middle section (B).

7N5jOiW50Z750m_Rtvmq-kZODPH7RkwIVkWnb7SE

Small-scale graphics:

The rise in the rate that began on December 11 has a turning potential. Before the final change of the short-term trend, you need to wait for a decline for a correction.

Forecast and recommendations:

Supporters of trade on large TF before opening long positions should wait for confirmation of a reversal. In the framework of intersessional trade, there is an opportunity to make short-term transactions according to the described algorithm.

Resistance zones:

- 1.1340 / 1.1390

Support areas:

- 1.1230 / 1.1180

Explanations for the figures: The simplified wave analysis uses waves consisting of 3 parts (A – B – C). For analysis, 3 consecutive graphs are used. Each of them analyzes the last, incomplete wave. Zones show calculated areas with the highest probability of reversal. The arrows indicate the wave marking by the method used by the author. The solid background shows the formed structure, the dotted - the expected movement.

Attention: The wave algorithm does not take into account the duration of tool movements over time. To conduct a trade transaction, you need confirmation signals from the trading systems you use!

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

Simplified wave analysis of GBP / USD for December 19

Large-scale graphics:

The main vector of the price movement of the pound since April is directed downwards. The price has reached the upper limit of the large-scale support zone, from which it is worth waiting for oncoming traffic.

lN8BAc9ISNsYJLNDkt_VaV91a3OCJqPfmzNN0cCr

Medium scale graphics:

Starting from November 7, another wave began to form on the chart of the pair in the direction of the main trend. Completed the first part of the structure (A).

tlPf8LwA9fCiuazzcQOGOpTx6HqfVxjs3UZD2lDH

Small-scale graphics:

Rising wave from December 12 at a higher TF forms an intermediate correction. Estimated growth potential is close to completion.

Forecast and recommendations:

Long-term investment in tools is premature. Price entered a zone of high volatility. In the framework of intraday in the coming days will be a relevant sales tool.

Resistance zones:

- 1.2700 / 1.2750

Support areas:

- 1.2500 / 1.2450

Explanations for the figures: The simplified wave analysis uses waves consisting of 3 parts (A – B – C). For analysis, 3 consecutive graphs are used. Each of them analyzes the last, incomplete wave. Zones show calculated areas with the highest probability of reversal. The arrows indicate the wave marking by the method used by the author. The solid background shows the formed structure, the dotted - the expected movement.

Attention: The wave algorithm does not take into account the duration of tool movements over time. To conduct a trade transaction, you need confirmation signals from the trading systems you use!

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

Fed rate decision will impact global markets

Today, the attention of world markets is drawn to the final decision of the Fed on monetary policy, as well as its forecasts on the expected state of the American economy in the new year and interest rate forecasts.

In the past two months, financial markets have increased expectations that, against the background of clear signals of slowing global economic growth, the trade war between the USA and China, as well as the natural weakening of the effect of tax reform adopted by D. Trump after winning the presidential election, will begin to slow down and America's economy, which may force the Fed to pause in raising interest rates.

Against the background of these events and expectations, the American stock market began to be adjusted, which, in our opinion, could turn into a full-scale decline, thus there are real prospects for its transition from the bull market, which was observed from the end of zero, to bearish. The dollar also moved into a phase of consolidation against major currencies, as the resulting uncertainty factor in future prospects holds back its growth. It should also be recognized that the general decline in demand for risky assets, the lack of desire of world central banks to actively raise interest rates help to increase interest in the US currency as an asset safe haven along with the Japanese yen and the Swiss franc. This factor does not allow him to go into a phase of full-scale fall.

Let us return to the possible reaction of the currency market, or rather the dollar, to the Fed's decision on the rates and its estimates of the state of the country's economy and plans for monetary policy. We believe that the likelihood of raising the key interest rate remains high, and it will be increased to 2.50% from 2.25%. This action is unlikely to have a strong impact on the markets, since in general, they have long been taken into account. If the rate is not raised, it will put a strong pressure on the dollar, as well as lowering the forecast for economic growth by the regulator for the next three years. Also a negative for him will be a reduction in the likely number of increases in interest rates from three to two planned in September. This will be a clear signal of a pause in raising borrowing costs at the beginning of the new year.

But if the Fed raises the stakes and at the same time shows confidence that the economy will stand under the pressure of impending adversity, and the previously planned number of rate increases remain, this will be a strong signal to buy the dollar.

Forecast of the day:

The EUR / USD currency pair is trading in the range of 1.1270-1.1460 in anticipation of the outcome of the Fed meeting. If it turns out to be negative for the dollar, the pair may rise to 1.1460, but if the regulator maintains perseverance in the desire to actively raise rates further, this will put pressure on the pair and it may fall to 1.1270.

The USD / JPY currency pair is in the range of 112.30-113.90. The reaction will be similar to the Fed decision, as in the EUR / USD pair. On the positive for the dollar, the pair will rush to 113.90, on the negative after overcoming the mark of 112.30, it may fall to 111.65.

xDhmc1nHaCpwZZ3CuM99U7qRW4txqq9-xfon9iw8

ll3Gdt3aAunAVDCRciHL66ZWVwrEU2RMEJopjfj7

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

Intraday technical levels and trading recommendations for GBP/USD for December 19, 2018

analytics5c1a38390da5b_source!.png

Since Mid-November, Successive Lower Highs were demonstrated below the depicted H4 downtrend line around the price levels of 1.2870 and 1.2780.

Shortly after, a quick bearish decline was demonstrated towards the price level of 1.2500 before bullish recovery could take place on December 12.

A bullish Head & Shoulders pattern is being demonstrated on the H4 chart with neckline located around 1.2660-1.2680. Pattern confirmation projects a bullish target towards 1.2880 again.

On the other hand, the current scenario could pursue as a bearish flag continuation pattern provided that bearish persistence below 1.2660 (corresponding to a prominent daily low) is maintained on a daily basis.

The current bullish pullback towards the price zone of 1.2660-1.2700 can be watched for a valid SELL entry as this price zone corresponds to the backside of the broken consolidation range as well as the depicted downtrend on H4 chart.

Projected target for the bearish flag continuation pattern is located around 1.2300. Initial bearish destination is located around 1.2580 while S/L should be set as daily closure above 1.2800.

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

Intraday technical levels and trading recommendations for EUR/USD for December 19, 2018

analytics5c1a3667620f0_source!.png

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.

On the Daily chart, the pair has been moving sideways with slight bearish tendency. Narrow sideway consolidations have been maintained within the depicted daily movement channel since June 2018.

On November 13, the EUR/USD demonstrated recent bullish recovery around 1.1220-1.1250 where the lower limit of the channel as well as the depicted demand zone came to meet the pair.

Bullish fixation above 1.1420 was needed to enhance further bullish movement towards 1.1520. However, the market has demonstrated significant bearish rejection around 1.1420 few times so far.

The EUR/USD pair remains trapped between the price levels of 1.1420 and 1.1270 until breakout occurs in either direction.

If an early bearish breakout below 1.1270 is achieved on lower timeframes, a quick decline should be expected towards 1.1150-1.1100.

On the other hand, bullish fixation above 1.1420 enhances a further bullish advance towards 1.1520 and 1.1610.

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

Trading Plan 12/19/2018

Trading Plan 12/19/2018

The big picture: The market is waiting for the Fed.

Today, the Fed will publish a decision at 18.00 London time on interest rates e a new forecast for the state of the US economy for the next three years including interest rates, GDP growth, and inflation. The forecast is issued every six months.

The Fed will raise the rate by + 0.25% from 2.0-2.25% to 2.25-2.5% as expected.

However, the market widely expects the Fed to further take a pause in the rate hike.

This will probably be stated in the text of the Fed statement - or it will follow the Fed forecast.

Pound: We are ready to buy the pound from 1.2710.

FHKP7A5iYuCW4WEY0GKgURd7JddNXJBp4uHJczAO

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

What will Powell say?

Today, the Fed Chairman, Jerome Powell, is waiting for a difficult press conference where he will have to be as resourceful as possible. Powell will have to justify a rate hike, recognize a slowdown in economic growth, and at the same time, they were able to convince investors of its strength. In addition, he will change the signals to the market and report a slowdown in the tightening cycle of the policy. At the same time, the head of the Central Bank would most likely prefer to bypass the topic of stopping the folding of QE, although this would help to even out the situation.

rtMlWODOKZCJTd2nDQoQa8zHzRWHFgSAbeksfuGe

A certain drama in the overall tense situation on the market adds an unprecedented criticism of Donald Trump against the Fed. Recall that the head of the White House does not support the position of Powell and considers inappropriate another rate increase in the difficult economic and political time. Such loud and constant criticism puts the Central Bank in an awkward position. In order to preserve its independence from the US president, the regulator will not refuse to increase rates, even if it considers it appropriate.

The Fed will have to demonstrate the same quirkiness as the ECB. Mario Draghi was able to simultaneously note the slowdown in economic growth and at the same time express confidence in growth to be able to continue tightening the policies by curtailing the QE program.

The American regulator partly placed himself in the position in which he is now, as he gave clear signals for a subsequent increase in interest rates. If the financial authorities adhered to the pre-crisis policy with its opacity and mystery, it would hardly have been under Trump's aim.

Powell has already announced that signals to markets will become more vague but it will be difficult to convince investors of this. According to officials of the Federal Reserve, rate decisions always depend on data but they adhered to their own independent of macro statistics forecasts. Inflation is still weak and the Central Bank stubbornly raises the rates, as if prices are confidently rushing forward.

What does the market think?

Now market participants are waiting for worsening forecasts. Instead of three acts of tightening policy, two are expected next year. They also expect that the wording about "gradual normalization" will be replaced by "dependence of the decisions made on incoming data" and preservation of the previous scale of balance reduction. Note that the Fed does not reinvest its revenues from bonds to be redeemed in the amount of $ 50 billion a month. As a result, its assets are reduced, in contrast to the assets of the European and Japanese Central Bank.

Dollar reaction

According to analysts at Citigroup, the American dollar simply cannot fall in price after the FOMC meeting for the simple reason that all the negatives from the Fed pigeon's position are already included in the quotes. The dollar index can significantly go down if the regulator suddenly decides to keep rates at the same level of 2.25%.

9twIjq6aiQxh3LIxgJDpZLHC8ezgJgp5nQtzY5ek

As for the rally of the EUR/USD pair, the growth is due to speculation about the changing worldview of the Fed. If the regulator maintains its previous views, the dollar will immediately recover losses. The actual slowdown in the policy normalization cycle will allow euro fans to rely on early testing of the $1.1445 mark.

-YFE8nTOkm16DXeIh_aBamg_FyrSn-9JYpQywqMp

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

Bitcoin analysis for December 19, 2018

analytics5c1a2ee98f518_source!.png

Trading recommendations:

According to the H1 time frame, I found that BTC had tested the level of $3.765. In addition, there is a breakout of the intraday downward channel, which is a sign that buyers are in control. The short-term trend is bullish. My advice is to watch for buying opportunities. The upward target is set at the price of $4.045.

Support/Resistance

$3.735 – Intraday resistance

$3.640– Intraday support

$4.045 – Objective target

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

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

GBP/USD analysis for December 19, 2018

analytics5c1a2d436b258_source!.png

Recently, the GBP/USD pair has been trading sideways at the price of 1.2630. According to the H4 time frame, I found the breakout of the upward channel, which is a sign that sellers are in control. I also found the false breakout of the resistance at the price of 1.2684, which is a sign that buyers have got trapped. Monitor selling opportunities. The downward target is set at the price of 1.2530.

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

Technical analysis of NZD/USD for December 19, 2018

analytics5c1a295ab2f8d_source!.png

Overview:

The NZD/USD pair broke resistance which turned into strong support at the level of 0.6705 this week. The level of 0.6705 coincides with a golden ratio (61.8% of Fibonacci), which is expected to act as major support today. The Relative Strength Index (RSI) is considered overbought because it is above 70. The RSI is still signaling that the trend is upward as it is still strong above the moving average (100). Besides, note that the pivot point is seen at the point of 0.6882. This suggests the pair will probably go up in coming hours. Accordingly, the market is likely to show signs of a bullish trend. In other words, buy orders are recommended above 0.6800 with the first target at the level of 0.6882. From this point, the pair is likely to begin an ascending movement to the point of 0.6882 and further to the level of 0.6984. The level of 0.6984 will act as strong resistance. On the other hand, if a breakout happens at the support level of 0.6705, then this scenario may become invalidated.

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

Technical analysis of GBP/USD for December 19, 2018

analytics5c1a27e156ff2_source!.png

Overview:

The GBP/USD pair broke resistance at 1.2604 which turned into strong support yesterday. This level coincides with 38.2% of Fibonacci retracement which is expected to act as major support today. Equally important, the RSI is still signaling that the trend is upward, while the moving average (100) is headed to the upside. Accordingly, the bullish outlook remains the same as long as the EMA 100 is pointing to the uptrend. This suggests that the pair will probably go above the daily pivot point (1.2644) in the coming hours. The GBP/USD pair will demonstrate strength following a breakout of the high at 1.2682. Consequently, the market is likely to show signs of a bullish trend. In other words, buy orders are recommended above 1.2644 with the first target at 1.2682. Then, the pair is likely to begin an ascending movement to 1.2682 mark and further to 1.2739 levels. The level of 1.2739 will act as strong resistance, and the double top is already set at 1.2811. On the other hand, the daily strong support is seen at 1.2604. If the GBP/USD pair is able to break out the level of 1.2604, the market will decline further to 1.2557 (daily support 2).

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

EUR/USD analysis for December 19, 2018

analytics5c1a247531592_source!.png

Recently, the EUR/USD pair has been trading upwards. As I expected, the price tested the level of 1.1408. According to the M30 time – frame, I found that EUR/USD is trading above the daily pivot (1.1366) and above the Ichimoku cloud, which is a sign that buyers are in control. I also found a broken double top formation and rising lows on the point and figure chart, which is another sign of strength. My advice is to watch for buying opportunities. The upward targets are set at the price of 1.1430 and at the price of 1.1460.

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

Forecast for EUR / USD pair on December 19, 2018

EUR / USD pair

On Tuesday, speculators against economic data continued to buy back the euro. For the euro area, the data came out worse, but for the United States better; Germany's Ifo business sentiment index for the current month decreased from 102.0 to 101.0, and the number of new housing starts in the USA increased from 1.22 million to 1.26 million in November.

What are the speculators waiting for? They are probably waiting for hints from the Fed to slow down the rate of rate hikes. On the one hand, this is obvious since investors are laying no more than 2 increases in the coming year. They agree on one increase, which is even more profitable since the stock market is already hard to sustain such a pace. However, we must also take into account that the slowdown is also associated with a general weakening of the global economy. Trump's trade wars are basically that. Also, the opposite effect is possible, which is the strengthening of the dollar against the background of the global recession as the withdrawal of investors into a strong asset for a long period of latent recession. It turns out that in the long run, the dollar will strengthen in the long term under the current US policy regardless of the processes taking place in the global economy.

As a result, we are waiting for a decline in the euro to 1.1170 and 1.1080, but before that increased emotional volatility may raise the euro to 1.1460 (MACD line on a daily basis) and, possibly to 1.1621, which was the maximum from October 16. Such a scenario is indicated to us by the output of the signal line of the Marlin oscillator above the upper boundary of the wedge on the daily chart but there can be a fall at once. Even this oscillator line will return to the wedge and the day will close inside the wedge.

peT478P8gtcpLIsJSzJv2xYGMne5wVg-CfiMfzI0

yHvr4o0TQ2Vz_X_6yY22xAgJK4xpMKZ6AlpdEHQB

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

Wave analysis of EUR / USD for December 19. Euro saves growth to 1.1470

analytics5c19f34e25d46_source!.png

Wave counting analysis:

In the course of trading on Tuesday, the EUR / USD pair added a total of about 15 bp. Thus, there is reason to assume that the instrument remains within the framework of the construction of the proposed wave c. If this is true, then the increase in quotes will continue with targets located near the levels of 100.0% and 127.2% Fibonacci. The internal wave structure of this wave already looks quite difficult, but it can become even more complicated. An unsuccessful attempt to break through the minimum of wave b indicates that the pair is ready to rise.

Sales targets:

1.1215 - 0.0% Fibonacci

Shopping goals:

1.1471 - 100.0% Fibonacci

1.1528 - 127.2% Fibonacci

General conclusions and trading recommendations:

The pair remains within the framework of building an upward wave with. A break of 1.1266 (minimum b) will lead to a resumption of the instrument decline with targets located near the mark of 1.1215, which is equal to 0.0% Fibonacci, and below. Until this happens, it is recommended that cautious purchases in small volumes with targets located around 1.1471 and 1.1528.

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

Breaking forecast 12/19/2018

Breaking forecast 12/19/2018

EURUSD: We are waiting for the breakthrough of the range and movement.

Another attempt to start the movement on Tuesday fell through - the euro pierced an important level of 1.1400 to the top - but was thrown back into the range.

Today at 18.00 London time, the Federal Reserve will publish a decision on interest rates and a new forecast on the state of the US economy - perhaps this will give impetus to the market.

We are ready to buy euros from 1.1405, stop 1.1360, target 1.1600.

We are ready to sell from 1.1265.

vLnIttsfaoLn0mVTnbtAkGOy-UaDFaSencIgqrs6

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

Wave analysis of GBP / USD for December 19. The results of the Fed meeting may return the instrument in a downward direction.

analytics5c19f38947a22_source!.png

Wave counting analysis:

In the course of trading on December 18, the GBP / USD pair added about 15 bp more. Thus, wave 5 a, is still considered complete. If this is true, then the increase will continue with targets located near the 100.0% and 76.4% Fibonacci levels, within the framework of the three-wave correction structure (at a minimum). However, an unsuccessful attempt to break through the level of 100.0% also warns of the readiness of the instrument for a new decline. Contribution to the execution of this option may be the Fed meeting and the rate increase or new negative information on Brexit.

Shopping goals:

1.2696 - 100.0% Fibonacci

1.2807 - 76.4% Fibonacci

Sales targets:

1.2564 - 127.2% Fibonacci

1.2398 - 161.8% Fibonacci

General conclusions and trading recommendations:

In conclusion, the pair GBP / USD presumably began to build an upward set of waves while corrective. An unsuccessful attempt to break through 1.2696 may lead to its completion and the construction of a new downward trend. Thus, I recommend buying a tool after a successful attempt to break through the 1.2696 mark with targets located around 1.2807, which corresponds to 76.4% Fibonacci.

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

Indicator analysis. Daily review for December 19, 2018 for the EUR / USD pair

Today, there is a high probability of continuing the top job, but much will depend on strong calendar news, which is to be released at 10 pm and 10.30 pm Moscow time.

Trend analysis (Fig. 1).

On Wednesday, before the news comes out (22.00 Moscow time), there is a high possibility to move up with the first target 1.1403 - the upper fractal.

eurusd-d1-instaforex-companies-group.png

Fig. 1 (daily schedule).

Comprehensive analysis:

- indicator analysis - up;

- Fibonacci levels - neutral;

- volumes - up;

- candlestick analysis is neutral;

- trend analysis - up;

- Bollinger lines - up;

- weekly schedule - up.

General conclusion:

On Wednesday, before the news comes out (22.00 Moscow time), there is a high possibility to move up with the first target 1.1403 - the upper fractal.

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

Technical analysis for EUR/USD for December 19, 2018

EUR/USD is trying to break above 1.14 so far. The chances that the break down below 1.13 was a fake break down have increased dramatically. Strong resistance lies ahead around 1.1430 so bulls need to be cautious.

analytics5c19f41f0cbe5_source!.png

Green line - RSI bullish divergence

Red line - major trend line resistance

Blue line - short-term resistance

Yellow rectangle - major short-term support

EUR/USD has bounced strongly towards 1.14 after revisiting the 1.13-1.1270 area. This bounce is a bullish sign. However nothing has changed yet. Bears remain under control of the medium-term trend as long as price is below 1.1430. EUR/USD has resistance at 1.14-1.1430 and next at 1.15. Support is critical at 1.1270 where we saw a double bottom being formed. Breaking and holding above 1.14 would open the way for a move towards 1.1520-1.16 and higher. Failure to hold above 1.13 will open the way for a move towards 1.11. The longer-term bullish divergence sign in the Daily chart favors the bullish scenario.

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