BITCOIN Analysis for January 22, 2019

Bitcoin has been correcting itself between the corrective price range between $3,500 and $3,600 which recently rejected off the $3,500 support area with strong bullish momentum. The price is currently moving higher towards the Kumo resistance area where the 200 EMA is also holding as dynamic resistance. After the bearish rejection below $3,500, BTC is extending strength above this level amid bullish pressure. A daily close above $3,600 and Kumo Cloud resistance is expected to reinforce upward momentum. As the price remains above $3,000 area with a daily close, the bullish bias is expected to continue further with a target towards $4,000 in the coming days.

SUPPORT: 3,000, 3,500

RESISTANCE: 3,600, 4,000

BIAS: BULLISH

MOMENTUM: VOLATILE

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EUR and GBP: Access to credit in the eurozone will not change in the near future

Fundamental data released on the UK economy in the first half of the day helped the buyers of the British pound, but a more powerful upward momentum was not formed due to the lack of a clear guideline with a further agreement on Brexit. Yesterday, British Prime Minister Theresa May said that Brexit talks would be held without delay, reiterating that there would be no second referendum on this issue.

Good data on wage growth suggests a future increase in costs and growth in retail sales, which will surely support the UK economy.

According to the report of the National Bureau of Statistics of the United Kingdom, the number of employed citizens in the period from September to November 2018 increased by 141,000 compared with the previous three-month period. But the total number of unemployed increased by only 8,000 compared with the previous three-month period. The unemployment rate fell to 4.0%.

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As I noted above, wage growth was 3.4% compared with the same period last year, while economists expected an increase of only 3.3%. The report also noted that the growth rate of wages exceeded the growth rate of prices, while real wages increased by 1.2%.

Today, a report was also published by the National Bureau of Statistics on the net borrowings of the UK public sector, which in December 2018 were at the level of 3 billion British pounds against 2.7 billion pounds in December 2017.

As for the technical picture of the GBPUSD pair, the further growth prospects will depend on the level of 1.2890. If buyers manifest themselves in this range, you can count on a breakthrough of the maximum of 1.2950 with a test of the monthly resistance level of 1.3000.

The European currency continued to trade around the lows of the month, while data from the ZEW Research Institute failed to return to the buyers market.

The poor fundamental data, which has recently been published in the German economy, had a negative impact on the leading report on economic conditions and expectations in Germany.

According to the report, the current conditions index in Germany in January of this year fell to 27.6 points against 45.3 points in December, while the index of economic expectations in Germany in January, on the contrary, rose slightly to -15.0 points against -17, 5 points in December.

A report by the European Central Bank was published today, according to which, in the 4th quarter of 2018, eurozone banks left their policy of approving loans for companies and households unchanged.

From this, we can conclude that at the beginning of 2019 the situation with lending will not change, which will allow us to count on further growth of the economy since it strongly depends on the availability of financing, which is provided from credit resources. The report indicates that representatives of 147 banks surveyed by the ECB expect only a slight tightening of credit conditions in the corporate sector of the eurozone in the 1st quarter of 2019.

As for the technical picture of the currency pair EUR / USD, a breakthrough of the support level of 1.1345 may lead to the formation of a new wave of falling risky assets, reaching 1.1310 and 1.1270 lows.

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Bitcoin analysis for January 22, 2019

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Trading recommendations:

BTC failed to reach the Pitchfork median line, which is a sign that sellers are loosing power and the demand may increase. There is also a breakout of the Pitchfork diagonal (resistance) which is another confirmation of strength. The key support at the price of $3,420 held successfully and I expect further bullish movement. Stochastic is in oversold zone, which confirms potential upward movement. I am bullish as long as there is support at $3,420.

Trading advice: We are bullish on BTC from $3,540 with the targets at $3.742 and $4,086. The protective stop is placed below $3,420.

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

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Analysis of Gold for January 22, 2019

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Gold is expected to move higher towards $1,294.00 (resistance cluster) as long as the support at $1,276.00 is holding. Gold failed to test the Pitchfork median line, which is a sign that selling power decreased. Stochastic is in the oversold zone together with hidden bullish divergence, which adds more potential strength on Gold. Only a break below support at $1,276.00 will change this bullish trading idea and stop us for our bullish view.

Trading recommendation: We will buy Gold on the breakout of the resistance at $1,284.00 with a target at $1,294.00 and protective stop at $1,276.00. Watch for a breakout of resistance before buying.

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Heads of companies around the world expect an economic downturn

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According to a survey by the international consulting company PricewaterhouseCoopers (PwC), about 30% of company heads expect a slowdown in global economic growth over the next 12 months.

Researchers surveyed 1,300 people from all regions of the world. The share of the negative outlook for the global economy grew almost six times over the year (by 5%), which indicates a strong jump in pessimism.

The sentiments of respondents in the United States deteriorated the most, where the share of optimistic forecasts declined compared with last year from 63% to 37%.

The decline in optimism was reflected in plans to expand business outside of their countries. The United States retained its leadership in the list of targeted areas of expansion, while over the year the attractiveness of the American market fell from 46% to 27%. China, which ranks second in the investment attractiveness rating, also showed a decline from 33% to 24%.

CEOs of companies for the development of their business also chose Germany, 13%, India, 8%, Great Britain, 8%.

Only 35% of respondents expressed strong confidence in the growth prospects of their companies in the next 12 months, last year their share was 42%.

The share of Chinese businessmen who are confident in the prospects for business declined from 40% to 35% against the background of a trade conflict with the United States and a weakened industrial sector. Moreover, only 17% of managers chose the American market to expand their business, whereas last year the figure reached 59%.

The confidence of heads of companies in the United States decreased from 52% to 39%, in Germany - from 33% to 20% due to the slowdown in the economy and the problems associated with the release of the UK from the European Union.

88% of respondents who have expressed strong concerns about the prospects for the global economy are most concerned about the problem of the trade confrontation between China and the United States. At the same time, the majority of Chinese businessmen are actively responding: 62% adjust the supply chain and procurement strategy, 58% reorient business development to other countries.

In addition, 85% of company executives expect the emergence of artificial intelligence (AI) technology over the next five years, which will have a major impact on business, with two-thirds believing that it will change the world more than the Internet.

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GBP/USD analysis for January 22, 2019

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GBP/USD is expected to move higher towards 1.3000 (median Pitchfork line) as long as it holds above the upward trendline. There is also a rejection of the lower Pitchfork trendline (support), which is a confirmation of strength. Stochastic is in oversold zone, which adds more potential strength on GBP. Ideally, support at 1.2828 will be able to protect the downside for the next push higher to 1.3000. Only a break below support at 1.2828 will change this bullish trading idea and stop us for being long.

Trading recommendation: We are long GBP/USD from 1.2900 with take profits at 1.3000 and 1.3050. Protective stop order is placed at 1.2830.

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Brent oil becomes cheaper on pessimism about the global economy

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The cost of oil has shifted to a reduction in renewed concerns about a slowdown in the global economy. March futures for Brent fell to the level of $ 61.50 a barrel. The cost of futures for WTI also showed a decline to the level of $ 53 per barrel.

As it became known on the eve, the International Monetary Fund (IMF) worsened its October forecast of global economic growth in 2019 from 3.7% to 3.5%. The forecast for 2020 assumes the growth of the global economy by 3.6%.

The forecast for emerging markets was also lowered (by 0.2%, to 4.5%). In 2020, GDP growth in emerging markets will accelerate to 4.9%. Assessment of economic growth in developed countries was reduced by 0.1%, to 2%. In 2020, similar GDP growth rates were reduced to 1.7%.

Market fears of oversupply disappeared due to the efforts of OPEC + to reduce oil production. Currently, all the attention of markets is drawn to demand, in particular, how much demand will decrease in China and in the world as a whole.

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GBP / USD: plan for the American session on January 22. The data on the growth of average earnings in the UK supported the

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

The pound buyers returned to the market and are trying to gain a foothold above the resistance level of 1.2894 after a good report on the increase in average earnings in the UK and reducing the unemployment rate to 4.0%. The main task for the second half of the day will be to keep the level of 1.2894, which will lead to new purchases by the big players, with the highs around 1.2944 and 1.3006 updated, where I recommend fixing the profits. In the case of a return below the support level of 1.2894, long positions in GBP / USD can be returned to the rebound from 1.2833.

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

Returning the pair to the support level of 1.2894 may lead to the closure of a number of long positions in the pound, which will be a signal to sell to the week low of 1.2833, a breakthrough of which will lead to a new downtrend with the prospect of a decline to 1.2752 and 1.2679, where I recommend fixing the profits. In the case of an uptrend on the news in the US, it is best to consider short positions from the highs around 1.2944, subject to the formation of a false breakdown, or to rebound from 1.3006.

Indicator signals:

Moving Averages

Trade is conducted in the area of 30-day and 50-day moving, which indicates the lateral nature of the market.

Bollinger bands

Volatility remains low, which does not give signals to enter the market.

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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: plan for the American session on January 22. The euro buyers have managed to maintain an important level of support.

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

In the first half of the day, buyers managed to keep an important level of support around 1.1348, and the formation of a false breakdown on it, which I paid attention to in my morning forecast, preserves the likelihood of continuing upward correction in euro. The main objective remains the breakthrough of the resistance level of 1.1388, which will lead to a larger upward correction in the region of the maximum of 1.1423 and 1.1451, where I recommend fixing the profits. In the event of a further decline in the euro with the trend, it is best to look at the long positions after a test of support at the low of this year in the area of 1.1312.

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

The sellers showed themselves in the morning and tried to break through the support of 1.1348, but this did not bring any results. The task for the second half of the day is to re-lower to the area of 1.1348, which will lead to a larger EUR / USD sale with a minimum of 1.1312 and 1.1272, where I recommend fixing the profits. In the case of a return scenario above the resistance of 1.1388, against the background of weak statistics in the US, I recommend to consider short positions in euro for a rebound from the upper border of the side channel last week around 1.1423.

Indicator signals:

Moving Averages

Trade is conducted below the 30-day and 50-medium moving, which indicates the bearish nature of the market.

Bollinger bands

The volatility of the Bollinger Bands indicator is low, which does not give signals to enter the market.

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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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Intraday technical levels and trading recommendations for GBP/USD for January 22, 2019

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On December 12, the previously-dominating bearish momentum came to an end when the GBP/USD pair visited the price levels of 1.2500 where the backside of the broken daily uptrend was located.

Since then, the current bullish swing has been taking place. Recent bullish spike reached the price level of 1.2999 where significant bearish rejection was demonstrated (Bearish Engulfing candlestick around the downtrend line).

This probably pauses the bullish scenario for a while, allowing sometime for bearish correction towards 1.2800 where confluence of demand levels as well as the H4 up-trend line come to meet the pair.

For the bullish scenario to remain valid, bullish persistence above the price level of 1.2800 should be maintained on a daily basis. Bullish breakout above 1.3000 will be needed to enhance further advancement towards 1.3130-1.3180.

Otherwise, any bearish decline below 1.2800 invalidates the bullish scenario bringing the GBP/USD pair again into sideway consolidations that may extend down towards 1.2710 (Next demand level to meet the pair).

Trade Recommendations:

Conservative traders can wait for bearish pullback towards 1.2800 (short-term uptrend in BLUE) for a valid BUY entry.

T/P levels to be located around 1.2870, 1.2920 and 1.3000. Any bearish H4 closure below 1.2790 invalidates this scenario.

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Intraday technical levels and trading recommendations for EUR/USD for January 22, 2019

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Since June 2018, the EUR/USD pair has been moving sideways with slight bearish tendency. Narrow sideway consolidations have been maintained within the depicted Flag Channel (In red).

On November 13, the EUR/USD demonstrated recent bullish recovery around 1.1220-1.1250 where the current bullish movement above the depicted short-term uptrend (In blue) was initiated.

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.

This renders the recent bullish breakout above 1.1420 and 1.1520 as a false breakout. Hence, any bullish pullback towards 1.1420 can be considered as a valid SELL entry for intraday traders.

The current bearish consolidations below the key-level of 1.1400 encourages more bearish decline down to 1.1250 as Initial target provided that the minor uptrend line located around 1.1350 gets broken to the downside early.

Trade Recommendations:

Conservative traders can wait for bearish breakdown below 1.1350 (short-term uptrend in BLUE) as a valid SELL entry.

T/P levels to be located around 1.1310, 1.1270 and 1.1225. S/L to be located above 1.1420.

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What will surprise the Bank of Japan, the US Federal Reserve, the ECB, and the British Parliament?

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The yen, which is a safe haven currency, unlike other major currencies, remains stable against the dollar, and this trend is likely to continue. It is expected that the Bank of Japan will leave its policy unchanged at a meeting on January 22-23. Overall, monetary policy in Japan will remain very favorable this year. The only thing is that the slowdown in the global economy and the decline in oil prices may make the Central Bank reconsider its forecasts for economic growth and inflation, but not to such an extent as to talk about changes in monetary policy.

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The dollar may also be in a similar situation, the weakening momentum in the global economy forces the Fed to cautiously approach any further interest rate increase, and more and more factors suggest that the regulator can stop the policy tightening cycle altogether, leaving it unchanged. This will inevitably lead to a weakening dollar, which is currently overbought and overvalued according to fundamental indicators.

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The pound continues to keep in a narrow range. Since in London, there is no agreement on how and, in general, whether the largest union in the world should leave. In addition, the likelihood of abandoning the transaction is growing, and a way out is possible without any conditions that could alleviate the economic shock. The euro is likely to remain under pressure as economic growth in Europe, including Germany and France, weakens, while inflation remains low.

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Brent pulled off the bat

After losing 40% of its value at the end of 2018, oil managed to be noted as the best start in the last 18 years, quickly flying up to an 8-week maximum amid a reduction in deliveries by OPEC and other producing countries by 1.2 million b / d ending the US and Celestial trade wars and reducing the number of rigs from Baker Hughes in the United States to 8 months bottom at 852. The potential for increasing US production from current record levels looks limited, while a gradual improvement in global demand can push Brent and WTI into higher. But the "bulls" in the arsenal have such trump cards as geopolitics and the weakness of the US dollar.

According to OPEC forecasts, the extraction of black gold outside the cartel in 2019 will grow by 2.1 million b / d, on average to 64.2 million b / d. World oil demand will increase by 1.3 million b / d, to 101 million b / d. Thus, the current cut will be quite enough to balance the market. The problem is one. As events of 2018 have shown, the rise in prices for the North Sea variety above $ 65 per barrel leads to a significant increase in shale production in the States. This mark is critical and the bulls are in no hurry to build up long positions. The increase in net-longs is mainly due to the reduction of short.

There are questions to global demand. In December, China rewrote a record of oil imports (more than 10 million b / s), but the first drop in car sales by 2.8% y / y over the past two decades, real estate market problems (construction is a key consumer of diesel in China) and pessimistic forecasts for oil products (according to China National Petroleum estimates, interest in diesel fuel for the first time since 1990 will decrease by 1.1% in 2019) suggests a slowdown in the indicator.

Dynamics of Chinese foreign trade in oil and oil products

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Not add optimism to fans of black gold, the second in the past six months, the reduction of forecasts for the global economy by the IMF and the least rapid growth in China's GDP over the past three decades. According to the International Monetary Fund, we expect a slowdown to 3.5%, the main contribution to which will be made by developed countries. The growth rates of their economies will decline from 2.3% to 2% in 2019 and to 1.7% in 2020.

On the side of the "bulls" by Brent and WTI are playing geopolitics and the potential weakening of the US dollar. Despite some stabilization of the situation in Iran, Libya, Nigeria, and Venezuela, these countries are able at any time to remind themselves of a reduction in production and (or) exports. The "American" does not yet feel the consequences of a pause in the process of normalizing the Fed's monetary policy due to the weakness of the competing currencies. In particular, the euro can not come because of Brexit and a portion of disappointing statistics on industrial production, business activity, and inflation.

Technically, on the daily chart of Brent, the transformation of the Shark pattern in 5-0 continues. Within its framework, a correction takes place in the direction of 38.2% and 50% of the CD wave. The rebound from these resistance levels is usually used for sales.

Brent, the daily chart

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Technical analysis of AUD/USD for January 22, 2019

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Overview:

Pivot point: 0.7112.

The AUD/USD pair is set above strong support at the level of 0.7046 which coincides with the 23.6% Fibonacci retracement level. This support has been rejected four times confirming the veracity of the uptrend. Hence, major support is seen at the level of 0.7046, because the trend is still showing strength above it. Accordingly, the pair is still in the uptrend in the area of 0.7046 and 0.7168. The AUD/USD pair is trading in the bullish trend from the last support line of 0.7112 towards the first resistance level of 0.7168 in order to test it. This is confirmed by the RSI indicator signaling that we are still in the bullish trending market. Now, the pair is likely to begin an ascending movement to the point of 0.7168 and further to the level of 0.7219. The level of 0.7389 will act as major resistance and the double top is already set at the point of 0.7389. At the same time, if there is a breakout at the support levels of 0.7112 and 0.7046, this scenario may be invalidated. Overall, however, we still prefer the bullish scenario.

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How much is the dollar overvalued or does it still have room to grow?

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The dollar was at a level of almost three weeks high on Tuesday, investors are attracted by the relative safety of the US currency after the International Monetary Fund reduced its forecasts for the global economy in 2019 and 2020.

However, despite the confident start of the year, there is a reason to believe that the dollar may be overvalued against the background of weaker competitors, and if the European Central Bank signals a hardening of monetary policy, the situation may change dramatically. In addition, the dollar may also be under pressure due to problems associated with the closure of the US government, which is already beginning to put pressure on domestic growth. Morgan Stanley expects the US economy to grow in the first quarter is likely to fall below their forecast - 2.2 percent year on year, which is about half as much as 4.2 percent in 2018. The IMF has reduced its growth forecasts for 2019 and 2020 due to weakness in Europe and in some emerging markets. He also said that the inability to resolve trade conflicts could further destabilize the world economy.

While the dollar feels very good. External factors that have a direct impact on the foreign exchange market are currently very unstable. It is difficult to predict how the next round of negotiations between the US and China will end, will it be a reason for a summit meeting and how will it be? How will consumers and producers in Europe, especially exporters, behave? What will show data on corporate profits in the US? Too many questions and the answer to each of them can cause the dollar to fall.

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Technical analysis of USD/CHF for January 22, 2019

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Overview:

The USD/CHF pair faced resistance at the level of 1.0031, while minor resistance is seen at 0.9987. Support is found at the levels of 0.9884 and 0.9819.

Also, it should be noted that a daily pivot point has already set at the level of 0.9939. Equally important, the USD/CHF pair is still moving around the key level at 0.9939, which represents a daily pivot in the H1 time frame at the moment.

Yesterday, the USD/CHF pair continued to move upwards from the level of 0.9939. The pair rose from the level of 0.9939(this level of 0.9939 coincides with the double bottom) to the top around 0.9987. In consequence, the USD/CHF pair broke resistance, which turned strong support at the level of 0.9884. The level of 0.9884 is expected to act as major support today. From this point, we expect the USD/CHF pair to continue moving in the bullish trend from the support level of 0.9884 towards the target level of 0.9987. If the pair succeeds in passing through the level of 0.9987, the market will indicate the bullish opportunity above the level of 0.9987 in order to reach the second target at 1.0031. However, if a breakout happens at the support level of 0.9819, then this scenario may be invalidated.

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GBP / USD: pound keeps growth potential

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While some experts believe that after the failure of the British parliament's Brexit plan, promoted by Prime Minister Theresa May, the chances for the United Kingdom to leave the European Union significantly increased, others argued that the recent defeat of the head of the government referendum.

As for T. May herself, announcing yesterday the further steps of the Cabinet of Ministers on Brexit, she allowed the possibility of revising the parameters of the "divorce" agreement, specifying that she does not support the idea of organizing a repeated referendum. She also spoke against the extension of Article 50 of the Lisbon Treaty. According to her, this will only delay, but will not exclude the option of a British exit from the union without a deal.

Voting on the so-called "plan B" with all the amendments made should be held in the House of Commons on January 29.

Thus, on the table are still options as a "hard" and "soft" Brexit. In addition, the likelihood of British membership in the EU is not excluded. The further dynamics of the pound sterling will depend on the direction in which the scale will swing.

According to a consensus forecast of analysts polled recently by Bloomberg, by the end of this year, the British currency may strengthen against the dollar by more than 5%, to $ 1.36.

"The events of the last week point to either a later, or a more "soft" Brexit, or even, perhaps, a rejection of it," said Goldman Sachs currency strategists.

"Despite the fact that the uncertainty around Brexit persists, we believe that this year the pound will be the growth leader among the G10 currencies," they added.

In this scenario, the Bank of England is likely to resume the cycle of tightening monetary policy, and the difference in interest rates amid a possible pause the Fed will play into the hands of the "bulls" on GBP / USD.

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Simplified wave analysis of #USDX (US Dollar Index) for January 22

Large-scale graphics:

The vector of movement of the dollar since February last year is set by a wave of a bullish trend. In the structure of the wave, the conditions for the final breakthrough (C) are prepared.

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Medium scale graphics:

The descending wave of November 13 took the place of correction in a larger wave model. The dollar has reached strong support, the structure is formed. With a high degree of probability, the wave is complete.

Small-scale graphics:

The ascending segment, which began on January 10, has a reversal potential. In the near future, this movement will move to a higher scale. Kickbacks are likely to be flat.

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Forecast and recommendations:

The graph shows a change in the direction of the short-term trend of the index. In the coming weeks, the dollar will be strengthened, after which the downward phase will follow. This time will be the most successful for opening deals awaiting the weakening of the national currencies.

Resistance zones:

- 96.90 / 97.10

Support areas:

- 96.10 / 95.90

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 requires confirming signals of the trading systems you use!

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Brexit: Theresa May is preparing a series of changes to the new Brexit agreement. The euro remains under pressure against

The euro yesterday continued to decline in tandem with the US dollar after the release of a weak report on producer prices in Germany, which fell sharply at the end of last year.

According to the report, the producer price index in Germany in December 2018 fell by 0.4% compared with November, while on an annualized basis grew by only 2.7%. Economists had expected prices to fall by only 0.1%.

As noted in the report, the main decline was due to energy prices, which significantly subsided by the end of the year.

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The report of the German Bundesbank yesterday did not greatly delight investors. The bank expects the German economy to avoid a recession at the end of 2018, but in the 4th quarter it showed a fairly moderate growth. All the reason is the disappointing situation in the industry, which has seriously suffered due to trade sanctions.

The speech of the managing director of the International Monetary Fund, Christine Lagarde, was also ignored by investors. Lagarde spoke at the World Economic Forum in Davos, which was refused to go by US President Donald Trump and key European leaders because of internal problems.

According to Christine Lagarde, the global economy is facing significantly higher risks than before. However, the global recession is not a matter of the near future, even though the risk of a more severe slowdown in global economic growth has certainly grown.

The main risks that exert pressure on the global economy, the head of the IMF Lagarde took last year's fees, which damaged asset prices and tightened financial conditions.

Immediately after her speech, a report from the IMF was published, in which the fund lowered its forecast for global growth in 2019 to 3.5% against 3.7%, which were expected as early as October 2018 and against 3.9% expected in July The IMF called economic growth weaker than previously expected.

As for the technical picture of the currency pair EUR / USD, it remained unchanged compared with yesterday's forecast.

It is expected that the pressure on risky assets may continue at the beginning of this week, but the bears will need to keep the pair below the resistance level of 1.1390. Yesterday's unsuccessful attempt to return to this range formed the next wave of euro sales, and now the main task is to update larger minima around 1.1340 and 1.1310. If the bulls are quickly rehabilitated after yesterday's fall, the level of 1.1420 will act as a large resistance, above which it was not possible to break through last week.

Brexit

The British pound rose slightly after Prime Minister Theresa May said yesterday that negotiations on Brexit would be held without delay, reiterating that there would be no second referendum on this issue. May once again noted that the main issue remains the Irish border and the changes will be associated with it. The British Prime Minister also said that she would give Parliament more freedom regarding the future trade agreement with the EU. An important change in the new agreement on Brexit may also be an amendment that will guarantee the rights of workers after Brexit.

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Simplified wave analysis of EUR / GBP for January 22

Large-scale graphics:

The last wave construction that is currently relevant is ascending, starting from April of last year. The final part (C) is formed in the wave.

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Medium scale graphics:

The downward wave of October 12 in a larger design corrects the trend section.

Small-scale graphics:

A wave of January 3 completes the model of the senior TF. The price has reached strong support of large scale, while the structure of the movement looks formed. Signals fast change course is not observed.

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Forecast and recommendations:

Sales may be risky due to the small stroke potential. In the nearest weekly period, conditions may arise for a change in the short-term trend of the trend. No conditions for purchases. It is recommended to refrain from trading until clear reversal signals appear.

Resistance zones:

- 0.8930 / 0.8980

Support areas:

- 0.8770 / 0.8720

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 requires confirming signals of the trading systems you use!

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

GBP / USD. January 22. The trading system. "Regression Channels". Theresa May's brilliant Plan B

4-hour timeframe

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Technical details:

The senior linear regression channel: direction - down.

The younger linear regression channel: direction - up.

Moving average (20; smoothed) - sideways.

CCI: -14.5085

The currency pair GBP / USD on Tuesday, January 22, was fixed for a short time below the MA, but has already managed to return to the area above this line. Yesterday, Theresa May presented her plan "B" for Brexit in the British Parliament. It was hard to even imagine what exactly the prime minister would offer. And Ms. May suggested new negotiations with Brussels on the Northern Ireland border. Thus, her plan for new negotiations with the EU must now be approved by parliamentarians, after which May will go to these same negotiations. How May intends to negotiate with European leaders, given the fact that they have repeatedly stated that London is provided with the best conditions for getting out of all possible, is unknown. One way or another, it looks like there will be new negotiations with the EU, but all this now seems like a banal clinging to a drowning man in a straw. The leader of the Labor Party's opposition party, Jeremy Corbyn, has already said that May simply refuses to recognize the real situation around her Brexit plan. Theresa May also managed to declare that she opposes the second referendum, as well as against the postponement of leaving the EU. Today, the UK will publish reports on wages for November, unemployment rate and applications for unemployment benefits for December.

Nearest support levels:

S1 - 1.2848

S2 - 1.2817

S3 - 1.2787

Nearest resistance levels:

R1 - 1.2878

R2 - 1.2909

R3 - 1.2939

Trading recommendations:

The currency pair GBP / USD continues to be in the correction. Thus, it will be possible to open long positions in the case of the color of 1-2 bars with the Heikin Ashi indicator in purple with targets of 1.2939 and 1.3000.

Sell positions will become relevant no earlier than price fixing below the moving average line. The initiative, in this case, will pass into the hands of bears, and the first target for the downward movement will be the level of 1.2817.

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

CCI is the blue line in the indicator regression window.

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

Murray levels - multi-colored horizontal stripes.

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

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EUR / USD. January 22. The trading system. "Regression Channels". Volatility dropped to lows

4-hour timeframe

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Technical details:

The senior linear regression channel: direction - up.

The younger linear regression channel: direction - up.

Moving average (20; smoothed) - down.

CCI: -149.2824

On Tuesday, January 22, the currency pair EUR / USD continues a weak downward movement amid the complete absence of any important macroeconomic information from the European Union or the States. In America now everything is simple: "Shutdown" continues, Trump is trying to knock out money to build a wall on the border with Mexico, macroeconomic reports are not published. The European Union is also in a certain hibernation, the main political and economic events take place in the UK, and the whole world is now watching this country. This explains the low volatility in recent days for the analyzed instrument. To date, no important publications have been scheduled in the European Union again. Thus, we should not expect an increase in volatility today. Information from the British Parliament now also has no effect on the EUR / USD pair. Based on this, traders can only rely on technical factors. A certain part of traders is now completely out of the market, which can be seen in the trading volumes. The Heikin Ashi indicator often signals a possible beginning of a correction, which ultimately does not start. In such conditions, the best option would be to remain outside the market for some time, simply waiting for the restoration of the previous levels of volatility.

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 currency pair EUR / USD continues the weakest movement down. A rebound from the level of 1.1353 warns of a possible correction for the purpose of the MA. Therefore, it is recommended to open new short positions after its completion or in the case of overcoming the level of 1.1353, but not forgetting that the volatility is now extremely low.

Buy orders will become relevant for the purpose of 1.1475, if the bulls manage to overcome the moving average line. In this case, the tool initiative will go into the hands of the bulls for a while.

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 the divergence of EUR / USD for January 22. The level of 1.1360 with great difficulty keeps the pair from falling

4h

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The currency pair EUR / USD, despite the formation of two bullish divergences, the coming third and the rebound from the correction level of 23.6% - 1.1358, continues to hold near this Fibo level. A new rebound from the level of 23.6% or the formation of a bullish divergence at the MACD indicator will allow traders to count on a turn in favor of the EU currency and some growth in the direction of the Fibo level of 38.2% - 1.1446. Closing the pair below the correction level of 23.6% will increase the chances for the fall to continue in the direction of 1.1269.

The Fibo grid is built on extremes from September 24, 2018, and November 12, 2018.

Daily

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On the 24-hour chart, the fall in quotations continues in the direction of the correctional level of 127.2% - 1.1285. Resetting the pair from this level will allow traders to expect a reversal in favor of the European currency and the beginning of growth towards the correction level of 100.0% - 1.1553. Fixing quotes below the Fibo level of 127.2% will make it possible to count on a further fall in the direction of the next 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 currency pair EUR / USD can be made with the target of 1.1446 and a Stop Loss order under the level of 23.6% if the pair performs a new rebound from the correction level of 1.1358, especially in conjunction with bullish divergence.

Sales of the currency pair EUR / USD can be carried out with the target of 1.1269 with a Stop Loss order above the Fibo level of 23.6%, if the pair consolidates below the level of 1.1358.

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Analysis of the GBP / USD Divergences for January 22. The bearish divergence predicts a new fall

4h

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The currency pair GBP / USD on the 4-hour chart completed closing above the correction level of 50.0% - 1.2869, which allows us to expect some growth in the direction of the Fibo level of 61.8% - 1.2970. The ripening divergences on January 22 are not observed in any indicator. Fixing the pair under the Fibo level of 50.0% will work in favor of the American dollar and resuming the fall in the direction of the correction level of 38.2% - 1.2765. The bearish hourly divergence supports this option.

The Fibo grid is built on extremes from September 20, 2018, and January 3, 2019.

1h

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On the hourly chart, the quotes of the pair completed growth to the level of correction of 127.2% - 1.2916, but the bearish divergence at the CCI indicator worked in favor of the US dollar and resuming the fall in the direction of the correctional level of 100.0% - 1.2815. Fixing quotations above the Fibo level of 127.2% can be interpreted as a reversal in favor of the British currency and we expect a resumption of growth in the direction of the correction level of 161.8% - 1.3049.

The Fibo grid is built on extremes from December 31, 2018, and January 3, 2019.

Recommendations to traders:

Purchases of the currency pair GBP / USD can be made with the target of 1.3049 and a Stop Loss order below the level of 127.2% if the pair closes above the level of 1.2916 (hourly chart).

Sales of the currency pair GBP / USD can be carried out now with a target of 1.2815 and a Stop Loss order above the level of 127.2%, since a bearish divergence has formed (hourly chart).

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A delicate balance has been established on the market

After the New Year rally in world markets in the wake of clear signals of a slowdown in economic growth in China, as well as the uncertainty of resolving the problem of Britain's exit from the EU, a suspicious calm settled in the markets.

The increase in volatility promised by analysts has fallen, which can be explained by a drop in the desire of investors to show any activity on the eve of very important trade talks between Washington and Beijing, which will be held on January 30-31. Despite the high optimism of the expectations of a positive outcome of this meeting, there are real risks of its failure, since the result can only be achieved under strong US pressure on the PRC, and not, as they say, by voluntary mutually beneficial agreement.

Probably still, the agreement will be reached, since the Chinese will not risk a complete confrontation with the United States due to the country's excessive dependence on trade with them. But, most likely, the "heavenly" will harbor a grudge and at any suitable moment can strike back with a "blow" to Washington.

In addition, the focus of the market remains the topic of Brexit, which has already filled the edge but still has a significant impact on world markets and primarily on the British pound and the common European currency. In addition, the euro was still under new pressure, which is that the unexpected slowdown in the economies of the EU-leading countries of Germany and France almost buried the hopes of those investors who thought that in September of this year the ECB would begin the process of raising interest rates, which was the reason for the noticeable drop in the euro in the currency markets at the beginning of the year.

In our opinion, until the end of this month, a delicate balance has been established on the market. The US dollar cannot strengthen against major currencies due to the high probability that the Fed will pause in raising interest rates. At the same time, sterling remains hostage to the problem of Britain's exit from the EU. Euro currency does not receive support due to falling expectations that the ECB will begin the normalization of monetary policy this year. Commodity currencies remain hostage to a high probability of slowing down the growth of the world economy, which will reduce the demand for commodity and commodity assets. The Japanese yen is also actually frozen in place due to multidirectional reasons affecting its dynamics, the demand for defensive assets and the expectation of recession in Japan.

Summing up, we note that this state of affairs should be maintained until the end of the month, when one of the most important factors of uncertainty, trade relations between the States and China, will be resolved, which can serve as an incentive for increased investor activity.

Forecast of the day:

The currency pair EUR / USD is consolidating, remaining in the range. It can continue its gradual decline to 1.1300 if it overcomes the level of 1.1350.

The currency pair AUD / USD is trading below the level of 0.7150 in the wake of increasing concerns over the growth prospects of the world economy. If the pair holds below this mark, there is a probability of its decline to 0.7085.

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Simplified wave analysis of USD / CHF for January 22

Large-scale graphics:

Since February last year, the pair quotes form an upward wave model on the chart. By the end of September, the first 2 parts (A-B) were fully completed.

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Medium scale graphics:

In the wave ascending from the end of September, by the beginning of the current year, the internal structure (A-B-C) was clearly outlined.

Small-scale graphics:

Started on January 10, the rising wave has a strong reversal potential. Given that it completes the wave patterns of a rhinestone of several time scales, one can expect a domino effect. Kickbacks, in this case, will be a predominantly flat character.

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Forecast and recommendations:

The coming weeks will be favorable for supporters of the "game to increase." At its lower border, it is recommended to track the pair buy signals.

Resistance zones:

- 1.0050 / 1.0100

Support areas:

- 0.9950 / 0.9900

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 requires confirming signals of the trading systems you use!

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

Forecast for EUR / USD for January 22, 2019

EUR / USD

Yesterday's trading without the participation of American market participants went smoothly, investors ignored both positive Chinese data and weakened European ones. Industrial output in China in December showed an increase of 5.7% y / y against 5.4% y / y in November, retail sales increased from 8.1% y / y to 8.2% y / y. In Germany, the producer price index in December decreased by -0.4%. The euro was held below the balance line of the daily timeframe.

Today, the ZEW business sentiment index in Germany for the current month is expected to deteriorate from -17.5 to -18.8, a similar indicator for the euro area as a whole is predicted to be slightly better: -20.1 against -21.0 in November.

There are no more significant optimism reasons, so the euro will continue to decline, started on January 10th. On the four-hour chart, the signal line of the oscillator marlin turns down from the border with the growth zone.

The goal of 1.1302 is at least October 31st. Fixation below the level offers the prospect of a decline to 1.1195.

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Fractal analysis of major currency pairs for January 22

Dear colleagues.

For the currency pair Euro / Dollar, we expect further downward movement after passing by the price of the range of 1.1375 - 1.1358 and we consider the upward movement as a correction. For the currency pair Pound / Dollar, the price is in the correctional area of the upward structure on January 15 and we expect a continuation of movement upwards after the breakdown of 1.2945. For the currency pair Dollar / Franc, we should continue the development of the upward cycle from January 10 and after the breakdown of the level of 0.9984, we consider the downward movement as a correction. For the currency pair Dollar / Yen, it is likely to leave the price in the correction zone, for which a break of 109.46 is necessary. For the currency pair Euro / Yen, the upward movement is expected after the breakdown of 125.15 and the level of 123.05 is the key support. For the currency pair Pound / Yen, the price is in the correction and we expect further development of the upward structure from January 15 after the breakdown of 142.00.

Forecast for January 22:

Analytical review of H1-scale currency pairs:

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For the currency pair Euro / Dollar, the key levels on the H1 scale are 1.1496, 1.1428, 1.1404, 1.1376, 1.1358, 1.1321 and 1.1291. Here, we continue to follow the development of the downward cycle of January 10. We expect the downward movement to continue after the price passes the range of 1.1376 - 1.1358. In this case, the target is 1.1321. The potential value for the bottom is considered the level of 1.1291, upon reaching which we expect a rollback to the top.

The consolidated movement is expected in the range of 1.1404 - 1.1428 and the breakdown of the latter value will lead to a prolonged correction. Here, the target is 1.1469 and this level is the key support for the downward structure.

The main trend is the downward cycle of January 10.

Trading recommendations:

Buy 1.1406 Take profit: 1.1426

Buy 1.1430 Take profit: 1.1466

Sell: 1.1358 Take profit: 1.1324

Sell: 1.1320 Take profit: 1.1294

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For the currency pair Pound / Dollar, the key levels on the H1 scale are 1.3118, 1.3056, 1.3024, 1.2944, 1.2839, 1.2802, 1.2751 and 1.2661. Here, we are following the local ascending structure of January 15th. An upward movement is expected after the breakdown of 1.2944. In this case, the target is 1.3024 and in the range of 1.3024 - 1.3056 is the price consolidation. The potential value for the top is considered the level of 1.3118, after reaching which we expect a rollback downwards.

The range of 1.2839 - 1.2802 is the key support for the top. Its price passage will lead to an in-depth correction. Here, the target is 1.2751, before this value, we expect the appearance of a pronounced downward structure.

The main trend is the local structure for the top of January 15.

Trading recommendations:

Buy: 1.2945 Take profit: 1.3024

Buy: 1.3057 Take profit: 1.3118

Sell: 1.2839 Take profit: 1.2804

Sell: 1.2800 Take profit: 1.2754

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For the currency pair Dollar / Franc, the key levels on the H1 scale are 1.0065, 1.0034, 0.9984, 0.9930, 0.9906, 0.9874 and 0.9847. Here, we continue to follow the development of the ascending cycle of January 10. An upward movement is expected after the breakdown of 0.9984. In this case, the target is 1.0034. The potential value for the top is considered the level of 1.0065, 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 0.9930 - 0.9906 and the breakdown of the last value will lead to a prolonged correction. Here, the target is 0.9874 and this level is the key support for the ascending structure. Its breakdown will lead to a movement to the level of 0.9847.

The main trend is the ascending structure of January 10.

Trading recommendations:

Buy: 0.9986 Take profit: 1.0032

Buy: 1.0035 Take profit: 1.0065

Sell: 0.9930 Take profit: 0.9910

Sell: 0.9904 Take profit: 0.9880

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For the currency pair Dollar / Yen, the key levels on the scale of H1 are 110.33, 110.07, 109.81, 109.48, 109.26, 108.98 and 108.60. Here, we continue the uptrend after the breakdown of 109.81. In this case, the target is 110.07 and we consider the level of 110.33 as a potential value for the uptrend, upon reaching which we expect consolidation, as well as a downward rollback.

The short-term downward movement is possible in the range of 109.48 - 109.26 and the breakdown of the last value will lead to a prolonged correction. Here, the goal is 108.98 and this level is the key support. Its breakdown will have to form the initial conditions for the downward cycle. In this case, the goal is 108.60.

The main trend is the rising structure of January 10, the stage of correction.

Trading recommendations:

Buy: 109.81 Take profit: 110.05

Buy: 110.08 Take profit: 110.30

Sell: 109.46 Take profit: 109.26

Sell: 109.24 Take profit: 109.00

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For the currency pair Canadian dollar / Dollar, the key levels on the H1 scale are 1.33.95, 1.3320., 1.3271, 1.3201, 1.3150 and 1.3065. Here, the situation is in equilibrium and in the range of 1.3201 - 1.3150, we expect a short-term downward movement, as well as consolidation. The potential value for the bottom is considered the level of 1.3065, after reaching which we expect a rollback to the correction.

The short-term upward movement is possible in the range of 1.3271 - 1.3320 and the breakdown of the latter value will lead to an in-depth correction. Here, the target is 1.3395 and this level is the key support for the downward structure.

The main trend is the equilibrium state of the structure.

Trading recommendations:

Buy: 1.3271 Take profit: 1.3320

Buy: 1.3330 Take profit: 1.3395

Sell: 1.3201 Take profit: 1.3155

Sell: 1.3145 Take profit: 1.3070

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For the currency pair Australian dollar / dollar, the key levels on the H1 scale are 0.7270, 0.7238, 0.7204, 0.7152 and 0.7113 and 0.7059. Here, the short-term downward movement is expected in the range of 0.7152 - 0.7113 and the breakdown of the latter value will lead to a movement to the potential target of 0.7059, near this level is the price consolidation.

The level of 0.7204 is the key support for the downward trend on the H1 scale. Its breakdown will allow us to count on the formation of the initial conditions for the upward cycle. Here, the first target is 0.7238. The potential value for the top is considered the level of 0.7270.

The main trend is the equilibrium situation.

Trading recommendations:

Buy: 0.7204 Take profit: 0.7236

Buy: 0.7240 Take profit: 0.7270

Sell: 0.7148 Take profit: 0.7115

Sell: 0.7110 Take profit: 0.7064

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For the currency pair Euro / Yen, the key levels on the H1 scale are 127.22, 126.70, 125.79, 125.15, 123.74 and 123.05. Here, we continue to follow the rising structure of January 3. At the moment, the price is in a deep correction. An upward movement is expected after the breakdown of 125.15. In this case, the target is 125.79 and price consolidation is near this level. The breakdown of 125.80 must be accompanied by a pronounced upward movement. Here, the goal is 126.70. The potential value for the top is considered the level of 127.22, after reaching which we expect a consolidated movement, as well as a rollback to the top.

The short-term downward movement is possible in the range of 123.74 - 123.05 and the breakdown of the latter value will have to form a downward structure. In this case, the potential target is 122.03, up to this level, we expect clearance of the expressed initial conditions for the downward cycle.

The main trend is the ascending structure of January 3, the stage of deep correction.

Trading recommendations:

Buy: 125.15 Take profit: 125.76

Buy: 125.82 Take profit: 126.70

Sell: 123.70 Take profit: 123.10

Sell: 123.05 Take profit: 122.10

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For the currency pair Pound / Yen, the key levels on the H1 scale are 145.74, 144.44, 143.91, 142.82, 141.94, 141.04, 140.21 and 139.31. Here, we are following the development of the ascending structure of January 15. The short-term upward movement is possible in the range of 141.94 - 142.82 and we expect further upward movement after the breakdown of 142.82. In this case, the target is 143.91 and in the range of 143.91 - 144.44 is the price consolidation. The potential value for the top is considered the level of 145.74, upon reaching which we expect a rollback downwards.

The short-term downward movement is possible in the range of 141.04 - 140.21 and the breakdown of the latter value will lead to an in-depth correction. Here, the target is 139.31 and this level is the key support for the top.

The main trend is the local ascending structure of January 15.

Trading recommendations:

Buy: 142.00 Take profit: 142.80

Buy: 142.84 Take profit: 143.90

Sell: 141.00 Take profit: 140.30

Sell: 140.20 Take profit: 139.40

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EUR/USD: Third wave to deliver new low

The market has been declining since an upward impulse in wave (A) finished. Previously, we had a large zigzag in wave ((W)). Considering there's a downward five-wave price movement form the last high in wave A, wave (B) is likely going to take the form of a zigzag. If correct, we're going to have the rest of wave C of (B) soon.

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Thus, after a short break, the price is likely going to continue declining. The primary target for the current correction is the 0.786 retracement level of wave (A) at 1.0813. The subsequent pullback from this level could lead to another bullish wave. Therefore, because of the five-wave price movement in wave (A), there'll be a moment for an upward impulse wave when wave (B) ends.

As you can see on the 10H chart, there're a bearish impulse in wave A and an upward zigzag in wave B. Also, we've got here a possible leading diagonal pattern, which is likely the first wave of wave C. If so, the last upward price movement is wave ((ii)) and there's an opportunity to have the third wave of wave C in the coming days.

Let's have a look at the one-hour chart. Wave ((ii)) has finished as a zigzag with an expanding ending diagonal in wave (c). A pullback from the upper side of this pattern led to the current decline, which is likely wave (i). This bearish impulse is about to end because we need to have just a few more waves to consider wave (i) as completed.

In a nutshell, the successful ending of an impulse in wave (i) will confirm the main bearish story. However, we should be careful until wave (ii) arrives. Anyway, there's a green light for a bearish impulse in wave ((iii)) of C, so the low of wave ((i)) is going to be broken in the short term.

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Fundamental Analysis of GBP/USD for January 22, 2019

GBP/USD recently rejected off the 1.30 price area amid strong bearish impulsive momentum. The pair is expected to sustain bearish pressure with a target towards 1.2700-50 support area. Only 2 months are left before the UK exits from the European Union. However, no proper deal which also sets out trade relations with the EU has been finalized yet. Meanwhile, the british lawmakers are discussing the alternative Brexit deal suggested by Theresa May.

Last week, the British Parliament rejected the Brexit divorce deal proposed by Prime Minister Theresa May. Now she has been searching ways to get the deal through the parliament, though without any success. The EU economy exceeds the UK economy six times. So the EU authorities want to have an orderly Brexit and do not want to struggle again with London, deepening a political crisis over Brexit. The political conditions in the UK are currently working as one of the factors, affecting GBP growth. Economic reports are another reason. Today UK Average Cash Earnings report is going to be published which is expected to be unchanged at 3.3%, Public Sector Net Borrowings are expected to have a positive change with a decrease to 1.1B from the previous figure of 6.3B, Unemployment Rate is expected to be unchanged at 4.1%, and Claimant Count Change is expected to have a positive result with a decrease to 20.1k from the previous figure of 21.9k.

On the other hand, this week is expected to be quite slow for USD as the economic calendar contains no economic reports fronm the US to encourage USD gain. Besides, upcoming economic reports are also expected to have bearish readings. Today, Existing Homes Sales report is going to be published which is expected to decrease to 5.27M from the previous figure of 5.32M. Next week, CB Consumer Confidence index and Federal Funds Rate report are due in the US, but they are of little importance for USD. So until next week, the US currency is expected to trade steadily against GBP. Despite the government shutdown for over 29 days, USD gains indicate its strength amid GBP weakness.

Meanhwile, GBP is propped up by optimistic expectations for the upcoming economic reports from the US. Nevertheless, the market is biased towards USD amid political tensions in the UK.

Now let us look at the technical view. The price is currently holding below 1.2900 area after certain indecision yesterday. Amid impulsive bearish momentum after rejecting off the 1.30 area recently, the pair is expected to retain bearish pressure towards 1.2700-50 support area in the coming days. As the price remains below 1.30 area with a daily close, the pair is set to trade with the bearish bias.

SUPPORT: 1.2500, 1.2700-50, 1.2850

RESISTANCE: 1.2930, 1.30

BIAS: BEARISH

MOMENTUM: VOLATILE

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Wave analysis of EUR / USD for January 22. Euro gradually slipping down

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Wave counting analysis:

On Monday, January 21, bidding ended for the pair EUR / USD by 3 bp, however, the decline in quotations has already resumed within the expected wave 4, c, which takes a very long look. This may lead to the need to make adjustments to current wave marking. A tool reduction below the minimum of January 3 will mean a willingness to build a descending trend segment, which can be quite lengthy. Is the Euro-currency ready for such kind of fall in terms of the news background?

Sales targets:

1.1345 - 38.2% Fibonacci

1.1315 - 23.6% Fibonacci

Shopping goals:

1.1599 - 161.8% Fibonacci

1.1677 - 200.0% Fibonacci

General conclusions and trading recommendations:

The pair remains in the construction stage of the proposed wave 4, in s. However, a sluggish tool reduction can lead to an adjustment to the current wave marking. Thus, now I recommend not to open new purchases, since the probability of complication of the wave pattern is great. The news background is now missing, which also does not add clarity to the current picture.

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Indicator analysis. Daily review for January 22, 2019 for the pair EUR / USD

On the way down, the price may encounter the first goal - the fourth point of the young support line 1.1342 (red thin line).

Trend analysis (Fig. 1).

On Tuesday, the price will move down. The first lower target 1.1442 is the support line (red thin line), then roll back up is possible.

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Fig. 1 (daily schedule).

Comprehensive analysis:

- indicator analysis - down;

- Fibonacci levels - down;

- volumes - down;

- candlestick analysis - up;

- trend analysis - down;

- Bollinger lines - down;

- weekly schedule - down.

General conclusion:

On Tuesday, the price will move down. The first lower target 1.1442 is the support line (red thin line), then roll back up is possible.

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