BITCOIN Analysis for February 1, 2019

Bitcoin has been quite indecisive and volatile below $3,500. The price dipped below $3,400 recently but managed to push higher in the process. The price is currently residing inside the Kumo Cloud resistance and below 200 EMA dynamic resistance as well. The volatility is still quite strong. After the recent swings, the price is proceeding higher with strong bullish pressures after every corrective bearish momentum. BTC is expected to retest $3,500 again in the coming days. If the price manages to break above $3,500 area with a daily close, BTC is likely to extend bullish pressure with a target towards $4,000.

SUPPORT: 3,000, 3,250

RESISTANCE: 3,500, 3,600, 4,000

BIAS: BULLISH

MOMENTUM: VOLATILE

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GBP: hope for a "soft" Brexit remains but declines every day

While some experts point to the growing risk of UK withdrawal from the EU without a deal and believe that the pound's collapse is just a matter of time, others believe that London will try to postpone Brexit instead, from which the British currency will benefit.

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In particular, the specialists of Deutsche Bank, who previously recommended to take the "longs" in the British currency, now hold a neutral position.

"We believe that Malthouse compromise has almost zero chance of success in the European Union", they said.

According to experts at Nordea Bank, the vote, which took place in the House of Commons last Tuesday, pushed the United Kingdom closer to a controlled exit without a deal.

"We do not share the optimism of investors about Brexit and in their place would not be so careless about the threat of lack of agreement," said representatives of the financial institute.

They advised selling the pound against the euro with a target of 89.50.

"The psychological game between Britain and the EU seems to have entered a crucial phase this Tuesday. At the moment this does not seem to be taken into account by the markets in prices. However, the main question is whether the deal is possible in principle, given the fact that there are still important differences between Brussels and London. Most likely, the pound will return the newly scored points against the euro and the dollar and go to levels of € 0.89 and $ 1.29, that is, where the last "British" rally began, "said analysts at Credit Agricole.

In turn, UniCredit currency strategists maintain a positive attitude towards sterling and expect a revival of interest in currency purchases closer to February 13 if the British parliament will hold a second vote on the divorce agreement.

"We proceed from the fact that chaotic Brexit or exit without a deal can still be avoided," they said.

"In our opinion, an extension of the term of Article 50 of the Lisbon Treaty may be required, even if eventually the parties reach an agreement. A pound may strengthen against the Swiss franc amid rising expectations of a second referendum or the implementation of a "soft" scenario, "BNP Paribas believes.

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Fundamental Analysis of NZDJPY for February 1, 2019

NZD/JPY has been quite impulsive and volatile under the recent bullish momentum which led the price towards 75.50 area recently. JPY has been quite solid in light of the latest economic reports, whereas NZD might lose ground after the positive Trade Balance report.

Recently New Zealand's Trade Balance report showed a proficit at 264M from the previous deficit of -955M, analysts had expected more modest proficit at 255M. This significant change in the Trade Balance helped NZD to attract market sentiment, but sustainability against JPY may fade in the coming days. Recently Japan's Finance Minister defended the government's view that incomes are rising despite the challenges faced by the economy earlier. Today, Japan's Unemployment Report showed decrease to 2.4% which was expected to be unchanged at 2.5% and Final Manufacturing PMI ticked up to 50.3 instead of the flat forecast at 50.0. Despite the massive monetary stimulus over 6 years, Japan's wages have been creeping with the muted growth. The recent monitoring revealed positive changes.

Meanwhile, JPY has found support from the economic reports published throughout the week, it but could not gain momentum against NZD. Ahead of employment reports from New Zealand to be published next week, JPY is expected to regain some grounds in the coming days which might strengthen further if NZD fails to provide good economic data in the future.

Now let us look at the technical view. The price is being held by the GANN Grid Lines as resistance while being supported by the dynamic level of 20 EMA throughout the bullish pressure in the pair. The price recently bounced off the 75.50 area with strong bearish momentum which is expected to lead the price towards 74.50 and later towards 73.00 area in the future. As the price remains below 75.50 area with a daily close, the bearish bias is expected to continue.

SUPPORT: 73.00, 74.50

RESISTANCE: 75.50, 77.00

BIAS: BULLISH

MOMENTUM: VOLATILE

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Dollar slapped by the Fed

The pulling of the rope between a weak euro and a dollar that is actively losing last year's trumps results in a consolidation development. If in 2018 the US currency actively used such drivers as the acceleration of the US economy under the influence of fiscal stimulus, aggressive monetary restriction of the Fed and high demand for safe-haven assets in terms of trade wars, then events in 2019 such as the GDP slowdown, pause in the normalization process and Washington and Beijing negotiations should have made her a whipping boy. If it were not for one "but." Competitors are in no hurry to take advantage of yesterday's leader's vulnerabilities.

A strong economy is a strong currency. This principle of fundamental analysis has not been canceled. Also, looking at the technical recession in Italy, the eurozone's GDP growth by 0.2% q/q in July-September and in October-December, disappointing statistics on German retail sales and the stubborn unwillingness of core inflation to move away from 1%, we can assume that currency block needs help. For example, it can be in the form of additional monetary incentives (LTRO), which some members of the Governing Council spoke about at the January meeting.

Dynamics of European inflation

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In fact, Mario Draghi does not see an emergency in which one could launch a long-term refinancing program for commercial banks or resume QE. Jens Weidmann draws attention to the lack of ammunition to deal with a potential crisis. They say you need to close your eyes to sluggish inflation and begin to normalize monetary policy. In addition, the progress in the negotiations between the US and China is able to lend a helping hand to European exports and accelerate GDP.

In contrast to the euro, burdened with the problems of the economy of the currency bloc, the dollar is losing fans due to a drastic change in the Fed's global outlook. Just 6 weeks ago, the Central Bank was ready to continue raising the federal funds rate at almost the same pace as in 2018, but in January, Jerome Powell claims that the deterioration of macroeconomic statistics for the States will lead to monetary expansion. Investors seriously believed that the normalization cycle had been completed and were eagerly awaiting new incoming data.

In this regard, the release of the report on the US labor market in January more confused investors than clarified the situation despite the impressive increase in employment outside the agricultural sector (+304 thousand). Additionally, other reports such as unemployment rose to 4%, and the average wage showed much less growth than expected (+ 0.1% vs. + 0.3% m / m). The EUR / USD pair has reacted quite vividly to the numbers, but to say that it has decided on the direction of further movement is extremely rash. Consolidation continues and only a breakthrough of resistances at 1.151 and 1.154 will open the way for the bulls to the north.

Technically, correction levels of 78.6% and 88.6% of the CD wave of the Shark pattern are located at these elevations. As a rule, tts transformation into 5-0 gives a hint about the future path of EUR / USD. The fact that the Bears failed to keep the quotes below 50% and 61.8% indicates their weakness.

EUR / USD daily chart

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Eurozone inflation slowed to a minimum in 11 months to January

According to the statistical report of the EU Eurostat, the growth rate of consumer prices in the eurozone slowed down in January to a minimum in the previous 11 months. Inflation rose by only 1.4% year-over-year in January, while in December last year, the corresponding figure rose by 1.6%. The index of low index growth coincided with market expectations. As you know, the target inflation rate of the European Central Bank (ECB) is the "lower, but close to 2%" area.

The core inflation in January (excluding energy , alcohol and tobacco prices) accelerated to 1.1% after rising 1% in December 2018. Experts predicted that this indicator would remain unchanged.

The largest increase in January was demonstrated by energy prices (2.6%); Consequently, food, alcohol and tobacco increased in price by 1.8%. The cost of services increased by 1.6%, manufactured goods went up by 0.3%.

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Euro: light at the end of the tunnel

The recent dynamics of the euro against the dollar resembles a rollercoaster ride. Hence, initially the ECB signals about the possibility of expanding stimulus measures sent the EUR/USD pair below $ 1.13, but then, the Fed's hints about a pause in the monetary tightening cycle allowed the single European currency to rise to $ 1.15. However, the ensuing weak data on eurozone GDP cooled the fervor of the bulls.

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On the eve after the head of the Bundesbank said the German economy has entered a period of short-term deceleration, the euro fell sharply. Today, the single European currency managed to win back some of the losses incurred.

If we assume that in the foreseeable future the Fed will not raise the interest rate and if the economic situation in the country deteriorates, it may even be reduced, then the continuation of the EUR / USD movement to the north seems entirely possible.

In addition, the factors that had a negative impact on the growth of the eurozone economy in the third and fourth quarters are expected to be temporary. The settlement of trade disputes between the US and China will have a positive impact on exports and business activity of the currency bloc.

Thus, the gradual improvement of the state of the eurozone economy and the de-escalation of the trade conflict between Washington and Beijing will act as positive factors for the euro. Although, having understood the Celestial Empire, the United States can switch to Europe. Also, do not forget about the Fed's intention to make decisions depending on the incoming data.

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It is assumed that a strong report on the US labor market in January will allow the EUR/USD bears to develop an attack in the direction of 1.12, while weak statistics will give the bulls the hope of resuming the rally to 1.16.

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GBP / USD pair: plan for the American session on February 1. The pound fell on weak data on manufacturing activity

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

The UK manufacturing sector PMI was worse than economists' forecasts, which led to the return of the pair to the large support area of 1.3053, from which buyers are now trying to build a new upward trend. As long as trade is conducted above this level, the demand for the pound will remain and a weak report on the US labor market may quickly return the pair to the average border of 1.3104 and also lead to an update of the maximum of 1.3159, where I recommend taking profits. In the case of a decrease in the pound in the second half of the day, long positions can be viewed at a rebound from the support of 1.2971.

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

A repeated support test of 1.3053, together with good data on the US labor market, will lead to a continuation of the GBP/USD decline with a minimum of 1.2971, where I recommend taking profits. In the case of a pound rise in the afternoon, sales can return only on a false breakdown from the average border of the side channel 1.3104 or on the rebound from 1.3159.

More in the video forecast for February 1

Indicator signals:

Moving averages

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

Bollinger bands

Bollinger Bands indicator volatility has decreased, which does not give signals on the market entry.

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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Bitcoin analysis for February 01, 2019

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Bitcoin has been trading sideways at around $3,411. Our bearish view from yesterday is still active. Since the key support cluster at $3,420 is broken and was successfully retested, we expect downward continuation. I also found a successful breakout of the most recent mini upward Pitchfork channel, which is another sign of underlying weakness. Short-term resistance is set at the price of $3,452 and short-term support at $3,324.

R1: $3.457

R2: $3.504

R3: $3.535

Pivot: $3.425

S1: $3.378

S2: $3.347

S3: $3.300

Trading recommendation: We are still short BTC/USD from $3,392 and with the target at $3,107. Protective stop is placed at the price of $3,550

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Simplified Wave Analysis GOLD for the week of February 1

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

Euro buyers returned to the resistance level of 1.1471, to which I paid attention in my morning review, but in order to continue the upward correction, you need to gain a foothold on it. This can be done only after weak data is released on the US labor market, which are expected in the afternoon. A break of 1.1471 will lead to a larger upward trend in the area of a weekly high of 1.1506, where I recommend taking profits. In the event of a further euro decline in the second half of the day, you can buy on a false breakdown from 1.1434 or already on a rebound from a minimum of 1.1393.

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

Vendors have already shown themselves in the resistance area of 1.1471 and good statistics on the US labor market can quickly turn the euro down, which will lead to the updating of today's low of 1.1434. Then, the EUR / USD will likely fall to the support area of 1.1393, where I recommend to fix profits. In case of further euro growth in the second half of the day, short positions will be relevant only after the update of the maximum of 1.1506, where buyers will also record their long positions at the end of the week.

More in the video forecast for February 1

Indicator signals:

Moving averages

Trade returned to the area of 30- and 50-medium moving, which limits the upward potential of the euro.

Bollinger bands

The pair has rested against the upper limit of the Bollinger Bands indicator, and only its breakdown will lead to a new wave of growth. The lower limit around 1.1430 will help euro buyers in the event of a fall in the afternoon.

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Description of indicators

MA (moving average) 50 days - yellow

MA (moving average) 30 days - green

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

Bollinger Bands 20

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Analysis of Gold for February 01, 2019

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Buying climax in the background on Gold. The buying climax represents a big sign of weakness, which made Gold trade sideways. So far, I found that buyers don't have power for another strong push higher, so we exited our both long positions with 3,700-pips profit. Now we are waiting for a potential break of the key short-term support at $1,316.00 to confirm the downside. Major resistance is set at the price of $1,325.00.The potential head and shoulders pattern is in creation, which is another sign of the potential weakness.

R1: $1.330.00

R2: $1.335.50

R3: $1.339.45

Pivot: $1.326.80

S1: $1.321.25

S2: $1.317.27

S3: $1.312.35

Trading recommendation: We are neutral on Gold but if we see the break of the support ($1.316.00), we will sell Gold with SL at $1.325.00 and targets at $1.309.50-$1.298.00.

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Simplified Wave Analysis GOLD for the week of February 1

Large-scale graph:

The main direction of the gold trend since August last year looks at the "north" of the chart. The wave is the final part of the global ascending model.

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Medium-scale graph:

The bullish section of the schedule of November 13 forms the final part (C) in a larger structure. The lower boundary of the preliminary target zone is in the area of the calculated resistance.

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Small-scale graph:

The bullish wave launched on December 21. It completes the ascending structure in the wave of the older timeframe. In the coming days, a short-term price pullback is not excluded.

Forecast and recommendations:

The trend in the growth rate of gold continues which can benefit traders. The support zone is found on the level of former resistance that is suitable for completing the rollback.

Resistance zones:

- 1375.0 / 1380.0

Support areas:

- 1300.0 / 1295.0

Explanations of the figures:

The simplified wave analysis uses waves consisting of 3 parts (A – B – C). Three consecutive graphs are used for analysis. Each of these 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 and the dotted exhibits the expected movement.

Note: 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!

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GBP/USD analysis for February 01, 2019

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With the down break of the larger upward Pitchfork channel, the GBP/USD pair changed behavior from bullish to bearish. The key support at 1.3055 is broken and this is a good confirmation of weakness. I also found a breakout of the upward mini Pitchfork channel, which is another confirmation of weakness. As long as the resistance is holding at 1.3160, a downward movement is expected. The short-term trend is bearish.

R1: 1.3148

R2: 1.3186

R3: 1.3210

Pivot: 1.3123

S1: 1.3085

S2: 1.3060

S3: 1.3025

Trading recommendation: We are bearish on the GBP/USD from 1.3050 with the downward target at the price of 1.2905. The protective stop is placed at 1.3165.

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EUR / USD: the recipe for "survival" of the euro

At the end of last year, the head of the European regulator warned that the EU economy would gradually slow down, given the dynamics of leading indicators and he was not mistaken. The key countries of the European Union published depressing data in early January.

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First of all, the data on inflation in Germany was a disappointment. On a monthly basis, the consumer price index dropped to -0.8% for the first time since January 2018, falling to the negative area and 1.4% in annual terms. The negative trend for the third month in a row continues. Retail sales in Germany also set an anti-record, the indicator collapsed immediately to -4.3% on a monthly basis with a decline forecast to -0.5%.

The release data on the growth of European GDP was at the level of forecasts, confirming the slowdown in the European economy to 1.2% in annual terms. Another disappointment with the Italian economy showing a negative result in December. The index of Italian GDP is below zero for the second month in a row - in other words, the third largest eurozone economy has entered a stage of technical recession. Moreover, the Italian Prime Minister predicted a decline in GDP during the first two quarters of the current year.

In the quintessence of the current situation is today's release of data on the growth of European inflation. The consumer price index has expectedly slowed to 1.4%, falling for the third consecutive month. Last October, this indicator was at the level of 2.2%, but then this index began to follow the oil market, which also began to rapidly lose in price since mid-autumn. By the way, the core inflation today has pleasantly surprised the EUR/USD bulls and most experts expected to see this indicator at one percent level, but in the end, it turned out to be slightly higher - at around 1.1%. However, this is not a reason for any excessive optimism as the core index of inflation has been in the range of 0.9% -1.1% since May last year. Hence, today's figures can only please us by not exceeding its lower bounds.

All of these suggest that the European Central Bank is very likely to take a waiting position this year, thereby depriving the single currency of an important trump card, even representatives of the "hawk" camp of the ECB recognize this fact. In this context, yesterday's speech by the head of the Bundesbank, Jens Weidmann, who has consistently defended the idea of a return to a tight monetary policy, was instructive. However, he has somewhat softened his position today. He said that the growth of the German economy this year will be even lower than the revised forecasts.

Let me remind you that this week, the German Ministry of Economics reported that they are reducing their forecast for the growth of the national economy this year to 1%. But the real result in Weidmann's opinion, will be even below weak forecasts. At the same time, he acknowledged that the fact of a slowdown in Europe's largest economy will serve as a "deterrent" for the ECB in the context of a decision on interest rates. Earlier, a similar position was expressed by two more members of the governing council of the European regulator.

Given the above disposition, a logical question arises: why is the EUR/USD pair so steadfastly keeping in the area of the 14th figure without leaving the price range of 1.1380-1.1490? In my opinion, such a dynamic is initially because of the general weakness of the dollar and secondly, in hope for a truce between the US and China. These factors correspond to each other but they affect the EUR/USD pair differently. In particular, the dovish attitude of the Fed eliminates the negative effect of European statistics, supporting the pair in a given range.

However, the success of the US-China negotiations is pushing the pair up. True, lately there is less and less good news in this aspect: the "Huawei case" and the new requirements of Donald Trump reduced the likelihood of a broad deal in the near future. For this reason, the EUR/USD pair showed a southern momentum yesterday, rolling away from local maxima but today the situation has somewhat changed. Chinese President Xi Jinping said that he was ready to continue negotiations with President Trump, despite all the surrounding circumstances (the next round of negotiations will take place in mid-February). The euro's reaction is coming not long and once again demonstrates a "hawkish" attitude, despite the decline in the German economy and pan-European inflation figures.

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Thus, traders of the euro-dollar pair are now focusing more on US events and the external fundamental picture, primarily in the context of the prospects for the negotiation process between Beijing and Washington. Therefore, today's northern impulse of EUR/USD pair may continue if American nonfarm disappoint the market. In this case, the dollar index will again go to the bottom of local minima, and the euro major pair will be able to test the 15th figure again.

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Recent bearish rejection being applied over the EUR/USD pair around the upper limit of the daily channels for February 1,

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Since June 2018, the EUR/USD pair has been moving sideways with slight bearish tendency within the depicted bearish 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 bullish channel (In BLUE) was initiated.

Bullish fixation above 1.1420 was needed to enhance a further bullish movement towards 1.1520.

However, the market has been demonstrating obvious bearish rejection around 1.1420 few times until Monday when the daily candlestick achieved a bullish closure above 1.1420.

A further bullish advance should be expected towards the price level of 1.1550 where the upper limit of both depicted channels (RED & BLUE) is located.

Around 1.1550-1.1570, there's a confluence of supply levels (upper limit of channels & previous historical bottoms) where bearish rejection as well as a valid SELL entry would be expected.

On the other hand, any bearish closure below 1.1420 terminates the current bullish movement (initiated on January 25) allowing another bearish visit towards 1.1350 and 1.1300.

Trade Recommendations:

Conservative traders should wait for the current bullish pullback to pursue towards the price level of 1.1550-1.1570 for a valid SELL entry.

T/P levels to be located around 1.1420 and 1.1300. S/L to be located above 1.1600.

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WTI crude oil prices rose in January

According to experts, the results of the past month showed an increase in WTI oil quotes by 18.67% to $ 53.90 per barrel. This is the most impressive growth for the first month of the year in the entire history of trading, analysts emphasized.

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On Thursday, January 31, quotes for March futures for WTI oil on the NYMEX exchange reached $ 55 per barrel. Since the beginning of this year, its price has increased by almost $ 9 per "barrel".

According to the calculations of the consulting company of OPEC, JBC Energy, recorded a decrease in the cartel's production level to 30.85 million barrels per day (b/d) in January 2019. The reason for the fall of experts believes the reduction of supply from Saudi Arabia. In general, the execution of the OPEC + contract of December 7 last year was implemented by 109%.

Russia also met the specified schedule of reductions. According to the Minister of Energy of the Russian Federation, Alexander Novak, the level of oil production in the country in January decreased by 50 thousand compared with the level of October 2018. At the same time, the January figure was about 100 thousand b/d lower than in December last year.

According to a US Energy Information Administration (EIA) report, oil production in the country rose to an impressive 11.9 million b/d in November 2018. At the same time, production volumes in the Gulf of Mexico were revised from 1.73 million to 1.92 million b/d. This indicator is a record for this region. The maximum oil production figures for this period recorded 4.84 million b/d extracted in Texas.

Market participants are positive about the results of the negotiations between the United States and China. They count on the mutual agreement of the parties. According to analysts, this reduces the risk of exacerbating protectionism and reducing global demand. The Fed meeting held on Thursday is also a driver for the growth of quotes. The American regulator believes that further increase in rates will depend on the market situation. A number of experts do not expect an increase in rates in the first half of 2019 and some expect to maintain the current situation in the next three quarters.

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Intraday technical levels and trading recommendations for GBP/USD for February 1, 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 until January 17 when a bearish Engulfing candlestick was demonstrated around 1.2999 (around the depicted downtrend line in RED).

This paused the bullish scenario for a while, allowing sometime for bearish correction towards 1.2830 where another bullish swing was initiated.

On Friday, the GBP/USD pair was almost approaching the supply level of 1.3240 when the current bearish pullback was initiated around 1.3215.

A bearish engulfing daily candlestick was demonstrated by the end of Tuesday's consolidations. Thus, the GBP/USD pair lost its bullish breakout above 1.3155. Thus, an intraday supply level is currently located around 1.3155.

The current decline below 1.3150 will probably bring the GBP/USD pair into a deeper bearish correction that extends down to 1.3000 where bullish recovery should be anticipated.

On the other hand, for the bullish scenario to regain its validity, bullish persistence above the price level of 1.3150 (Recent Supply Level) should be re-established on a daily basis. This would enhance another bullish visit towards 1.3240.

Trade Recommendations:

Conservative traders should wait for a bearish pullback towards 1.3000 (backside of the broken downtrend in RED) for a valid BUY entry.

T/P levels to be located around 1.3055, 1.3155 and 1.3200. Any bearish H4 closure below 1.2950 invalidates this scenario.

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Trading Plan 02/01/2019

The big picture: We are waiting for data on employment in the US.

The main plots in recent weeks have become clear.

The ECB is firm in its super-soft policy are there is no increase in the rate at least until Autumn.

On the other hand, the Fed's soft policy have no promise to raise the rate.

The question about the shutdown in the USA has been postponed until February 15. It is most likely that there will be no more stopping of financing.

The US-China trade negotiations are being delayed.

Concerning the UK-EU agreement on life after Brexit, Theresa May is trying to gather Labor support and promising them concessions on other important issues. However, the pound shows that the markets have already laid in prices for Britain's exit from the EU without an agreement.

The question of employment (nonpharma) in the USA for January remains with a forecast of adding 160 to 180 thousand.

A strong deviation from the forecast can swing the market.

We are ready to buy euros from 1.1515 .

We are ready to sell the euro from 1.1285.

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Technical analysis of NZD/USD for February 01, 2019

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Overview:

The NZD/USD pair breached resistance which had 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 RSI is considered to be 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 that the pair will probably go up in the coming hours. Accordingly, the market is likely to show signs of a bullish trend. In other words, buy orders are recommended to be placed 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. However, if there is a breakout at the support level of 0.6705, this scenario may become invalidated.

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Technical analysis of GBP/USD for February 01, 2019

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Overview:

The GBP/USD pair will continue rising from the level of 1.3048 today. So, the support is found at the level of 1.3048, which represents the pivot point in the H1 time frame. Since the trend is above the pivoti level, the market is still in an uptrend. Therefore, the GBP/USD pair is continuing with a bullish trend from the new support of 1.3048. The current price is set at the level of 1.3080. Equally important, the price is in a bullish channel. According to the previous events, we expect the GBP/USD pair to move between 1.3048 and 1.3139. Therefore, strong support will be formed at the level of 1.3048 providing a clear signal to buy with the targets seen at 1.3139. If the trend breaks the support at 1.3139 (first resistance), the pair will move upwards continuing the development of the bullish trend to the level 1.3222 in order to test the daily resistance 2. In the same time frame, resistance is seen at the levels of 1.3048 and 1.3222. The stop loss should always be taken into account for that it will be reasonable to set your stop loss at the level of 1.2959.

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

EUR / USD: Non-Farm Employment Change report will either help the US dollar or leave everything unchanged.

Despite the versatile statistics on the American economy, traders continued to open long positions in the US dollar against the euro on Thursday, as the problems at the beginning of the year in the eurozone are much more serious.

Salaries in the United States continued to show growth, albeit at a slower pace compared with the previous quarter. According to a report by the US Department of Labor, the labor costs index in the 4th quarter of 2018 increased by 0.7% compared to the 3rd quarter. Economists had expected a larger increase in the 4th quarter, after a 0.8% increase in the 3rd. Compared to the same period of the previous year, the labor costs index showed an increase of 2.9%.

The labor market data slightly disappointed traders, however, the entire emphasis today is shifted to a report on the number of people employed in the non-agricultural sector.

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According to the US Department of Labor weekly report, the number of initial claims for unemployment benefits rose by 53,000 to 253,000 in the week from January 20 to January 26. Economists had expected the number of applications to rise to 215,000.

As noted above, the current movement of the US dollar will directly depend on the report on the number of people employed in the US non-farm sector. If the index turns out to be better than economists' forecasts and the growth exceeds 165,000, we can expect a strengthening of the US dollar and a decline in the EUR / USD pair to the support area of 1.1390 and 1.1340. If the data turns out to be worse than the forecasts or coincide with them, it is likely that the pair will remain traded in the side channel.

Data on sales in the primary housing market of the United States supported the US dollar, as they were much better than economists' forecasts. According to a report by the US Department of Commerce, sales in the primary housing market rose immediately by 16.9% compared with the previous month, to 657,000 homes per year. Economists had expected sales of 571,000 homes per year. Compared to the same period of the previous year, sales decreased by 7.7%, which is directly related to the high rates on mortgage loans.

The upside potential of the US dollar in the afternoon limited the report from MNI Indicators, in which it was stated that Chicago PMI Purchasing Managers Index in January 2019 was 56.7 points versus 63.8 points in December. Economists had expected the index to be 61.4 points.

The Canadian economy contracted slightly in November due to a drop in wholesale trade and manufacturing in manufacturing. The USD / CAD pair traded in the sideways channel yesterday after the release of Canadian GDP data.

According to the report, the economy declined in November 2018 by 0.1% compared with the previous month and amounted to 1.944 trillion Canadian dollars. Compared to the same period last year, Canadian GDP grew by 1.7%.

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

Fed changes the rules

The US dollar continues to be under pressure after, on Wednesday, the US Federal Reserve, through the mouth of J. Powell, announced that the rate for trust funds is at the optimum level. Growing demand for gold and other defensive assets indicates growing market doubts that the Fed will find grounds for raising rates this year amid growing recession threats in the coming year.

The outcome of the Fed meeting forces investors to rethink the logic that underlies the Fed's position. If earlier there was confidence in the markets that the Fed was guided by the Taylor formula for calculating the nominal interest rate, then now we have to admit that the Fed is guided by other logic, in which the markets have yet to figure it out.

The Taylor rule contains three key principles. First, the Fed should raise its target rate faster than inflation rises. Secondly, it is necessary to take into account the weakness of the economy, that is, to react to a decrease in output. And thirdly, the equilibrium interest rate should be constant and be at the level of 2%. That's just the third point and identified the problems that led to a change in the position of the Fed.

If we proceed from the principles laid down in the Taylor formula, then the target rate at the end of 2018 should be 4.75%, hence the market confidence for quite a long time that the rate will rise and the yield of dollar-denominated assets increase. Depending on the different behavior of inflation, the calculated level of the rate should go higher or lower, but in any case should be higher than the current level.

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However, a problem emerged that Taylor could not have foreseen in his 1993. The demand for US Treasury securities, which underlie the calculation of the equilibrium interest rate, is decreasing, and the Fed can do nothing about it.

The reduction in the balance sheet, which was started by the Fed, on paper looked like a step that was calculated and had no alternative. The Fed pays a portion of its liabilities on a monthly basis without the usual reinvestment, while the rate on required reserves of commercial banks grows more slowly than the target rate. Kombank withdrawal of reserves from the Fed's accounts and move them to the domestic debt market, that is, buy part of the US debt instead of the Fed. A scenario close to the Japanese was conceived, where, as you know, the main holders of domestic debt are just commercial banks that have to constantly finance the government.

However, something went wrong. After the December meeting, the rate on required reserves of commercial banks was equal to the target rate, that is, banks no longer have any benefit to keep funds in the Fed's accounts. However, instead of buying government debt, commercial banks are beginning to look for profitability outside the United States.

This is the main reason for the change of position of the Fed. The balance goal will be revised because there is no certainty that there will be a sufficient number of investors able to buy US Treasury obligations, which means that the Fed will have to keep some part of the national debt on its balance sheet. In March, the Congress will begin to consider the issue of raising the national debt ceiling, and there must be confidence that there will be a buyer.

Now, players have only one opportunity to see an increase in yields on US securities, economic growth. Today, data on employment in January will be published, in case they turn out to be worse than expected, the dollar drops even lower, while gold remains the main favorite.

Eurozone

Almost all macroeconomic information coming from the eurozone indicates a growing risk of a slowdown. The European Commission confirmed the findings that economic activity is slowing down, consumer inflation in Germany in January is worse than forecast, retail sales fell below a two-year low, GDP growth rates in Q4. at 6-year lows.

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The euro is declining after the speech by the head of the Bundesbank, Weidmann, who directly stated that the policy of normalizing the ECB is being postponed. EUR / USD is likely to end the week in the 1.1430 / 55 range, with bears having a slight advantage.

Great Britain

The clarification of the situation on Brexit and the lack of important data force the pound to go into the side range. Support for GBPU / SD 1.3052, resistance 1.3160, upward momentum is completed.

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

Indicator analysis. Daily review for February 1, 2019 for the pair EUR / USD

Strong calendar news is expected today at 11.55 (neutral), 4:30 pm (positive), 6:00 pm (positive) Moscow time.

Trend analysis (Fig. 1).

On Friday, the price before the news (16.30 Moscow time) will move up in the side channel. The first upper target 1.1502 is the resistance line (red bold line).

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Fig. 1 (daily schedule).

Comprehensive analysis:

- indicator analysis - up;

- Fibonacci levels - neutral;

- volumes - up;

- candlestick analysis - down;

- trend analysis - down;

- Bollinger lines - up;

- weekly schedule - up.

General conclusion:

On Friday, the price before the news (16.30 Moscow time) will move up in the side channel. The first upper target 1.1502 is the resistance line (red bold line).

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

Overview of the foreign exchange market on February 1, 2019

On the whole, it was a rather calm day yesterday, which is not surprising, since market participants had to take a breath after the meeting of the Federal Commission on Open Market Operations. The single European currency, as expected, fell a little, not only because of a rebound after a sharp rise on Wednesday but also because of preliminary GDP data, which showed a slowdown in economic growth from 1.6% to 1.2%. The level of unemployment in Europe remained unchanged, at around 7.9%. And it is precisely the negative because of GDP data that did not allow the single European currency to start growing against the background of American statistics. The fact is that the number of applications for unemployment benefits increased by 122 thousand, which is very, very much. In particular, the number of initial requests increased by 53 thousand, and repeated ones by 69 thousand. However, a little later the negative was somewhat smoothed by data on sales of new houses, which grew by 16.9% during the month, which is also impressive.

We should also pay attention to the ruble, which opened yesterday with a strong gap. This is a market reaction to the results of the meeting of the Federal Commission on Open Market Operations. It's just that these very results became known after the close of trading in the ruble, and investors played them back yesterday morning.

Today, a report by the US Department of Labor will be published, the content of which raises many concerns, especially against yesterday's data on applications for unemployment benefits. At the moment, it is predicted that absolutely all indicators will remain unchanged and the pace of creating new jobs will only slow down. If the previous report said that 312 thousand new jobs were created, now there should be only 165 thousand. However, this is still quite a lot, especially since in the previous period there were a lot of them. So if forecasts are confirmed, the dollar will be able to strengthen its position.

But European inflation data, albeit preliminary, is likely to be regarded very negatively. It is expected that inflation will slow down from 1.6% to 1.4%, which will really make everyone believe that until next year there will be no wait for an increase in the refinancing rate. So the single European currency will have to fall to 1.1400.

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The pound, which yesterday steadfastly held its ground, today can give up the slack. The reason may be the data on the index of business activity in the manufacturing sector, which should be reduced from 54.2 to 53.5. Thus, the pound will fall to 1.3050.

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Indicator analysis. Daily review for February 1, 2019 for the pair GBP / USD

Trend analysis (Fig. 1).

On Friday, the price before the news (16.30 Moscow time) will move down in the side channel. The first lower target 1.3042 is the rolling level of 23.6% (blue dashed line).

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Fig. 1 (daily schedule).

Comprehensive analysis:

- indicator analysis - down;

- Fibonacci levels - down;

- volumes - down;

- candlestick analysis - down;

- trend analysis - up;

- Bollinger lines - down;

- weekly schedule - down.

General conclusion:

On Friday, the price before the news (16.30 Moscow time) will move down in the side channel. The first lower target 1.3042 is the rolling level of 23.6% (blue dashed line).

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

Wave analysis of EUR / USD for February 1. Euro completed wave 2 and moved to a new downward wave

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Wave counting analysis:

On Thursday, January 31, trading ended with a 30 bp decline for the EUR / USD pair. Thus, the estimated wave 2 can be completed. If this assumption is true, then the decline of the instrument will continue within wave 3 with targets located about 13 figures and below. Even if the current wave counting is transformed into a three-wave one, the increase in quotations should not be higher than the maximum of wave c, after which, in any case, a descending wave with targets around 13 figures is expected. The unsuccessful attempt to break through the levels of 76.4% and 50.0% according to Fibonacci indirectly indicates the pair's readiness to decline.

Sales targets:

1,1289 - 0.0% Fibonacci

1.1215 - 0.0% Fibonacci

Shopping goals:

1.1502 - 76.4% Fibonacci

1.1569 - 100.0% Fibonacci

General conclusions and trading recommendations:

The pair supposedly completed the construction of the correctional wave 2. Thus, now I expect the tool to continue to decline with targets located near the marks of 1,1289 and 1.1215, which equates to 0.0% and 0.0% Fibonacci. The backup option provides for the complication of the upward wave of January 24, but the probability of this option is now extremely low.

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

GBP / USD. 1st of February. The trading system. "Regression Channels". American statistics can help overcome the moving

4-hour timeframe

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Technical details:

The senior linear regression channel: direction - sideways.

The younger linear regression channel: direction - up.

Moving average (20; smoothed) - up.

CCI: -61.2264

The currency pair GBP / USD on Friday, February 1, once again adjusted to the moving average line, but still cannot go below it. Very strange, as the clouds over the UK are beginning to thicken again. After all the amendments adopted by the British Parliament, Theresa May has no choice but to go on a new tour in Europe and try to negotiate with her leaders to make new concessions, which naturally relate to the Northern Irish border and the so-called back-stop. At the same time, the head of the European Commission, Jean-Claude Juncker, and the President of the European Council, Donald Tusk, have already noted that the agreement is not subject to revision, and the current version of Brexit is the best that the EU can offer the UK. Until Brexit remains about 2 months, and it remains unclear how Theresa May is going to bring together the desires of the parliament or leaders of the EU. Although an amendment was also adopted that does not allow Brexit to be postponed to a later date, according to many experts, Brexit will still have to be postponed, and both sides are waiting for new long negotiations, since no one wants a "tough" Brexit. Today in the UK, data on index of business activity in the production sector Markit will be published, but the main attention of traders, of course, will be focused on the package of macroeconomic news from the States, in which there is an extremely important NonFarm Payrolls.

Nearest support levels:

S1 - 1.3062

S2 - 1.3000

S3 - 1.2939

Nearest resistance levels:

R1 - 1.3123

R2 - 1.3184

R3 - 1.3245

Trading recommendations:

The currency pair GBP / USD has started a new round of correction. Thus, to open buy orders, you should wait for the Heikin Ashi indicator to turn up when the price is above the moving average. The target is 1.3184.

Sell orders are recommended to open when the pair closes below the moving average line with the first target of 1.3000. In this case, the tool can proceed to the formation of a new downtrend.

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

Explanations for illustrations:

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

The 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.

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

EUR / USD. 1st of February. The trading system. "Regression Channels". Reports of NonFarm Payrolls and wages in the US are

4-hour timeframe

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Technical details:

The senior linear regression channel: direction - up.

The junior linear regression channel: direction - down.

Moving average (20; smoothed) - up.

CCI: 8.5358

The last day ended with a rather unexpected decline of the EUR / USD pair to a moving average line. Unexpected, because before that, the trades were quiet low-volatility. Nevertheless, from the technical side, nothing supernatural happened. The pair has corrected, perhaps, before resuming the uptrend. If you look at the chart carefully, it becomes clear that the pair had difficulties in the past, overcoming the area of 1.1480 - 1.1510. Three and four times the pair turned around it. Therefore, the current downward reversal is absolutely logical, and a higher probability of overcoming the MA and a further decline in the area of 1.1290 - 1.1310. Today, February 1, in the European Union, it is planned to publish a preliminary inflation value for January. This report will not have a strong influence on the movement of the pair, however, it will reflect the trend, and it is already negative. The next slowdown in inflation is expected to 1.4%. In the States today, an important report on NonFarm Payrolls, as well as the unemployment rate, the index of business activity in the field of production of ISM and the change in average hourly wages will be released. This macroeconomic data package can have a strong impact on the pair, and if it does not fail, the US dollar will receive the necessary support.

Nearest support levels:

S1 - 1.1414

S2 - 1.1353

S3 - 1.1292

Nearest resistance levels:

R1 - 1.1475

R2 - 1.1536

R3 - 1.1597

Trading recommendations:

The currency pair EUR / USD has begun to adjust. New longs are recommended to open in case of a price rebound from the moving average line with the first target of 1.1475. The Heikin Ashi indicator can confirm the completion of the correction round.

It is recommended to open a sell position if traders overcome a moving average line and, preferably, a level of 1.1414 with a target of 1.1353. Today's reports in the States could trigger a boom in US currency.

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

Explanations for illustrations:

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

The 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 February 1. The euro started a new decline in the area of 1.1300

4h

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The currency pair EUR / USD rebounded from the correction level of 50.0% - 1.1517, a reversal in favor of the American currency and a close below the Fibo level of 38.2% - 1.1446. As a result, the process of falling quotations on February 1 can be continued in the direction of the next correction level of 23.6% - 1.1358. There is no indicator of the emerging divergences today. A close above the Fibo level of 38.2% will work in favor of the EU currency and return to the correction level of 50.0%.

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 currency pair continues to rise in quotations in the direction of the correction level of 100.0% - 1.1553. Rebounding the pair from this level will allow traders to expect a reversal in favor of the US dollar and on this chart, as well as a slight decline in the direction of the correctional level of 127.2% - 1.1285. Fixing the pair above the Fibo level of 100.0% will increase the likelihood of continued growth in the direction of the next correction level of 76.4% - 1.1789.

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

Recommendations to traders:

Purchases of the currency pair EUR / USD can be carried out with the target of 1.1517 if the pair closes above the level of 38.2%, and with a Stop Loss order under 1.1446.

Sales of the currency pair EUR / USD can be carried out now with the goal of 1.1358 with a Stop Loss order above the Fibo level of 38.2% since the pair completed the closure below the level of 1.1446.

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

Forecast for USD / JPY on February 1, 2019

USD / JPY

The growth of stock markets over the past two days overwhelmed the fears of investors trading in Japanese yen, concentrating on the problems of Great Britain, China, and Italy, and "persuaded" them to return to purchases again. Yesterday, the yen did not achieve a bit in reducing the support of the price channel line (108.27) and turned up. The reversal took place from the zero lines of the Marlin daily scale indicator. After the price leaves the level of 109.15 (minimum on January 29 and 22) a further price increase is possible to the designated target levels on the daily chart: 109.57, 110.42 (key level, as the Kruzenshtern line, runs here), 111.30.

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Analysis of GBP / USD Divergences for February 1. The pound sterling tends to fall

4h

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The currency pair GBP / USD on the 4-hour chart fixed above the Fibo level of 76.4% - 1.3094, which allows us to expect the pair to continue to grow in the direction of the correction level of 100.0% - 1.3300. Fixing quotes on February 1 under the Fibo level of 76.4% will work in favor of the American dollar and resuming the fall in the direction of the correction level of 61.8% - 1.2969. The ripening divergences today are not observed in any indicator.

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

1h

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On the hourly chart, after the formation of the bearish divergence at the MACD indicator, the pair reversed in favor of the US currency and began the process of falling in the direction of the correctional level of 161.8% - 1.3045. Rebounding the pair from this level will allow traders to count on a reversal in favor of the British pound and the resumption of growth in the direction of the correction level of 200.0% - 1.3187. Fixing the rate below the Fibo level of 161.8% will work in favor of continuing to fall in the direction of the correction level of 127.2% - 1.2916.

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 1.3187 and a Stop Loss order under the level of 161.8% if the pair bounces off the level of 1.3045 (hourly chart).

New sales of the currency pair GBP / USD will be possible with a target of 1.2916 and a Stop Loss order above the level of 161.8% if the pair closes below the level of 1.3045 (hourly chart).

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

Euro risks to continue falling

The single European currency in the world currency market came under pressure, which is most pronounced in tandem with the US dollar.

Euro currency at the end of the trading session on Thursday almost completely lost the news of its growth in tandem with the US dollar, which itself came under extensive sales due to the Fed's decision to make the dependence of further increases in interest rates on the dynamics of the US economy, as well as the overall financial market conditions. On Thursday, the euro fell markedly under the influence of a number of negative data on the German economy, which is a leader in Europe and the eurozone.

According to the data presented, the volume of retail sales in Germany fell in December by 2.1% against the growth in the previous period under review by 1.1%. On an annualized basis in December, the indicator showed a strong decline of 4.3% against a year earlier growth of 1.4% and expectations of a decline of only 0.5%. Also added fuel to the fire and employment data, which showed a decrease in the number of unemployed by 2,000 in January. In December, the indicator was measured at -14,000 and it was assumed that the January value would show a decrease of 11,000.

In addition to these data, GDP was published for Spain, which maintained a growth rate of 2.4%, Italy, where the risk of dumping the local economy in recession and the eurozone, in which the growth rate of the economy hung in quarterly terms at around 0.2%, and continued to drop 1.2% from 1.4%.

The ECB is very worried about the economic situation in Italy, which already shows a negative trend in quarterly data. Thus, in the fourth quarter of 2018, the country's economy shrank by 0.2% against a decrease of 0.1% earlier. Annual GDP shows growth at the level of statistical error by 0.1% versus 0.6% a year earlier and expectations are for a 0.3% increase.

Similar data, which may be slightly better or slightly worse, is also observed in other eurozone member countries. Such dynamics may be the reason that the ECB not only does not dare to raise interest rates this year but may even be forced to secretly resume measures to stimulate the region's economy. In this case, the single currency risks to continue falling in the foreign exchange market.

Today, data on consumer inflation in the eurozone will be published, and if they again show a slowdown in growth, this will stimulate further local depreciation of the euro currency.

Forecast of the day:

The currency pair EUR / USD is above the level of 1.1425, pending the publication of data on consumer inflation in the eurozone. If they show a decline, and employment values in the United States, on the contrary, are positive, the pair may, breaking the level of 1.1425, fall to 1.1365. At the same time, if the data from the United States turns out to be negative, and the rate of consumer inflation in the eurozone continues, the pair may locally grow to 1.1500-1.1515.

The currency pair USD / JPY is below the level of 109.00. Negative news from the US labor market may cause the pair to continue to decline to 108.00. Positive, on the contrary, will contribute to its growth to 109.65.

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

Simplified wave analysis of EUR / JPY for February 1

Large-scale graphics:

The bearish wave of the cross-country that set the main motion vector all last year has all the signs of completion. Its structure is fully formed, the proportions of the entire parts are met. The price is within a fairly strong support.

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Medium scale graphics:

The rising wave, which began on January 3, continues in flat form to gain the wave level necessary for a further breakthrough. Its high potential allows us to expect a change in the entire short-term trend from the beginning movement.

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Small-scale graphics:

A descending wave of January 9 formed a flat corridor. A preliminary analysis of the structure indicates a high probability of the completion of the entire wave in the coming week.

Forecast and recommendations:

On the pair chart, there are strong reversal signals that make sales hopeless in the coming month. It is recommended to use all suitable trading signals to enter long positions. Breaking up may coincide in time with the release of news blocks.

Resistance zones:

- 126.70 / 127.20

- 125.20 / 125.70

Support areas:

- 123.80 / 123.30

Explanatory notes for the figures: The simplified wave analysis uses waves consisting of 3 parts (A – B – C). The analysis uses 3 consecutive scale graph. 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.

Note: 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

GBP/USD Approaching Support, Prepare For A Bounce

GBP/USD is approaching its support at 1.3003 (100% Fibonacci extension, 50%, 38.2% & 23.6% Fibonacci retracement, horizontal pullback support) where it could potentially bounce to its resistance at 1.3154 (78.6% Fibonacci retracement, Horizontal swing high resistance).

Stochastic (55, 5, 3) is approaching its support at 4% where a corresponding bounce could occur.

GBP/USD is approaching its support where we expect to see a bounce.

Buy above 1.3003. Stop loss at 1.2888. Take profit at 1.3154.

analytics5c53f7026d5ea.png

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

Wave analysis of GBP / USD for February 1. The pound should grow, but the news can push it down

analytics5c53f64401b9c.png

Wave counting analysis:

On January 31, the GBP / USD pair lost only a few points, so the current wave counting is not broken and still presumes the construction of an upward wave of 5, at 3. This option is still in doubt due to the news background. As before, no particularly positive and encouraging news comes from the UK. Thus, the main hope of the pound is negative from America. New Shutdown, the mess with the construction of the Trump wall, weak economic indicators - everything fits. . Otherwise, the pound will be extremely difficult to continue to increase and work out the current wave counting.

Shopping goals:

1,3297 - 127.2% Fibonacci

1.3367 - 127.2% Fibonacci

Sales targets:

1.2996 - 76.4% Fibonacci

1.2889 - 61.8% Fibonacci

General conclusions and trading recommendations:

The wave pattern assumes the construction of wave 5, 3. Thus, I expect the resumption of the increase and recommend buying the instrument with targets near the estimated level of 1.3397, which equals 127.2% Fibonacci. Breakthrough of the current minimum of wave 4, in 3 will cancel the execution of the main variant. News from the US today (unemployment, wages and the number of jobs outside the agricultural sector) should help determine which way the market is looking.

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Burning forecast 01/02/2019

EURUSD: The momentum from the Federal Reserve was not enough for the euro to exit the long range. Faced with strong resistance - a long-term downtrend line at the level of 1.1500 - the euro broke through to 1.1515 - but failed to consolidate higher.

We are waiting for a momentum from the employment data for January on Friday, February 1, at 0:30 pm London time.

If the data comes out weak - we expect a breakthrough to the top 1.1515 - buy from 1.1515.

In the case of a turn downwards sell from 1.1285.

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Technical analysis for EUR/USD for February 1, 2019

EUR/USD briefly peaked above 1.15 and as expected has turned lower. Like in early January as I explained in our last analysis, with the Daily RSI overbought and price at the 78.6% Fibonacci retracement level, the chances for a rejection and reversal were high.

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Blue rectangle- major support area

Red line - short-term support trend line

Green rectangles - reversal pattern repeating

EUR/USD got rejected at the 78.6% Fibonacci level and has also broken the short-term trend line support. Major support is found at 1.14. If we break and close the day below it, then we could talk about a similar reversal and bearish move starting like in early January when EUR/USD peaked at 1.1570. As long as EUR/USD is above 1.14 the battle between bulls and bears is still on. A lower high could have formed and this would be confirmed on a break below 1.14. This would be a very bearish sign. On the other hand, bulls want to see EUR/USD price break above yesterday highs and hold above 1.14. So far this pullback can be seen as a backtest of the break out area at 1.14-1.1430. Holding above it will support the bullish scenario. Breaking below it will open the way for a move towards 1.13 and lower.

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Technical analysis for Gold for February 1, 2019

Gold price has reached our target area and has stopped its rise after reaching $1,326. Gold price is now expected to move lower towards $1,300. Gold price has already lost 10$ from its highs but I believe we should expect more downside.

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Purple lines - bullish channel

Gold price remains in a bullish trend. Price continues to make higher highs and higher lows but I now expect Gold to make a pull back. Support is found at $1,300 and next at $1,280. As long as Gold price is above $1,280 the medium-term bullish trend is intact and our next target is at $1,350. Gold price however at least in the short-term is expected to make a pull back towards the previously resistance level of $1,300 as a back test. If price holds above $1,300 and starts a bounce, this would be a bullish sign implying we could be heading towards $1,350. If price breaks below $1,300 we should keep a close look on $1,280 because if we break the bullish channel then the entire bullish trend will be over.

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AUD/USD Approaching Support, Prepare For A Bounce

AUD/USD is approaching its support at 0.7232 (100% Fibonacci extension, 38.2% Fibonacci retracement, horizontal pullback support) where it could potentially bounce to its resistance at 0.7289 (horizontal swing high resistance).

Stochastic (55, 5, 3) is approaching its support at 2.5% where a corresponding bounce could occur.

AUD/USD is approaching its support where we expect to see a bounce.

Buy above 0.72321. Stop loss at 0.71955. Take profit at 0.7289.

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Forecast for GBP/USD on February 1, 2019

GBP/USD

Yesterday, the British pound did not withstand the dollar pressure of almost all markets - it fell against the dollar currency, cheaper precious metals, raw materials and agricultural products were declining. US government bonds are actively buying up; their yields (as a whole) have been falling for the 4th consecutive day. In general, the market is preparing for massive buying up of US debt as soon as the national debt limit is raised. The Treasury has already announced $365 billion in the first quarter. Taking into account that January simply fell out of this plan (net attraction amounted to 42 billion), the increase in the remaining time will be simply unprecedented. And this is an additional strong factor in the increased demand for dollars.

On the four-hour chart, the price this morning is trying to consolidate below the Krusenstern line (blue indicator). We look forward to reducing the pound to support the price channel line of the daily chart at 1.3010. In the event of a price going below the level, a decline to the Krusenstern line on the daily chart is likely - 1.2880.

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