GBP/USD: plan for the US session on May 14. Buyers are trying to build new support around 1.2930

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

The divergence on the MACD indicator, which I paid attention to in the morning forecast, helped the buyers of the pound to stop the fall and form a small upward correction. While trading is above the support of 1.2930, we can expect the growth of GBP/USD in the area of the morning resistance of 1.2990, where I recommend fixing the profits. In the scenario of breakdown and further movement along with the trend, it is best to consider long positions on the rebound from the minimum of 1.2877.

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

The bears made an attempt to continue the downward movement of the pound after a weak report on the UK labor market, but it did not come to a major sale. In the afternoon, the goal will be the breakdown and consolidation below the support of 1.2930, which will lead the pair to a new weekly minimum in the area of 1.2877, where I recommend fixing the profits. With the growth of the pound, it is possible to consider short positions on the rebound from the morning resistance level of 1.2990.

Indicator signals:

Moving Averages

Trading is below 30 and 50 moving averages, which indicates the bearish nature of the market.

Bollinger Bands

The volatility of the indicator has decreased, which does not give signals on entering 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
The material has been provided by InstaForex Company - www.instaforex.com

EUR/USD: plan for the US session on May 14. Inflation in Germany did not come as a surprise. Euro remains in the channel

To open long positions on EURUSD, you need:

Inflation in Germany was quite predictable, so buyers of the euro have not been able to return above the level of 1.1251, which remains the task for the second half of the day. Only a breakthrough of this range will keep the upward momentum and will lead to an update of the highs in the area of 1.1275 and 1.1299, where I recommend fixing the profits. In the case of good reports on the US, the pressure on the euro will remain. In such a scenario, it is best to return to long positions on a false breakdown from a minimum of 1.1219 or a rebound from a higher level of 1.1188.

To open short positions on EURUSD, you need:

The bears did not even have to defend the level of 1.1251, which primarily indicates the absence of real buyers of the euro. The task for the second half of the day is a correction to the intermediate support area of 1.1219, however, the main purpose of the bears today will be to return and consolidate below this level, which will push the EUR/USD pair down to the minimum area of 1.1188, where I recommend fixing the profits. In the scenario of further growth of the euro, it is best to open short positions on the rebound from the maximum of 1.1275 or even higher – around 1.1300.

Indicator signals:

Moving Averages

Trading is conducted in the area of 30 and 50 moving averages, which indicates the continuation of the lateral nature of the market.

Bollinger Bands

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

Australian dollar compensates for losses

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The Australian dollar and the offshore yuan returned to growth after US President Donald Trump announced that trade negotiations between China and the US will be successful. Earlier, China announced that it would raise tariffs for goods in the amount of $60 billion in response to Washington's decision to increase fees on Chinese imports by $200 billion. Although it takes time for the volatility to fully settle, risk-sensitive currencies, including the offshore yuan and the Australian dollar, feel good after Trump comments. It should be noted that the statement of Beijing about the increase of tariffs on American goods activated movement in the currency market. The move was unexpected, and therefore movements in the foreign exchange market were quite significant. However, despite the fact that Trump is confident that trade negotiations will be successful, we should not forget that success for him will not necessarily be a success for China.

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The Australian dollar still manages to compensate for the recent losses. Recall that the currency reacts sharply to news from China since the Australian economy depends on exports, and China is the main trading partner. So in the near future, one should not expect a decrease in volatility. In general, it is expected that market sentiment should not deteriorate in anticipation of Trump and X meeting next month. Despite the fact that there was a lot of negative news, most of them have already played the market.

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EURUSD: Negotiations between the US and China will continue during the G-20 summit. The growth potential of the euro at risk

China's response was not long in coming. If at the end of last week, the US raised duties on imported goods from China, then yesterday Beijing announced that it would increase duties on imports of goods from the US in the amount of about $60 billion. Duties will be effective from June on a number of American goods and will increase to 25% from the current 5% -10%. The State Council of China said that this step was taken after the US imposed punitive duties on Chinese goods worth $200 billion at a rate of 25%.

However, we should not forget that the White House has repeatedly warned that in case of retaliatory measures, a package of new duties on Chinese goods will already be prepared worth $300 billion.

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Yesterday, US President Donald Trump said that China has been doing well for many years at the expense of the United States. However, despite trade differences, Trump plans to meet with representatives of China at the G-20 summit. According to him, the United States and China are in an excellent position, regardless of whether an agreement will be concluded. The US President also noted that the decision on duties on additional goods from China was not taken.

As for fundamental statistics, attention was attracted only by the report of the Federal Reserve Bank of New York, in which it was indicated that inflation expectations were lower. According to the data, in April of this year, consumer expectations for future price growth decreased. It is predicted that in a year, inflation will reach 2.6%, and in three years – 2.7%. Expectations for future revenues also weakened, showing an increase of only 2.4% against 2.6%.

Yesterday's speeches of the Fed representatives were of a formal nature.

On Monday, the President of the Federal Reserve Bank of Boston, Eric Rosengren, said that the ongoing trade conflicts could harm the global economy, but it is still too early to assess the effects of recent trade disputes between the US and China, as countries can still manage to conclude a trade agreement.

Rosengren also noted that the Fed's policy should focus on short-term prospects since the Committee had the opportunity to take the time to make changes in monetary policy. According to the representative of the Fed, the current level of interest rates is quite acceptable and does not require adjustment.

As for the technical picture of the EURUSD pair, yesterday's attempt by the bulls to resume the upward trend was unsuccessful, which puts the current short-term trend at risk. It is best to consider long positions in the trading instrument after correction to the support of 1.1220 or from a larger minimum of 1.1180, which coincides with the lower border of the side channel. The entire focus of buyers today will be shifted to the resistance level of 1.1250, the breakthrough of which will strengthen the upward momentum in the trading instrument.

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GBP/USD. May 14. Trading system "Regression Channels". The Labor Party and the Conservatives are in negotiations for Brexit

4-hour timeframe

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Technical data:

The upper linear regression channel: direction – down.

The lower linear regression channel: direction – up.

The moving average (20; smoothed) – down.

CCI: -154.9833

On Tuesday, May 14, the British pound continues the downward movement. Trump's statement yesterday about threats to introduce new duties to China and demands to sign a trade agreement in the near future, rather than wait for the 2020 election, helped him in this. The dollar has previously responded favorably to the escalation of the trade conflict with China. Now, the factors that support the dollar paired with the pound are much more than the opposite. In the meantime, it became known that the two ruling parties of Great Britain, the Conservatives and the Labor Party, once again sat down at the negotiating table, trying to find a way out of the EU, which would find support in Parliament. However, most likely, we are talking only about the revision of the version of the agreement of Theresa May, as the EU agrees only to this option of "deal" and is not going to conduct new negotiations on this issue. Laborites are even ready to vote for the "deal" in Parliament, if after that it will be put to a popular vote, then to the second referendum. However, Theresa May is fundamentally against the second referendum, and even the question arises, why? Because the referendum may end with the rejection of Brexit, and this will mean a complete political collapse of Theresa May. Thus, both parties are very far from consensus.

Nearest support levels:

S1 – 1.2939

S2 – 1.2909

S3 – 1.2878

Nearest resistance levels:

R1 – 1.2970

R2 – 1.3000

R3 – 1.3031

Trading recommendations:

The GBP/USD pair has overcome the moving average and continues to move down. Thus, short positions with the targets at 1.2939 and 1.2878 are relevant now, before the reversal of the Heiken Ashi indicator to the top.

Buy-positions are recommended to be considered only after the pair is reversed above the moving average with the first targets at 1.3062 and 1.3092. In this case, the bulls will get a new chance to form an upward trend.

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

Explanation of illustrations:

The upper linear regression channel – blue lines of the unidirectional movement.

The lower linear regression channel – purple lines of the unidirectional movement.

CCI – 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.

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

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

EUR/USD. May 14. Trading system "Regression Channels". China is not afraid of Trump's threats

4-hour timeframe

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Technical data:

The upper linear regression channel: direction – down.

The lower linear regression channel: direction – down.

The moving average (20; smoothed) – up.

CCI: 82.5944

The previous chapter of the trade war between Beijing and Washington ended with the imposition of a 25% duty by Trump on Chinese imports totaling about $ 200 billion. However, as we expected, despite Trump's threats to introduce new duties that will cover all Chinese imports, Beijing announced the introduction of its duties in the amount of $60 billio on US goods. Their action will begin on June 1, 2019. Recall that imports from China to the United States is approximately 500 billion, and in the opposite direction – about 150 billion. It is unambiguously clear who is a less profitable trade war. But China seems to clearly understand that if you make concessions to Trump, then everything can end with more new requirements, the desire to get more concessions. Thus, Beijing continues to resist, and negotiations continue despite the mutual introduction of duties. Now, the next move is for Trump, who is probably frantic now, given his recent statement that China should not respond to the imposition of duties, as "it will only get worse." In the near future, through his Twitter, Trump may announce the introduction of a new package of duties, which, most likely, China will respond again.

Nearest support levels:

S1 – 1.1230

S2 – 1.1169

S3 – 1.1108

Nearest resistance levels:

R1 – 1.1292

R2 – 1.1353

R3 – 1.1414

Trading recommendations:

The EUR/USD currency pair has started a new round of downward correction. Thus, after the correction is completed, it is recommended to trade for an increase with targets located near the level of 1.1292.

It is recommended to consider short positions on the pair not earlier than fixing the price below the moving average line with the first target at 1.1169.

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

Explanation of illustrations:

The upper linear regression channel – blue lines of the unidirectional movement.

The lower linear regression channel – purple lines of the unidirectional movement.

CCI – the 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.

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

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

Simplified wave analysis and forecast for EUR/USD and GBP/USD on May 14

EUR/USD

The trend direction on the short-term chart of the euro since March 20 looks at the "south". In the wave structure, the first 2 parts are fully formed (A + B). From May 1, the first part of the bearish reversal structure develops. The price is located at the lower edge of a wide area of potential large-scale reversal. There are no reversal signals on the chart yet.

Forecast:

Today, it is expected to maintain the overall flat mood of movements. In the first half of the day, the probability of repeated pressure on the resistance zone remains. Before changing the course of the intersessional trend, a short-term price jerk is not excluded. The nearest support will limit the size of the daily move down.

Recommendations:

Purchases of European pairs today are very risky, they can only be used when "scalping". It is recommended to refrain from trading on the euro until clear reversal signals appear. The turnaround time is often correlated with the release of news blocks.

Resistance zones:

- 1.1250 / 1.1280

Support zones:

- 1.1180 / 1.1150

- 1.1090 / 1.1060

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GBP/USD

The pound chart is dominated by a bearish wave. Its last section started on May 3, it completes a larger structure. The price has reached a fairly strong support level with TF D1.

Forecast:

From the current zone, there is a high probability of the beginning of the counter correction, at least in the form of a flat. The duration of this phase of the movement can be quite long.

Recommendations:

There are no conditions for selling the pound today. Supporters of intra-session trading can use short-term purchases of the pair, while the lot used is more reasonable to reduce. In the area of the calculated resistance, it is recommended to monitor the signals of the instrument sale.

Resistance zones:

- 1.3010 / 1.3040

Support zones:

- 1.2950 / 1.2920

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Explanations to the figures: Waves in the simplified wave analysis consist of 3 parts (A – B – C). The last unfinished wave is analyzed. Zones show areas with the highest probability of reversal. The arrows indicate the wave marking according to the method used by the author, the solid background is the formed structure, the dotted ones are the expected movements.

Note: The wave algorithm does not take into account the duration of tool movements over time.

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Bitcoin. Bitcoin 8000 USD. Amazon plans to accept bitcoins as a payment

Bitcoin has overcome the mark of 8000 USD after the appearance of the next news, which will support the rate in the long term. Yesterday, several large US chain stores announced the imminent appearance of the possibility of paying for goods with cryptocurrencies. We are talking about such giants as Amazon and its Whole Foods food chain.

Signal to buy Bitcoin (BTC):

The psychological test of 8000 USD did not scare off new potential investors. Bitcoin continues to trade in this range, retaining its upward potential. The next buyers' target will be highs around 8200 and 8450, where I recommend fixing the profits. In the downward correction scenario, the support will be provided by the area of 7600, and you can buy Bitcoin immediately on the rebound in the area of 7200.

Signal to sell Bitcoin (BTC):

Only the formation of a false breakdown of the new high of 8200 will be the first signal to sell Bitcoin to reduce to the lower limit of 7600 and update a larger support area of 7200, where I recommend fixing the profits. With further growth along with the trend, it is best to consider selling a rebound from a maximum of 8500.

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

Analysis of EUR/USD divergences for May 14. Two rebounds and bearish divergence cannot yet stop the growth of the euro

4h

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As seen on the 4-hour chart, the EUR/USD pair performed a reversed in favor of the US dollar after the formation of a bearish divergence at the CCI indicator. As a result, on May 14, the process of falling quotations can be continued in the direction of the retracement level of 100.0% (1.1177). Closing of the pair above the Fibo level of 76.4% (1.1241) can again be interpreted as a reversal in favor of the euro and expect a resumption of growth in the direction of the retracement level of 61.8% (1.1281), especially in conjunction with the last peak of divergence.

The Fibo grid is built according to the extremes of March 7, 2019, and March 20, 2019.

Daily

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As seen on the 24-hour chart, the picture remains the opposite. The pair is trading below the retracement level of 127.2% (1.1285) that keeps the probability of a resumption of falling prices towards the Fibonacci level of 161.8% (1.0941). Fixing the pair above the retracement level of 127.2% will work in favor of the European currency and will allow counting on some growth in the direction of the retracement level of 100.0% (1.1553). There are no emerging divergences on the current chart today.

The Fibo grid is built according to the extremes of November 7, 2017, and February 16, 2018.

Forecast for EUR/USD and trading recommendations:

Buy deals on EUR/USD pair can be opened with the target at 1.1281 if the pair closes above the level of 76.4%. The stop loss order should be placed below the level of 1.1241.

Sell deals on EUR/USD pair can be opened with the target at 1.1177, with a stop loss order above the level of 1.1241, since a bearish divergence was formed.

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

Analysis of GBP/USD divergences for May 14. The pound is clearly falling from level to level

4h

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As seen on the 4-hour chart, the GBP/USD pair performed a reversal in favor of the US dollar and consolidation under the retracement level of 61.8% (1.2969). Thus, the fall of quotations can be continued in the direction of the next retracement level of 50.0% (1.2867). There are no emerging divergences on the current chart today. The consolidation of quotations above the Fibo level of 61.8% will work in favor of the pound and the resumption of growth in the direction of the retracement level of 76.4% (1.3094).

The Fibo grid is built according to the extremes of September 20, 2018, and January 3, 2019.

1h

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As seen on the hourly chart, the GBP/USD pair rebounded from the Fibo level of 50.0% (1.3031), the third in a row, a reversal in favor of the US dollar and a fall to the retracement level of 23.6% (1.2943). Two rebounds from this level allowed the pair to perform a reversal in favor of the British pound and begin the process of returning to the Fibo level of 38.2% (1.2992). The consolidation of quotations under the level of 23.6% will increase the chances of the pair to further fall in the direction of the next retracement level of 0.0% (1.2865).

The Fibo grid is built according to the extremes of Apri,l 3, 2019 and April 25, 2019.

Forecast for GBP/USD and trading recommendations:

Buy deals on GBP/USD pair can be opened with the target at 1.2992 and a stop loss order under the retracement level of 23.6% since the pair has rebounded from the level of 1.2943 (hourly chart).

Sell deals on GBP/USD pair can be opened with the target at 1.2865 and a stop loss order above the level of 23.6% if the pair completes the retracement level of 1.2943 (hourly chart).

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

"Swing" of oil quotes disturb the market

Rising oil prices continue to amaze market participants. On Monday, May 13, it rose by 3% but this is not the limit, analysts say. Experts are trying to figure out how dangerous the current rise in oil prices will follow if a sharp rise is no less deafening collapse.

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On Monday, Brent quotes reached $ 72.5, which is 2.5% higher than the previous close. Analysts believe one of the growth drivers is data from Russia, which for the first time since the beginning of the year, fulfilled its obligations under the OPEC + transaction by 100%. In the current month, the volume of daily average oil production in the Russian Federation decreased by 230 thousand barrels per day to 11.168 million barrels per day.

Experts note that the negative external background and the collapse of futures for US indices do not affect the growth of oil prices. They are confidently moving upwards but experts find it difficult to answer how long this movement will last.

The situation is complicated by the escalation of the trade war between the United States and China. Recall that this weekend, US President Donald Trump ordered to prepare an increase in duties on Chinese goods by $ 300 billion. At the same time, he warned about the further aggravation of the trade standoff in the event of a response from China. However, the Chinese authorities have introduced retaliatory tariffs and intend to defend their position. World markets are in limbo, and market players are closely watching the development of the conflict.

According to analysts, the current news background, even taking into account the reduction in oil production, did not contribute to a full-fledged rally in the black gold market. Experts believed that at the moment the market acts out technical factors and the rapid growth may be replaced by no less explosive fall.

The continuing tension between the two leading economies of the world stirs the markets and has a negative impact on the growth forecasts of the global economy, experts concluded.

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Oil tankers to the bottom

When a number of bullish news is already taken into account in prices and market attention shifts to the escalation of the US-Chinese trade war that threatens to undermine global oil demand, the growth of bearish prices by 39% for WTI in the week to May 7 looks logical. Speculators increased short-selling at the fastest rates over the past 8 months against the background of Donald Trump's angry tweets with threats in the form of an increase in tariffs from 10% to 25% of $200 billion worth of Chinese imports. They were brought to life, therefore, you should not be surprised at the fall of black gold to the area of 6-week lows.

Dynamics of speculative positions on oil

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China is the largest consumer of raw materials worldwide, thus, the slowdown in its economy is rightly viewed as negative for Brent and WTI. If in April-September 2018, the Celestial Empire imported 60.5 million barrels from the States, the figure dropped to a ridiculous 1.64 million barrels in October-March. For four of these six months, there were no purchases at all.

Dynamics of American oil imports to China

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The intention of the White House to impose tariffs on all Chinese imports will not pass smoothly for the US economy. UBS estimates that it will lose 0.75-1 ppt. over the course of a year, while US stock indexes will collapse by two digits. The trade war will create even more problems for China and the closely related eurozone and Japan. As a result of the global economic slowdown, global oil demand will be severely affected. The speculators felt it very subtly but failed to take into account the surprise from the Middle East.

Four tankers were attacked in the Persian Gulf, two of them belonged to Saudi Arabia. Iran has repeatedly threatened the United States to block the Strait of Hormuz, through which about 40% of the international trade in black gold goes. All exports of oil from Kuwait, Iran, Qatar, and Bahrain while 90% of deliveries from Saudi Arabia and Iraq, and 75% from the UAE are associated in this area. The escalation of the conflict is fraught with serious disruptions in the sphere of supply, which will throw up prices. However, until the investigation is over, the market prefers to regain the factor of the US-Chinese trade war. The United States naturally accuses Iran of an attack, but first, we need evidence. Second, it's not a fact that the attacks will continue.

The bulls have not yet managed to play their Trump card and the initiative has returned to the bears. The worst daily peak of US stock indices from December-January was backfired by a decrease in Brent futures quotes to the 6-week bottom area. If the US dollar also remembered its exploits in 2018 when it took the status of the main asset-seeker from the Japanese yen and gold against the background of trade wars then the positions of Brent and WTI would be unenviable. So far, the "American" feels uncomfortable as the increase in geopolitical risks increases the likelihood of a Fed rate cut.

Technically, only the output of North Sea-grade quotes outside the consolidation range of $68.45 to 72.75 per barrel will allow determining the direction of further movement.

Brent daily chart

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Trump put all at stake: selling AUD/USD and USD/JPY pairs

US President Donald Trump increased the pressure on China in order to achieve a new and more profitable trade agreement for his country. Moreover, he obviously does this in order to push the Chinese side to take active steps in the negotiation process.

Trump obviously put everything in stake, hoping that the Chinese would "break down", fearing the prospects of getting an increase in customs duties to 25% for another 300 billion dollars. Yet they responded with retaliatory measures, which was the reason for the sharp collapse of major as US stock indices lost more than 2.0% and the high-tech NASDAQ with 3.41% on Monday. Such a noticeable drop was noted only at the end of 2018 when the Fed raised interest rates and made it clear that they could raise them twice more in the next 2019.

The US government debt market has resumed the dynamics of growth in demand for government bonds, resulting in a fall in the yield accordingly. Thus, the benchmark yield for the 10-year treasuries on the basis of trading on Monday fell from Friday's closing level of 2.473% to 2.401%. Thus, it continued to decline to the local minimum of March 28 of this year.

On the basis of trading results on Monday , the US dollar rose against all major currencies in the foreign exchange market with the exception of the Japanese and Swiss currencies, which clearly fits into the general trend of investor risk aversion.

Yesterday's collapse of the US stock market clearly demonstrated that bidders were clearly nervous and doubt that Trump's pressure on Beijing could lead to the conclusion of a contract. They were afraid that it may turn out to be zilch and only aggravated the general situation in the global economy. It is expected that the escalation of the trade war will lead to the Chinese side losing about 4.0% of GDP but America also cannot avoid a strike since its GDP may drop by more than 2.0%. While in the current situation, the US president continues to "feed" the markets with optimism about the positive prospects for the negotiation process, investors began to doubt this.

Assessing the general situation, it can be assumed that the escalation of the trade war between Washington and Beijing will contribute to the growth of volatility in the stock markets. At the same time, one should probably not expect the formation of any clearly expressed trends on the foreign exchange market. Negative news or rumors will support the demand for safe-haven currencies, including the US dollar, but at the same time, any positive news will definitely push up hopes for an early resolution of the crisis. In turn, this will put pressure on the dollar in a perspective. If the Fed does not decide on new incentive measures, the dollar can generally continue to grow against most major currencies.

Forecast of the day:

The AUD/USD pair is trading below the support level of 0.6965 against the background of the escalating trade crisis between the US and China. If the price holds below the level of 0.6965 and drops below the level of 0.6940, we should expect the continuation of its fall to 0.6900.

The USD/JPY pair has recovered from yesterday's fall. However, if it remains below 109.70 in the wake of the negativity remaining in the markets, it may continue to fall to 108.55.

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GBP / USD plan for the European session on May 14. The pressure on the pound may continue

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

Pound buyers, for stopping a downtrend, need to form a false breakdown in the support area of 1.2943 with confirmation of divergence on the MACD indicator. Only after that, it will be possible to count on a repeated upward correction in the area of resistance 1.2990, as well as on updating the maximum of 1.3037, where I recommend taking profits. In the case of a further decline in the GBP/USD pair, it is best to look at long positions for a rebound from a low of 1.2905.

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

A weak report on the UK labor market may maintain pressure on the pound in the first half of the day and the formation of a false breakdown in the area of resistance at 1.2990 will be an additional signal to open short positions. The sellers will target the lows of 1.2905 and 1.2866, where I recommend taking profits. However, it is important to be careful in selling the pair for the breakdown of support at 1.2943, which eliminates the divergence that can be formed on the MACD indicator. In the case of the growth of the pound on the data above the resistance of 1.2990, you can sell for a rebound from the maximum of 1.3037.

Indicator signals:

Moving averages

Trading is below 30 and 50 moving averages, which indicates the bearish nature of the market.

Bollinger bands

In the case of a further decrease in the pound, support will be provided by the lower limit of the indicator in the area of 1.2922, where divergence can be formed on the MACD indicator. The resistance is the upper limit in the area of 1.3015.

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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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Technical analysis of EUR/USD for May 14, 2019

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Overview:

The EUR/USD pair continues to move downwards from the level of 1.1192. Last week, the pair dropped from the level of 1.1192 to the bottom around 1.1111. Today, the first resistance level is seen at 1.1192 followed by 1.1216, while daily support 1 is seen at 1.1111. According to the previous events, the EUR/USD pair is still moving between the levels of 1.1192 and 1.1111; for that we expect a range of 81 pips. If the EUR/USD pair fails to break through the resistance level of 1.1111, the market will decline further to 1.1069. This would suggest a bearish market because the RSI indicator is still in a positive area and does not show any trend-reversal signs. The pair is expected to drop lower towards at least 1.1069 with a view to test the second support. On the other hand, if a breakout takes place at the resistance level of 1.1192 (major resistance), then this scenario may become invalidated.

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EUR / USD plan for the European session on May 14. Euro buyers started having problems with growth

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

Yesterday, the bulls failed to keep trading above the level of 1.1241. Today, euro buyers need to return and consolidate above the new resistance of 1.1251 in the first half of the day, which will maintain an upward momentum and lead to an update of the highs around 1.1275 and 1.1299, where I recommend taking profits. However, plans for bulls can violate the fundamental data for the euro area. The pressure on the euro will increase in case of weak reports. In such a scenario, it is best to return to long positions on a false breakdown from a minimum of 1.1219 or a rebound from a higher level of 1.1188.

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

The formation of a false breakdown in the area of resistance at 1.1251 will be the first signal to open short positions in the euro, which will also help form the upper limit of the new downward channel. This will lead to a correction in the intermediate support area of 1.1219. However, the main purpose of the bears today is to return and consolidate below this level, which will push the downward movement of the EUR/USD pair to the area of 1.1188, where I recommend taking profits. Under the scenario of further growth of the euro, it is best to open short positions to a rebound from a maximum of 1.1275 or even higher around 1.1300.

Indicator signals:

Moving averages

Trade is conducted in the region of 30 and 50 medium moving, which indicates a possible completion of the bullish market.

Bollinger bands

The growth of the euro will resume only in the event of a breakdown of the upper boundary of the indicator in the region of 1.1251, while the pressure will increase after fixing below the lower boundary in the region of 1.1219.

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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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Technical analysis of AUD/USD for May 14, 2019

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Overview:

The AUD/USD pair is set above strong support at the levels of 0.7046 and 0.7168. This support has been rejected four times confirming the uptrend. The 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 thae 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 0.7290. The level of 0.7389 will act as the 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

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Wave analysis of GBP / USD for May 14. The Briton is confused.

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Wave counting analysis:

On May 13, the GBP / USD pair lost about 50 basis points. However, this did not affect the clarification of the current wave marking. Moreover, the wave pattern is completely confusing. If you look at the part of the trend that takes its start on February 27, then it is obvious that the very concept of a "trend" does not apply to it. Even internal correctional and impulse waves in the composition of more global waves look out of the box, and difficult. All this suggests a flat. Despite the fact that the pound sterling is still prone to decline due to the negative news background from the UK, I recommend first of all caution when trading in any direction. Any wave can now be interpreted differently, forecasts for more than one or two days should not be made.

Purchase goals:

1.3182 - 61.8% Fibonacci

1,3259 - 76.4% Fibonacci

Sales targets:

1.2867 - 0.0% Fibonacci

General conclusions and trading recommendations:

Wave picture suggests a continuation of the pair 's decline. Mostly negative messages continue to come from the UK, which may lead to new pound drops in the future. Thus, I now recommend selling the pair with targets around 1.2867, which corresponds to 0.0% Fibonacci.

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Wave analysis of EUR / USD for May 14. Mutual introduction of duties of the USA and China is not particularly worried about

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Wave counting analysis:

On Monday, May 13, trading ended for EUR / USD by 15 bp decline. However, during the day, the pair had an attempt to break through the previous supposed peak of wave 2. Thus, there is a growing chance that wave 2 will take on a clearly marked three-wave shape or the entire wave marking will change. While the working variant remains the option of building a downward trend, in particular, wave 3, 3, 3. The news background for the EUR / USD pair remains neutral, although the news about the clash between the leaders of the United States and China gets to be heard. However, the market activity on the current instrument is now clearly low, which casts doubt on the influence of the news background on the instrument movement.

Sales targets:

1.1097 - 161.8% Fibonacci

1.1045 - 200.0% Fibonacci

Purchase goals:

1.1324 - 0.0% Fibonacci

General conclusions and trading recommendations:

The pair retains the prospects for building a downward trend. The current wave counting assumes the resumption of the pair reduction with the targets of 1.1097 and 1.1045, which corresponds to 161.8% and 200.0% Fibonacci. The execution of this scenario is hampered by the caution of the markets when selling euros. The second unsuccessful attempt to break through the level of 50.0% indicates the readiness of the tool to build a downward wave. But the MACD indicator cannot yet confirm this readiness.

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Trading plan for EUR/USD and GBP/USD pairs as of May 14, 2019

Although the macroeconomic calendar was completely empty, market participants were not bored. As soon as it became known that China was introducing retaliatory duties on goods from the United States with a total of $60 billion, investors began to play against that same dollar. Fears were fueled by rumors that the Celestial Empire could stop purchases of US government debt, as well as, reduce energy purchases from the United States. However, these are just rumors and China is never the first to take drastic steps, so rather it's like a warning to the White House that they say, if Donald Trump raises the duties on the rest of Chinese imports, which is about $300 billion, then the response will be no less difficult. At the same time, the dollar began to grow almost instantly and it was able to strengthen well by the end of the day. Surprisingly, the growth of the dollar coincided with the speeches of representatives of the Federal Reserve System. In particular, attention was attracted to the words of the head of the Federal Reserve Bank of Boston, Eric Rosengren. After all, the Federal Reserve has long been talking about the risks to the economy, which bears the aggravation of trade disputes with China. Hence, it is obvious that in the event of an increase in confrontation, the regulator can go to mitigate monetary policy as said exactly by Mr. Rosengren. True, he added that he did not see the need for this since the long-term consequences are still unclear. In other words, while the disputes continue and the exchange of mutual increase in customs duties continues, the Federal Reserve System will not take any action. Nonetheless, the Federal Reserve is responsible for the second economy of the world and its influence on financial markets is difficult to imagine. It cannot afford to be guided by momentary fears. Hence, the Federal Reserve System will not change its current course while Washington and Beijing are exchanging jabs and pricks.

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To be honest, if you look at the macroeconomic calendar, neither the single European currency nor the pound today has any reason to grow. In the UK, there are data on the labor market. Although the unemployment rate should remain unchanged and the number of applications for unemployment benefits should be reduced from 28.3 thousand to 24.2 thousand, the situation with wages is disturbing. It is predicted that the average wage growth rate may slow down from 3.4% to 3.3%. Moreover, the average wage growth rate, taking into account bonuses, which means overtime work, should also slow down from 3.5% to 3.4%. It is obvious that investors should wait for a decline in consumer activity in the form of a slowdown in retail sales and a decrease in lending, which reduces the potential return on investment. Sometimes it can cast doubt on the very payback of these very investments. If you look at Europe, the picture is no better since industrial production data should show a deepening decline from -0.3% to -0.8%. True, yesterday they predicted an acceleration of the decline rates to -2.1%. But it does not get any easier.

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The euro/dollar currency pair gradually draws a downward movement but still within the limits of an earlier stagnation. It is likely to assume that in case of price fixing lower than 1.1220, it is possible to consider a move to 1.1200 - 1.1180 as the first points.

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The pound/dollar currency pair showed a sharper downward movement, overcoming the psychological level of 1.3000, which previously held the quote. It is likely to assume that the downward interest will continue headed to the values of 1.2920 - 1.2880.

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Trading recommendations for the EURUSD currency pair - placement of trading orders (May 14)

For the last trading day, the euro / dollar currency pair showed a relatively low volatility of 42 points, but still having an attempt to break the newly formed cluster. From the point of view of technical analysis, we had a move towards a local maximum on May 1, 1.1264, where the quotation felt a periodic resistance. As a result, it slowed down the movement and formed a cluster in the region of 1.1235, tracing the V-shaped oscillation for a while. The news and news background did not have any statistics in itself, but there was a speech by the head of the Federal Reserve Bank of Boston, Erik Rosengren, to which the market responded. In the words of the head of the FBI, they revealed a rather clear position in which there was a message that they would not reduce the interest rate until there was more complete information about the economic situation in connection with the application of import duties.

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Today, in terms of the economic calendar, we have statistics on the European Union, where everything is not as good as we would like. Industrial production in March (g / g) continues to decline to -0.8%, which puts pressure on the single currency.

Further development

Analyzing the current trading chart, we see that the amplitude fluctuation within the value of 1.1235 persists, where traders occupy a waiting position and stretch from orders. The primary trading idea is in the form of a decline in the euro, where traders aim at the values of 1.1180 due to the return of quotes. The estimated start is below 1.1220 (clear fixation). Insurance in case of stagnation looks like an advance stretching order above the local maximum on May 1, 1.1264, where the perspective move is located at 1.13000.

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Indicator Analysis

Analyzing a different sector of timeframes (TF ), we see that the short-term perspective has changed the upward interest to the descending one, but it should be understood that the price stagnates and the indicators are volatile. Intraday and mid-term prospects still maintain an upward interest.

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Weekly volatility / Measurement of volatility: Month; Quarter; Year

Measurement of volatility reflects the average daily fluctuation, based on monthly / quarterly / year.

(May 14 was based on the time of publication of the article)

The current time volatility is 23 points. In case of breakdown of stagnation, volatility may increase, reaching the average daily rate.

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Key levels

Zones of resistance: 1.1300 **; 1.1440; 1.1550; 1.1650 *; 1.1720 **; 1.1850 **; 1.2100

Support areas: 1.1180; 1.1080 *; 1.1000 ***; 1,0850 **

* Periodic level

** Range Level

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Trading recommendations for the GBPUSD currency pair - placement of trading orders (May 14)

Over the last trading day, the pound / dollar currency pair showed high volatility of 99 points, as a result of having a breakdown of stagnation and a pulse candle. From the point of view of technical analysis, we see that the holding level of 1.3000 fell and a pullback followed by stagnation served as a certain regrouping of the trading forces, where as a result we saw a pulse move up to the level of 1.2940. The news and news background did not have any statistics in itself, but the speech was delivered by the head of the Federal Reserve Bank of Boston, Erik Rosengren, to which the market responded. From the words of the head of the FBI, they revealed a rather clear position in which there was a message that they would not reduce the interest rate until there was more complete information about the economic situation in connection with the application of import duties. Returning to Brexit, we have renewed negotiations between the British Conservatives and Labor. However, no progress has been observed. Keir Starmer, the spokesman for the Labor party opposition was held responsible for the Brexit's question and said that his party was ready to support the Brexit deal only if it was then put to a referendum. In turn, Theresa May rejected the possibility of a new Brexit referendum.

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Today, in terms of the economic calendar , we have statistics for the UK, where at first glance, everything is not that bad while the number of applications for unemployment benefits for April is reduced from 28.3K to 24.2K. At the same time, the average wage with premiums and excluding premiums is reduced, which will put pressure on the English currency.

11:30 MSK - The average wage excluding bonuses (Mar): Prev. 3.4% ---> Prog. 3.3%

11:30 MSK - The average wage with bonuses (Mar): Prev. 3.5% ---> Prog. 3.4%

Further development

Analyzing the current trading chart, we see that after the impulse move a slight pullback took place, the bearish interest remains on the market. It is likely to assume that the downward movement will continue in the direction of 1.2880 --- 1.2880, where afterwards you can wait for the corrective move.

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Indicator Analysis

Analyzing a different sector of timeframes (TF ), we see that in the short, intraday and medium term, there is a downward interest against the general background of the market.

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Weekly volatility / Measurement of volatility: Month; Quarter; Year

Measurement of volatility reflects the average daily fluctuation, based on monthly / quarterly / year.

(May 14 was based on the time of publication of the article)

The current time volatility is 27 points. If the downward trend continues. The volatility can safely reach the daily average.

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Key levels

Zones of resistance: 1.3000 **; 1.3180 *; 1,3300 **; 1.3440; 1.3580 *; 1.3700

Support areas: 1.2920 * 1.2770 (1.2720 / 1.2770) **; 1.2620; 1,2500 *; 1.2350 **.

* Periodic level

** Range Level

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Fundamental Analysis of USD/JPY for May 14, 2019

USD/JPY has been trading with the overall downtrend in a non-volatile and impulsive manner. The pair is trading firmly below 109.70 with a daily close. JPY managed to sustain the momentum over USD on the back of the unsettlee trade conflict between the US and China and disappointing economic reports from the US.

The US is due to present Retail Sales report on Wednesday which is expected to drop sharply to 0.2% from the previous value of 1.6%. Amid such bearish expectations, USD is struggling to gain momentum over JPY. The US economy has confirmed waning momentum by a series of downbeat economic reports. Besides, the US economy will deficitely suffer from the tensions. Investors are scared by the dismal prospect that the United States and China are spiraling into a fiercer, more protracted dispute that could derail the global economy. So, investors' fears triggered a sharp selloff on equities markets last week. According to FED Official Kashkari, the worst-case scenario and ever-increasing tariffs for an extended period of time that could make a real effect on US GDP growth that change things.

Additionally, a drop in the consumer outlook for inflation and intensifying trade tensions drew caution from Federal Reserve officials on Monday as policymakers faced fresh market volatility and a renewed set of risks. Major US equity markets were down between 2% and 3.5% on Monday, while bond investors sharply increased their bets that the Fed would be forced to cut rates this year. A closely watched spread between long- and short-term bonds turned negative, seen by some officials as a sign of feeble market confidence in the economic outlook.

Today US NFIB Small Business Index report is going to be published which is expected to increase to 102.3 from the previous figure of 101.8 and Import Prices is expected to edge up to 0.7% from the previous value of 0.6%. Moreover, FOMC Members George and Williams are going to speak today that will hardly make a neutral impact on upcoming USD gains.

On the JPY side, recently BOJ Governor Kuroda stated that additional easing is coming up if the consumer prices lose momentum. Kuroda also assured markets that short-term and long-term interest rates are expected to be kept unchanged at record low till Spring 2020. Today Bank Lending report was published with an increase to 2.4% which was expected to be unchanged at 2.3% and Current Account decreased significantly to 1.27T from the previous figure of 1.90T which was expected to be at 1.71T. The Japanese Economy Watchers Sentiment grew to 45.3 from the previous figure of 44.8 which failed to meet the expectation of 45.9.

To sum up, JPY is holding the upper hand in the pair. It is expected to struggle along the way against USD for a certain period. Upcoming macroeconomic reports from the US are going to reveal negative readings. In this context, USD gains are going to be short-lived and JPY momentum may strengthen again in the process.

Now let us look at the technical view. The price is currently trading at near 109.70 resistance area. The price is expected to climb a bit higher towards 110.50 before any bearish momentum emerges to continue the bearish trend in the coming days. As the price remains below 110.50 area with a daily close, the bearish bias is expected to continue.

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China's response measures increase the likelihood of further reductions in AUD and NZD

After a short pause, China has taken a number of retaliatory measures to increase import tariffs from the United States. Starting June 1, duties on goods amounting to 60 billion will be raised and despite the fact that US exports to China are significantly inferior in terms of imports, measures taken by China are more than serious for the American economy.

The urgent negotiations, which took place on Friday after the preventive actions of the United States, ended in vain. Panic is growing in the markets, which is about to turn into a full collapse. The S&P 500 fell by 2.41% to 2812p, as well as the Nasdaq lost 3.4%, and the US and Japan stock indexes went deep into the red zone. Only the Chinese Shanghai Composite at the auction on Tuesday shows a slight increase since the main negative factors for China were recouped a little earlier.

China's response may force the Fed to begin monetary policy easing this year as Boston's head of the Federal Reserve Bank Rosengren immediately informed in an interview with Reuters. If the parties fail to make a mutually acceptable decision in the very near future, then the whole effect of Trump's tax reform will be leveled and the growth rate of the budget deficit will increase. In the Chinese media, a discussion is unfolding on the theme of the mechanism for dumping American treasures and if events follow a negative scenario, the United States will face the likelihood of a sovereign default.

As a result, there is a danger of a further fall in risky assets and an increase in demand for defensive assets. Gold futures in June climbed to $1,300 while the yen updated a three-month high. The lack of positive news will not stop the negative trend. The currencies of commodity countries will remain under pressure despite the relatively stable oil prices.

NZD / USD pair

The New Zealand dollar continues to sell off, having no current serious reasons for the resumption of growth. The RBNZ reduced the rate by 0.25% last week, citing a slowdown in global and domestic growth, which significantly lowers its GDP short-term outlook. RBNZ's plans to lower the rate once again this year are still unclear. In any case, the regulator itself left behind a 50% chance of another step, which suggests the cyclical processes in the economy will make it possible to count on GDP growth after 2 quarters.

At the same time, market expectations are more negative. In particular, ANZ Bank predicts another rate reduction in November and another one in the first quarter of next year.

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No matter how the events develop in the trade war between China and the United States, New Zealand will inevitably be affected in the event of an escalation. Even a one-time reduction in the Fed rate in the fall will not change the dynamics of the spreads between US treasures and New Zealand government bonds, narrowing the spread will reduce the need for kiwi, which will sell off more intensively than the possible weakening of the dollar.

On Tuesday morning, Kiwi adjusted to the resistance of 109.70 and sales are likely to resume near this level. The immediate goal is 108.49, which can already be achieved this week.

AUD / USD pair

The fundamentals of Australia continue to deteriorate. Moreover, the demand for housing is declining, which is reflected in a decline in investment in construction and mortgage lending (-3.7% and -2.5% in March). The confidence indices in the business environment from NAB Bank declined again in April and the decline has become chronic.

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NAB notes a sharp drop in the employment index. The volume of new orders also decreased and the use of production capacity was reduced. In regards to the price pressure, it has weakened, which threatens both inflation and consumer demand in general.

Despite the fact that the RBA left the rate at 1.5% during the last meeting, forecasts imply two cuts in the current year, since inflation remains at an extremely low level of 1.3%. Under emerging conditions, an Aussie has no chance of resuming growth while bearish pressure remains strong despite being oversold. The immediate goal is 0.6880/90 and any growth will be used with high probability for large sales.

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Fundamental analysis of GBP/USD for May 14, 2019

USD has gained momentum against GBP recently which lead the price to break below 1.30 area with a daily close. It is a sign of further bearish momentum for the coming days. The British pound fell a bit initially to kick off the trading session on Monday as China announced further tariffs against the US.

The GBP/USD pair continues to trade in a 30-pips narrow range heading into early European session. Looking ahead, the UK jobs data may have limited impact on the spot, as the overall market sentiment will remain affected by Brexit and trade risk situation. Today, the UK Average Earnings Index report is going to be published which is expected to decrease to 3.4% from the previous value of 3.5%. Besides, the unemployment rate is expected to be unchanged at 3.9%. Furthermore, the claimant count change data is expected to be favorable with a decrease to 24.2k from the previous figure of 28.3k.

On the other hand, the downbeat economic reports from the US and the ongoing trade war with China may lead to further weakness in USD. Investors fear that the United States and China may be spiraling into a fiercer, more protracted dispute that could derail the global economy. It led to a sharp selloff in the equities markets in the past week. Minneapolis Fed President Neel Kashkari said: "If it's the worst-case scenario and it's ever-increasing tariffs for an extended period of time, that could change things, that could have a real effect on U.S. GDP growth." A closely watched spread between long- and short-term bonds turned negative, seen by some officials as a sign of weakened market confidence in the economic outlook.

Today, the US NFIB Small Business Index report is going to be published which is expected to increase to 102.3 from the previous figure of 101.8 and the import prices is likely to show an increase to 0.7% from the previous value of 0.6%. Moreover, FOMC Members George and Williams are going to speak today but these event will have a minor impact on the US dollar exchange rate. This week's high impact economic news is going to be the US retail sales report which is to be published on Wednesday. Experts predict that the retail sales decreased to 0.2% from the previous value of 1.6%.

As of the current scenario, the UK high impact economic reports may lead to certain gains on the GBP side if the outcome surpasses expectations, whereas the weaker USD may lead to further correction and volatility in the pair. The long-term bias is still favoring USD but certain gains on the GBP side are expected before the trendy bearish momentum strikes again.

Now let us look at the technical view. The price has formed the Bullish Divergence pattern while pushing below 1.30 area. The price may rise higher towards 1.30 again before any bearish signs show up to push the price lower in the coming days. As the pair remains below 1.30 area with a daily close, further bearish momentum is expected to gain pressure with the target towards 1.2850 support area.

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Indicator analysis. Daily review for May 14, 2019 for the pair GBP / USD

Trend analysis (Fig. 1).

On Tuesday, technical analysis demonstrates an upward movement. The first upper target of 1.2997 is the pullback level of 24.6% (yellow dotted line).

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Fig. 1 (daily schedule).

Comprehensive analysis:

- indicator analysis - up;

- Fibonacci levels - up;

- volumes - up;

- candlestick analysis - up;

- trend analysis - up;

- Bollinger lines - down;

- weekly schedule - down.

General conclusion:

On Tuesday, technical analysis demonstrates an upward movement. The first upper target of 1.2997 is the pullback level of 24.6% (yellow dotted line).

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Indicator analysis. Daily review for May 14, 2019 for the EUR / USD pair

Trend analysis (Fig. 1).

Today, the upward movement with the target of 1.1264 is the upper fractal. In case of a breakthrough, a further upward movement with the target of 1.1275 is a pullback level of 76.4% (yellow dashed line).

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Fig. 1 (daily schedule).

Comprehensive analysis:

- indicator analysis - up;

- Fibonacci levels - up;

- volumes - up;

- candlestick analysis is neutral;

- trend analysis - up;

- Bollinger lines - up;

- weekly schedule - up.

General conclusion:

Today, the upward movement with the target of 1.1264 is the upper fractal. In case of a breakthrough, a further upward movement with the target of 1.1275 is a pullback level of 76.4% (yellow dashed line).

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Burning forecast EURUSD 05/14/2019

No important news in the calendar. From the unplanned: New mutual shots in the US-China trade war. Recall: last Friday, Trump raised duties on $ 200 billion-worth of goods from China from 10% to 25%. Yesterday, on Monday, May 13, China responded by announcing that from June 1, it would raise duties on $60 billion-worth of goods from the US. In response to this, the US Department of Commerce announced that it has prepared a new list of goods worth $300 billion from China and it would to raise duties from 10% to 25%. Trump said that he demanded China to not respond to US measures - and said that he would meet with Xi Jing Ping in June at a meeting of the big 20 to address trade issues.

EURUSD: The rate is still being held within the beginning of the upward movement - but everything will be decided in the next day or two. The key level of 1.1270 - if the euro passes it and consolidates above - an upward trend is very likely.

On the contrary, the euro's fall to 1.1280 and below - a return to the range and the possibility of going down.

We are ready to buy from 1.1270

We are ready to sell from 1.1130

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Control zones for USD / CHF pair on 05/14/19

The Downward movement remains a priority. It is important to note that the implementation of the recurrent model occurred, which was aimed at the level of 1.0110. The next target of the downward movement will be the weekly control zone of 1.0024-1.0004. Achieving this goal will allow you to record sales by 100% since it coincides with the range of the average course of the week.

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For those who want to open sales, you will need to wait for a corrective growth. In this case, it will be possible to sell for the purpose of testing the above zone.

An alternative model will be implemented if yesterday's fall is completely absorbed by today's growth. The probability of the formation of this model is 30%, which makes it auxiliary. The search for favorable prices for the purchase must be made within a weekly control zone 1.0024-1.0004.

Daily CZ - daily control zone. The area formed by important data from the futures market that change several times a year.

Weekly CZ - weekly control zone. The area formed by marks from important futures market which change several times a year.

Monthly CZ - monthly control zone. The area is a reflection of the average volatility over the past year.

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BITCOIN reached the milestone $8,000. May 14, 2019

BITCOIN bounced off $7,500 amid the impulsive bullish momentum as expected. So, BTC reached the next milestone price area of $8,000 in the overnight trade in no time. The price is trading in the impulsive and non-volatile manner. Amid the persistent bullish pressure, BTC is expected extend its wings further with a target towards $10,000 area in the coming days.

Bitcoin has hit the highest level since mid-2018, posting a 14% gain as of the time of writing this article. It isn't clear when the buying activity is going to stop, but this is quite a sight to behold. As the leading cryptocurrency has boomed, pushing past key resistance levels, they are nothing more than soggy pieces of parchment, other crypto assets have done relatively poorly. With this move, BTC has surged past a number of key resistances, namely $7,400 and $8,000, and cements the bullish sentiment in the mind of traders worldwide.

What makes this move even more promising is that according to Google Trends, the search terms for "Bitcoin" and "buy Bitcoin" have to surge higher, indicating that much of the rally is being caused by those already involved in the crypto trade. Moreover, Grayscale's Bitcoin Trust (GBTC) saw $150 million in trading volume on Monday, which is a sign that institutional investors and accredited investors are throwing their hats into the ring rapidly.

On the USD side, the US is due to present retail sales data on Wednesday. Analysts have downbeat expectations about it. US retail sales are expected to slump to 0.2% from the previous value of 1.6%. Moreover, recently published negative economic reports and the unsettled trade conflict between the US and China could undermine BTC momentum.

To sum up, Bitcoin is assumed to retreat towards the dynamic level of 20 EMA along the way again before the price breaks above $8,000 price area with a confirmed daily close to indicate further upward pressure. The upward target could be projected towards the next milestone price area of $10,000 in the coming days. As the market is building momentum like this, Bitcoin is expected to sustain the impulsive bullish momentum along the way further.

SUPPORT: 7,000, 7500, 7,750

RESISTANCE: 8,000, 8,250, 8,500

BIAS: BULLISH

MOMENTUM: NON-VOLATILE

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Trading plan for EUR/USD for May 14, 2019

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Technical outlook:

The EUR/USD tested 1.1260 yesterday, the previous swing highs, before pulling back lower to 1.1220. The pair is seen to be trading around 1.1240 levels for now, looking to drop towards 1.1200 level going forward. Besides, be prepared for yet another climb above 1.1260, which could push EUR/USD higher towards 1.1280/1.1320 levels, before reversing lower again. Trading opportunities seem to be on both sides for now, with aggressive traders on the long side and conservative traders waiting to go short. Immediate support is seen at 1.1170 levels while interim resistance is seen just above 1.1260 levels. A break below 1.1170 levels from here, would confirm that a meaningful top could be in place; while a push above 1.1260 levels would indicate further potential remains towards 1.1280/1.1320 levels. Please note the fibonacci convergence also seen at 1.1320 levels, making it a great opportunity to go short again.

Trading plan:

Aggressive traders remain long with stop at 1.1170 and target 1.1280/1.1350 levels while conservative traders remain flat and look to sell at higher levels.

Good luck!

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Elliott wave analysis of GBP/JPY for May 14, 2019

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We have now seen the expected dip close to our 141.05 target (the low has been seen at 141.17). We could still see a second attempt to reach the ideal target at 141.05, but it's not necessary. To indicate a low being in place, we need a break above minor resistance at 142.56, while a break above resistance at 143.44 will confirm that wave 2 has completed and wave 3 is developing for a rally towards 151.50.

R3: 143.44

R2: 142.85

R1: 142.56

Pivot: 142.22

S1: 141.81

S2: 141.46

S3: 141.17

Trading recommendation:

Our stop+reverse at 141.25 was hit for a nice profit of 245 pips and a nice long entry at 141.25. We will place our stop at 140.25.

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The pound is awaiting the meeting of the "Backbench Business Committee"

Yesterday, the pound ignored the news that Labour had resumed negotiations with the representatives of Theresa May's government. As a result of the April talks, it became clear that the parties are still on opposite sides of the barricades and are not ready to make reciprocal concessions of a substantial nature. In addition, internal political conflicts (both in the camp of the Labour Party and in the camp of the Conservatives) complicate the already difficult dialogue between the opposing parties. Therefore, the positive statements of May's representatives on the resumption of negotiations were received coolly by traders. Today's data on the labor market in Britain, most likely, will also be ignored, given the upcoming events.

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The fact is that tomorrow, May 15, the political fate of British Prime Minister Theresa May will be decided again. Despite the fact that she has annual immunity from impeachment, a certain intrigue still remains, and hardly any expert can now say with complete confidence about the final result of tomorrow's meeting of the 1922 Committee. However, first things first.

So, tomorrow, the 1922 Committee will have their meeting in London - that is, a group of British conservative deputies who are authorized to express a vote of no confidence in the current prime minister. They are also called "backbenchers", since they do not occupy a single post in the structure of the government, therefore, they can impartially evaluate the actions of its head. Looking ahead, I'll say that in this case they cannot initiate the question of Theresa May's resignation. Last year, the British prime minister had twice successfully passed through the procedure of a vote on a vote of no confidence. For the first time, conservative members of the same party discussed the issue of trusting their leader; for the second time, the entire House of Commons voted for this question. Despite the squall of criticism against May, the MPs still left her in the chair of the head of the cabinet: moreover, after the last vote, she received annual immunity from such initiatives.

After the autumn events, the prime minister was able to follow set course, and many (then) were convinced that the freedom of maneuvers that had appeared would allow her to lead the country out of the political impasse. But in reality the opposite occurred: the snowball of political contradictions only increases, bringing down the ratings of both the Conservatives and the Laborites. Local elections, which were held the week before last, only confirmed this fact. The Conservative Party lost more than 1.3 thousand seats (out of 8.4 thousand) and lost control over 49 local councils (out of 248), the laborites, in turn, lost 6 local councils and 86 deputies. Politicians reasonably associate such a disastrous result with Brexit, namely with the long-term period of uncertainty, which forces the British to live in limbo, in anticipation of an "economic apocalypse."

For this reason, Parliament's support for Theresa May fell to 30%, while the remaining 70% of the deputies strongly oppose her continued tenure. Naturally, in the conditions of such a frank political hostility, it is rather difficult, if not impossible, to conduct any negotiations on the coordination of a deal. But at the same time the prime minister can play her last trump card by putting her post on the line.

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Previously, she has repeatedly stated that she could leave her post when Parliament approves her deal with the EU. But deputies need to specify these intentions and establish a fixed date of resignation. In other words, we are talking about a kind of deal: May agrees to voluntarily leave the prime minister post (while naming a specific date of resignation), but at the same time she makes a draft deal in Parliament, counting on their approval.

Here it is worth noting that earlier, they rejected a similar scenario in Downing Street: surrounded by May's entourage, they assured that the prime minister would remain at her post until at least autumn, when the general congress of the members of the Conservative Party would be held. But the failed negotiations with the Labour Party, as well as the increasingly popular idea of holding a repeat referendum, changed the mood of the "Iron Lady". At least, according to information sources of British journalists.

Thus, this week, Brexit's theme may once again play with fresh colors: if May really announces the date of her departure, the negotiations on the approval of the deal will acquire a new meaning. We can not say that in this case the transaction will be approved "automatically", but the likelihood of such an outcome will increase in many ways. At the very least, the initial reaction of the pound (and the GBP/USD pair) will be positive. In tandem with the dollar, the British currency can not only return to the area of the 30th figure, but also reach the main resistance level of 1.3130 (the upper limit of the Kumo cloud, coinciding with the upper line of the Bollinger Bands indicator on the daily chart).

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