Bitcoin analysis for May 16, 2019

BTC has been trading sideways at the price of $7.895. Our bearish scenario is still valid and we expect more downside.

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According to the H4 time-frame, we found that bullish momentum continues with decreasing, which is sign that buying looks risky. BTC is in extended run phase and potential pullback is expected. We found the bearish divergence on the slow Stochastic oscillator, which is another sign of the potential pullback incoming. The ADX is going down indicating potential weakness on BTC. Additionally, there is the fake breakout of the high $8.153. Watch for selling opportunities.

Upward references:

Swing high – $8.153

Downward:

Swing low – $7.590

Previous high became support - $7.413

Swing low - $6.834

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USD/JPY analysis for May 16, 2019

USD/JPY has been trading upside. The price tested the level of 109.94 The breakout of 3-balance is present. Watch for buying opportunities.

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According to the Daily time-frame, we found that there is the breakout of the 3-day balance, which is sign that buyers too control from sellers. We also found bullish divergence on the Stochastic oscillator and rejection of the lower Keltner band at 109.07. Watch for buying opportunities with targets at 110.55 and 11.92.

Downwards references are set:

Balance high – 109.83

Daily low – 109.30

Upward references are set:

20 EMA – 110.56

Swing low acting like resistance – 110.92

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EUR./USD analysis for May 16, 2019

Gold has been trading downwards in pat 8 hours. The price tested the level of 1.1172. We are still expecting more downside.

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According to the H4 time-frame, we found that there is the breakout of the upward trendline (support) in the background, which is sign that there is change in trend dynamic from bullish to bearish. Additionally, we found successful re-test of the broken support at 1.1220, which is another sign of the weakness. Watch for selling opportunities on the rallies with the potential target at 1.1134.

Upward references are set:

Previous swing low became resistance – 1.1197

Daily swing high – 1.1224

Downward references are set:

Swing low – 1.1134

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EUR and CAD: The euro continues to decline amid negative news, while the Canadian dollar strengthened its position

The euro continues to remain under pressure after an unsuccessful morning attempt to get out of the large resistance level of 1.1215. The eurozone balance sheet report put pressure on the pair in the first half of the day, as its decline was recorded.

However, economists can breathe a little, as yesterday the administration of President Donald Trump postponed the decision to impose import duties on cars from Europe.

According to the data, the trade surplus fell to 17.9 billion euros in March of this year from 20.6 billion euros in February. The reduction was due to the fact that imports grew faster than exports. Excluding the correction, the eurozone's foreign trade surplus in March was 22.5 billion euros and against 26.9 billion euros in March 2018.

As for trade with the United States, the balance fell to 33.9 billion euros from 36.2 billion euros a year earlier. Exports from the EU to the United States in the 1st quarter, though growing, imports were even more. The report indicates that compared to the same period in 2018, US exports grew by 8.2%, while EU imports from the US grew by 16.3%.

As for the technical picture of the EURUSD pair, it remained unchanged compared with the morning forecast. After an unsuccessful attempt to grow the euro above the resistance of 1.1215, pressure on the trading instrument resumed. The bears almost pushed EURUSD to the support of 1.1180, the breakthrough of which would lead to a larger sale in the area of 1.1150 and 1.1100.

The USDCAD pair fell today after the release of a good report on sales in the manufacturing sector of Canada, which showed quite strong growth. This once again confirms the regulator's expectations that the Canadian economy has overcome a period of temporary weakness.

According to the Bureau of Statistics of Canada, sales in the manufacturing sector in March 2019 increased by 2.1% compared with the previous month and amounted to 57.97 billion Canadian dollars. Economists had expected growth of only 1.7%.

The Australian dollar continues to be under pressure after the morning report, in which it was shown that the unemployment rate in Australia rose in April, despite the increase in the number of jobs.

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According to the Australian Bureau of Statistics, unemployment in Australia rose to 5.2%. In March, unemployment was 5.1%, against a previous estimate of 5.0%. The number of jobs increased by 28,400, while economists expected growth of 15,000. The share of the economically active population rose to 65.8% versus 65.7% in March.

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GBP/USD: plan for the US session on May 16. The pound continues to move down, forming more bullish divergences

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

The pound continued to decline in the first half of the day, however, bullish divergences on the MACD indicator continue to form, which may lead to the end of the intraday downward trend at any time. The task of the bulls in the afternoon will be to return to the resistance level of 1.2812, which will lead to the closure of a number of short positions and a larger upward correction in the maximum area of 1.2877, where I recommend fixing the profits. In the scenario of further decline of GBP/USD on the trend, it is best to look at long positions on the rebound from the minimum of 1.2769.

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

Bears have coped with the task of securing below the level of 1.2812, and while trading is conducted under this range, the pressure on the pound will remain. The main goal of sellers for the second half of the day is a minimum of 1.2769, where I recommend fixing the profit. In the scenario of a return to the resistance of 1.2812, it is best to consider new short positions for a rebound from the maximum of 1.2877.

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 the pound growth in the second half of the day, the upper limit of the indicator in the area of 1.2865 will limit the upward movement.

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Description of indicators

  • MA (moving average) 50 days - yellow
  • MA (moving average) 30 days - green
  • MACD: fast EMA 12, slow EMA 26, SMA 9
  • Bollinger Bands 20
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EUR/USD: plan for the US session on May 16. The demand for US dollar returns

To open long positions on EURUSD, you need:

Another weak data on the eurozone economy led to a decline in the euro in the first half of the day. At the moment, only the formation of a false breakdown in the support area of 1.1183 will be a signal to open long positions in EUR/USD. Otherwise, buying the euro immediately to the rebound is best from a minimum of 1.1155. The main task of the bulls in the afternoon will be the return and consolidation above the resistance of 1.1215, which will open a direct road to the area of a weekly high of 1.1242, where I recommend fixing the profits.

To open short positions on EURUSD, you need:

Sellers managed to form a false breakdown in the resistance area of 1.1215, which led to a new wave of short positions in European currency. At the moment, the task of the bears is to breakdown and consolidate below the support of 1.1183, but the main goal remains at least 1.1155, where I recommend fixing the profits. In the case of the euro growth scenario in the second half of the day, it is best to open short positions to rebound from a maximum of 1.1242.

Indicator signals:

Moving Averages

Trading is below 30 and 50 moving averages, which indicates the preservation of the downward correction.

Bollinger Bands

In the case of euro growth in the second half of the day, it will limit the upward movement of the upper border of the indicator in the area of 1.1220.

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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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EURUSD: The administration of the US president postponed the duty on cars. The growth of the US economy may slow down in

The euro jumped sharply yesterday on the news that the administration of US President Donald Trump postponed the final decision to impose import duties on cars and spare parts. The downward movement in the EURUSD pair, which was formed after weak data on the eurozone economy, was interrupted after the appearance of information about the postponement of the introduction of duties for about 6 months.

Let me remind you that the White House has repeatedly stated about the possible introduction of duties on cars that are produced by US trading partners. It is not only about China, but also about the eurozone and Japan. Representatives of the automotive industry in the United States also spoke about the postponement of the introduction of duties.

Weak data on the US economy also prevented the US dollar from continuing its upward trend against a number of world currencies.

According to a report by the US Department of Commerce, retail sales in April of this year fell by 0.2% compared with the previous month, while economists had expected retail sales to increase by 0.2%.

A weak retail sales report is a bad signal and will have a negative impact on the growth rate of the US economy in the 2nd quarter of this year.

Industrial production also weakened in April, which is another indication of a slowdown in economic growth due to trade conflicts that put special pressure on the manufacturing sector.

According to the report of the US Federal Reserve, industrial production in April fell by 0.5%, while economists had expected that it would remain unchanged.

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The main pressure on the overall figure was the drop in the manufacturing production, which in the US fell by 0.5% in April this year compared to the previous month.

The data on the manufacturing index of the New York Fed was ignored by the market.

The report indicates that manufacturers in the area of responsibility of the Federal Reserve Bank of New York in May reported an increase in activity. The index in May rose to 17.8 points, while economists had expected the index in May to be 8 points.

The data on inventories of companies in the United States also did not impress traders. According to a report by the US Department of Commerce, inventories in March remained unchanged at $2.018 trillion. Economists also expected stocks to remain unchanged.

The report of the National Association of Home Builders (NAHB) showed that the housing market index in May of this year increased by 3 points compared with the previous month and amounted to 66 points. Economists had forecast an index of 64.

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Simplified wave analysis and forecast for GBP/USD and USD/JPY on May 16

GBP/USD

On the chart of the pound from May 3, the downward wave algorithm continues to develop. This price segment completes the larger wave model from March 13, which explains the pronounced impulsive nature of the movement. The price is at the lower border of the large-scale support zone.

Forecast:

The preliminary calculation of the target of the entire bearish wave indicates the reference point of the 127th price figure. After yesterday's breakthrough down at the next sessions, a counter rollback is expected, most likely in the form of a flat. The upper boundary of the flat corridor indicates the resistance zone. The breakthrough of the lower border of the support zone is more likely tomorrow.

Recommendations:

Given the nature of the price movement of the pound, you should not buy a pair today. The most reasonable tactic will be to wait out the period of the rollback, tracking the reversal signals at its end to find the point of sale of the pair.

Resistance zones:

- 1.2890 / 1.2920

Support zones:

- 1.2830 / 1.2800

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USD/JPY

On the chart of the Japanese yen, the downward wave dominating from mid-April forms a correction for a larger wave structure. The potential for reduction is almost exhausted. The wave structure is fully formed, the price is within the support zone of the senior TF. Since May 13, a potential reversal pattern has been developed on the TF H1 chart.

Forecast:

The nature of the upcoming fluctuations is likely to be flat, in a flat corridor between oncoming zones. At the next trading sessions, the price reduction that started 2 days ago is expected to end. The change, of course, can be expected by the end of the day or tomorrow.

Recommendations:

Yen sales during the trading session are possible today, but it is better to reduce the lot to the minimum. In the area of calculated support, it is recommended to track reversal signals to search for entry into long positions for this pair.

Resistance zones:

- 109.80 / 110.10

Support zones:

- 109.10 / 108.80

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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.

Attention: Wave algorithm does not take into account the duration of tool movements over time.

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Bitcoin. The number of bitcoin-related search queries continues to grow

The Bitcoin rate continues to "lick" the level of 8000 USD. In the meantime, the number of Bitcoin-related search queries continues to grow. This is indicated by the report of the analytical service Google Trends. Recently, after a sharp rise in the rate of Bitcoin, the number of search queries related to Bitcoin has increased significantly, making it more attractive for investment.

Signal to buy Bitcoin (BTC):

Bitcoin continues to trade in the area of 8000 USD, retaining its upward potential. The next target for buyers will be the breakdown of the maximum of 8160, which was not possible yesterday. Only after that, you can count on updating the levels of 8450 and 8700, where I recommend fixing the profits. With the downward correction scenario, the area will be supported by 7600, however, it is possible to buy Bitcoin immediately to rebound around 7200.

Signal to sell Bitcoin (BTC):

Only the repeated formation of a false breakdown at a maximum of 8160 will be the first signal for the sale of Bitcoin in order to reduce to the lower border of 7600 and update the larger support area of 7200, where I recommend fixing the profits. With further growth in the trend, it is best to consider selling a rebound from a maximum of 8500.

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Technical analysis of GBP/USD for May 16, 2019

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Overview:

In the long term, the GBP/USD pair continues to move downwards from the level of 1.2905. This week, the pair rose from the level of 1.2905 to a top around 1.2800 and it set around the spot of 1.2800. The first resistance level is seen at 1.2905 followed by 1.2963 , while daily support 1 is seen at 1.2798 (38.2% Fibonacci retracement). According to the previous events, the GBP/USD pair is still moving between the levels of 1.2700 and 1.2610; so we expect a range of 90 pips in coming hours. Furthermore, if the trend is able to break out through the first support level at 1.2662, we should see the pair climbing towards the double bottom (1.2436) to test it later. Therefore, sell below the level of 1.2800 with the first target at 1.2610 in order to test the daily resistance 1 and further to 1.2436. Also, it might be noted that the level of 1.2436 is a good place to take profit because it will form a double bottom. On the other hand, in case a reversal takes place and the GBP/USD pair breaks through the resistance level of 1.2905, then the stop loss should be placet at 1.2930.

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GBP/USD. May 16. Trading system "Regression Channels". The pound went into free fall

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 Thursday, May 16, the British pound continues its non-stop, though not very strong, fall. We believe that the pound does not pay any attention to any macroeconomic reports, as yesterday the US news should have caused at least a small pullback of the pair to the top, and a day earlier – the news from the UK was not so failed that the British currency fell all day. Thus, the main topics for the pound remain Brexit and Donald Trump's actions in the international arena. We have repeatedly said that on the topic of Brexit, it is difficult for the pound to find at least some support. Trump's escalation of the trade war with China and possibly the EU is also likely to play into the hands of the US currency. Thus, for the pound, there is no single factor that would cause demand for it. From time to time, there are corrections in favor of the pound but they are all based either on a clean technique or on the next portion of expectations for a favorable outcome of Brexit. There are no important macroeconomic publications planned for the UK today, as in the United States. Our forecast is the continuation of the pair decline. It will be possible to determine the beginning of the correction by turning the Heiken Ashi indicator up. We still recommend that you carefully monitor any messages from Trump.

Nearest support levels:

S1 – 1.2817

S2 – 1.2756

S3 – 1.2695

Nearest resistance levels:

R1 – 1.2878

R2 – 1.2939

R3 – 1.3000

Trading recommendations:

The pair GBP/USD continues its downward movement. Thus, short positions with targets at 1.2817 and 1.2756 are now relevant, before Heiken Ashi's indicator turns up, which will indicate a round of upward correction.

Buy-positions are recommended to be considered only after fixing the pair above the moving average with the first targets at 1.3000 and 1.3062. 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 line unidirectional movement.

The lower linear regression channel – purple line 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.

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EUR/USD. May 16. Trading system

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) – sideways.

CCI: -38.5563

Reports on retail sales and industrial production in the United States were much weaker than expected to see the markets. However, they did not harm the US dollar much. The pair remains below the moving average line and threatens to move to a sideways movement in recent days. The trade war between China and the US is not too worried about the EUR/USD pair traders. Market participants failed to overcome the level of 1.1260 with two attempts, and this point is the best shows the weakness of the bulls at this time. Meanwhile, it was reported that this week, Donald Trump will have to make a decision on trade disagreements with the European Union. As it is not difficult to guess, Trump believes that the EU "has treated America unfairly for a long time", so it is also necessary to introduce trade duties against them. First of all, the increase in duties on European imports may affect the automotive industry. It will be a very serious blow to the EU economy. We believe that any escalation of the conflict with the European Union will have a very negative impact on the positions of the euro. At the same time, we believe that the EU will not take a position as strong as China, and will sit down at the negotiating table with Washington much faster.

Nearest support levels:

S1 – 1.1169

S2 – 1.1108

Nearest resistance levels:

R1 – 1.1230

R2 – 1.1292

R3 – 1.1353

Trading recommendations:

The EUR/USD pair has overcome the moving average but is currently being adjusted. Thus, it is now recommended to wait for the completion of the current round of correction and open new short positions with the target of 1.1169.

It is recommended to consider trading for an increase in the pair with extreme caution and small lots not earlier than fixing the price above the moving average line and the level of 1.1230 with the first goal of 1.1292. The intermediate target is 1.1260.

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 – the blue lines of the unidirectional movement.

The lower linear regression channel – the 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

Technical analysis of EUR/USD for May 16, 2019

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Overview:

Pivot point: 1.1166.

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.

Major support levels: 1.1069 | 1.1111 | 1.1148

Major resistance levels: 1.11216 | 1.1142 | 1.1266

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The forecast for EUR/USD and GBP/USD on May 16. The fall of the pound – unconditionally, the euro can roll back up

EUR/USD – 4H.

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As seen on the 4-hour chart, the EUR/USD pair performed a fall to the retracement level of 100.0% (1.1177) and rebounded with a reversal in favor of the European currency after failing to close under this level. Yesterday's news from the US contributed to the rebound of quotations from the Fibo level of 100.0%. Retail sales in April fell by 0.2%, and industrial production by 0.5%. Naturally, such news prevented traders from continuing to sell the pair. Thus, now we can count on some growth in the direction of the retracement level of 76.4% (1.1241). From this Fibo level, a rebound is also expected, which will allow quotes to perform a reversal in favor of the US dollar and resume the fall in the direction of the retracement level of 100.0%. Traders can determine the downward reversal of the pair by turning the MACD down or by disconnecting from the Fibo level. I do not expect to see the pair much higher than 76.4% and much lower than 100.0% in the near future, as several rebounds from these levels show the weakness of traders' intentions outside this price range.

The Fibo grid was built on extremums from March 7, 2019, and March 20, 2019.

Forecast for EUR/USD and trading recommendations:

In the current conditions, the EUR/USD pair can easily move in the side corridor between the levels of 76.4% and 100.0%. Thus, traders can buy a pair with a target at 1.1241, near which we can expect a rebound. If this hypothesis is fulfilled, it is recommended to sell the pair with a target of 1.1177 and a stop loss order above the Fibo level of 76.4%. The news calendar does not contain important data today, but one should not forget about the "Trump factor", which at any time can come up with discouraging information.

GBP/USD – 4H.

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As seen on the 4-hour chart, the pair GBP/USD continues to fall and completed the consolidation below the retracement level of 50.0% (1.2867). Today, May 16, a bullish divergence is brewing at the CCI indicator, the formation of which will allow traders to expect a reversal in favor of the British currency and some growth in quotations. The consolidation of the pair above the level of Fibo 50.0% similar work in favor of the early growth of the pair in the direction of the retracement level of 61.8% (1.2969). Thus, we consider purchases with a rebound from the level of 38.2% (1.2765), or above the level of 50.0%.

GBP/USD – 1H.

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As seen on the hourly chart, the pair GBP/USD clarifies the technical situation well. The closure of the pair above the Fibo level of 100.0% (1.2865) will be the first call to the desire of the pound to start the growth with the target of 76.4% (1.2939). Under the retracement level of 100.0%, thus, we are considering new sales of the pair from the Fibo level of 127.2% (1.2782). Today, the emerging divergence is not observed in any indicator. No news is expected today, but there may be messages from Donald Trump or Theresa May, who have a habit of disturbing the Forex Market. The themes "China-US Trade War" and "Brexit" continue to be significant for Forex traders.

Forecast for GBP/USD and trading recommendations:

The pair GBP/USD below the Fibo level of 100.0% (1.2865) retains the chances of falling in the direction of the retracement level of 127.2% (1.2782). Therefore, it is recommended to sell the pair. The first signal to buy the pair is to close on the hourly chart above the level of 100.0%. The second – closing at 4-hour above the level of 50.0%. In terms of price, they almost coincide, but in time – different. Holding positions at 4-hour above this level will allow considering purchases with a target of 1.2939.

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The euro was inspired by the fact that Trump can spare Europe and the pound is still hostage to Brexit

On the eve, the EUR / USD pair managed to recover and overcome the 1.12 mark . The main driver of growth for the pair were the reports that US President Donald Trump plans to postpone the decision on customs duties on imports of cars from the EU to the United States for up to six months.

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According to CNBC sources, the head of the White House intends to postpone this decision in connection with the protracted trade conflict with the Middle Kingdom.

The official statement of the American leader on this issue is expected closer to Saturday.

"It seems that Donald Trump decided that it would be better, for now, to wage a trade war on one front and focus on China," said Shaun Osborne, chief currency strategist at Scotiabank.

According to Goldman Sachs experts, the trade disputes of Washington and Beijing can put pressure on the single European currency, which will suffer from any sign of a slowdown in economic growth in the Middle Kingdom. Moreover, according to experts, the European Central Bank is a step closer to easing the monetary rate - much closer than the US Federal Reserve.

According to the forecast of Goldman Sachs, the euro may fall in price against the dollar to $1.10 over the next 3 months.

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The British currency has become the main outsider. On the eve, the GBP/USD pair could not use the stabilization at the level of 1.2900 to return at least above the level of 1.2920. News that the British government could not find a common language with the opposition. Although it didn't become a big surprise, it turned out to be a sufficient reason to send the GBP/USD pair to the figure below.

Negotiations of the Labor Party and the Conservatives are likely to continue, but the behavior of investors suggests that they do not really believe in reaching a compromise.

Meanwhile, the pressure on Theresa May is growing as they are expected to have a date of resignation, but she made it clear that she would not leave her post until Parliament approves the "divorce" agreement with the European Union. Considering that no significant changes were made to the document and inter-party negotiations have yet come to nothing, it is highly likely that another vote on the deal in the House of Commons scheduled for the first week of June will fail.

It should be recognized that the overall performance of the British economy is consistently good, especially compared to the EU, but the continuing uncertainty on the Brexit does not allow the pound to recover.

It is possible that the next stop for the GBP/USD pair may be the 1.2773 mark.

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Control zones for Bitcoin on 05/06/19

Now, Bitcoin is in the process of forming a defining model. If there are willing to sell the instrument at such favorable prices, this will lead to the formation of a correctional model. The purpose of the correction will be to return first to the range of the average move of the week and then possibly, to the month. The first target is at $7,800 per bitcoin. Closing trades above this mark will indicate a 90% chance of returning to it next week. Now, you need to find a pattern that will allow you to open a corrective sale or block purchases for those who are already in a long position.

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It is important to understand that the current momentum is strong, therefore, it is necessary to follow simple rules for partially fixing sales and quickly moving positions to breakeven in order to work in the opposite direction.

An alternative model has a probability of less than 30% and continues to grow Bitcoin to the next psychological mark. Updating today's high and closing trades above will indicate continued growth. This will force them to get rid of sales opened by the "false breakdown" pattern of yesterday's extremum. A bargain shopping zone will start at $7,500, thus, the first sales fixation will also be required in the event of a depreciation.

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

Weekly CZ - weekly control zone. The area formed by marks from the important futures market, which changes 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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The Fed, reassuring everyone, does not know what to do: Expecting further decline in the AUD/USD and NZD/USD pairs

Fed officials continue to calm themselves and financial markets, despite the fact of trade standoff as the US economy feels pretty good

Such thoughts are presented by all heads of federal banks, without exception, including Fed Chairman Jerome Powell. Thus, head of the Federal Reserve Bank of Richmond, Tom Barkin, echoed his colleagues, discussing the state of the American economy and the prospects for interest rates on Wednesday. He noted that there is "a sense to maintain patience on the prospect of a change in rates given the current economic climate in the United States," that there is no reason for either raising or lowering them. At the same time, he reported that the economy is healthy and economic growth "remains healthy." In general, everything is good and just need to wait.

Indeed, the latest data shows the annualized GDP growth to be 3.2%, the inflation rate at a comfortable level of 2.0%, and the unemployment rate of 40-year low at 3.6%.

The numbers are really impressive and the statements of officials that the trade war with China will not cause significant damage to the country and probably reassure someone, but not the financial markets. Bidders are still cautious. They note that the main indicators of the state of the American economy are clearly showing signs of a slowdown and added yesterday's retail sales data for April, which not only fell in growth but drop by 0.2%. The core retail sales index fell to 0.1% from 1.3%, while it was expected to decline in growth to 0.7%.

In addition, the second quarter GDP estimate for the Atlanta Federal Reserve Bank, which shows a drop in GDP growth in the second quarter to 1.1% from 1.6% makes one think. An important point is also the dynamics of real private investment within the country, which decreased in the second quarter from 3.2% and -3.7% to 3.0% and -5.7%, respectively.

Given the lack of clear certainty in the future, the business will not be active in investing in its own business and a possible failure in negotiations with the Chinese will be a catalyst for negative processes in the American economy, contributing to its inhibition. While the Federal Reserve, investors and financial markets are actually frozen in anticipation of a denouement, which is still not coming. On this wave, there is high volatility in the stock and commodity markets but the foreign exchange market seems to be quite still for a long period of time to remain "boring" because of the pause, which the world central banks actually occupied and not only did they watched everything.

Forecast of the day:

The AUD/USD pair remains in a downtrend in the wake of uncertainty as a result of trade negotiations between the US and China. We expect the continuation of a smooth decline in prices to a local minimum of 0.6825 after overcoming the mark of 0.6900.

The NZD/USD pair is also trading lower amid the lack of positive news on the negotiations between the Americans and the Chinese. We expect the continuation of a smooth decline in prices to 0.6525 and then to 0.6500.

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AUDJPY: AUD to regain momentum over JPY for short-term? May 16, 2019

AUD is struggling to gain momentum over JPY recently which strengthened further after Australia's Unemployment report showed an unexpected increase while having better Employment Change.

RBA Assistant Governor Bullock spoke today about the upcoming payment system in Australia which will enhance transactions and customer experiences in the near future. Bullock did not quite involve the Employment results in the speech which lead to confusion among market participants. Today Australian Employment Change report was published with an increase to 28.4k from the previous figure of 27.7k which was expected to decrease significantly to 15.2k. The positive employment change was quite remarkable. However, Australia's jobless rate rose to 5.2% from the previous value of 5.1%, contrary to the forecast for a decrease to 5.0%.

On the other hand, Bank of Japan's Deputy Governor Wakatabe stated that benefits of central bank's ultra-loose monetary policy still outweigh the costs. Meanwhile, consumer inflation has not reached the targeted level of 2% yet. Citing Wakatabe, the outcome of qualitative and quantitative easing is viewed as clearly positive which will prop up the domestic economy further in the medium term.

Today Japan's PPI report was published with a downtick to 1.2% from the previous value of 1.3% which was expected to decrease to 1.1%. Ahead of Tertiary Industry Activity to be published tomorrow, which is expected to increase to 0.1% from the previous value of -0.6%, JPY is going to trade with higher volatility in the coming days.

To sum up, the recent economic reports made little impact on the pair. Australian reports revealed quite mixed readings. So, in this context the pair is going to trade with higher volatility. AUD may gain ground thanks to the positive employment change, but JPY is ruling in the pair.

Now let us look at the technical view. The price is currently trading at the support area of 75.50 where along the way certain Bullish Divergence is spotted. The price was bearish early today. The pair did not quite sustain it. Currently it is showing certain rejection off the support area which can push the price higher towards 77.50 before resuming the bearish trend.

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GBP/USD 5 Star Sell Signal | Fundamental Analysis

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FUNDAMENTALS:

Pound extended its decline to a 3 month low on escalating trade tensions between US and China and fading optimism that Brexit can be resolved. Sterling is the worst performer among its peers this week as the market is unconvinced that the UK Parliament can get her Brexit deal through the Parliament on the fourth try next month. With the opposition Labour saying that they would not support the bill in the current form, which Theresa May aims to pass it through the Parliament by June 3, it suggests a higher risks of a hard Brexit in November if Theresa May steps down, raising concerns about the prospect of an economically damaging deal. Options traders have increased bearish bets on the currency this week while asset managers remain short and leveraged funds cut their net long position to the lowest since March, according to latest data from the Commodity Futures Trading Commission.

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Trading recommendations for the GBPUSD currency pair - placement of trading orders (May 15)

For the last trading day, the pound / dollar currency pair showed high volatility of 94 points. As a result, a rapid decline continues--taking another profit from the market. From the point of view of technical analysis, we see that the bearish interest has not gone away and our predicted coordinates, 1.2920 - 1.2880, have been reached. Now, in an orderly manner, the correctional phase on May 9 made it possible to regroup the trading forces, due to which we dashingly broke through the level of 1.3000 held by us, but then we had an inertial move that overtook a number of periodic levels on its way. At the same time, we do not overlook the price fixing below the local minimum of 1.2865 (April 25), which was quite unexpected due to the growing overheating. So what supported the sellers? In fact, for a long time I have been trying to convey the idea that a pound fall in relation with their problems in Britain, but this is not what happened on the information background. The Conservative Party of Great Britain is already in a rather rigid form, by June 15, it is necessary to submit a draft agreement with the EU to the House of Commons that would suit everyone. And until then, Theresa May should resign. The conservatives also threatened May with the introduction of a new bill to the parliament, which could be prompted by the country's withdrawal without any deal with the EU.

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Today, in terms of the economic calendar, we have the publication of statistics on the United States, which, according to forecasts, are quite good. The number of building permits issued in April is growing from 1.288M to 1.290M. The number of initial claims for unemployment benefits is reduced from 228K to 220K. At the same time, if the negative background in Britain persists, the dollar will have another stimulus for growth.

Further development

Analyzing the current trading chart, we see that the downward interest remains and a fleeting pullback has passed into the "Low" update. Many may say that there is already a significant overheating of short positions. It has been shown, but at the same time, there is a strong downward background. And the quotation has a lot to decline. It is likely to assume that the bears will try to decline to the level of 1.2770-1.2720, which reflects our support and the low of February of the current year. At this coordinate, many traders consider profit taking and a possible correction.

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Based on the available data, it is possible to decompose a number of variations, let's consider them:

- Buy positions are considered in case of finding a pivot near the level of 1.2770, where a correction is possible in the case of working off.

- Positions for sale remain in the direction of the level of 1.2770-1.2720.

Indicator Analysis

Analyzing a different sector of timeframes (TF ), we see that indicators in all time frames tend to decrease, which is caused by 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 16, was based on the time of publication of the article)

The current time volatility is 31 points. Since there is a pivot point in the face of the level of 1.2770, volatility can be limited within the framework of the average daily indicator. However, if the inertial course continues with the support of the information background, the indicator might change.

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Key levels

Zones of resistance: 1.2880 (1.2865-1.2880) *; 1.2920 * 1.3000 **; 1.3180 *; 1,3300 **; 1.3440; 1.3580 *; 1.3700

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

* Periodic level

** Range Level

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Wave analysis of EUR / USD and GBP / USD for May 16. Euro and pound have nothing to oppose the US dollar

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On Wednesday, May 15, trading ended for EUR / USD with a decrease of several base points. I still pay attention to two unsuccessful attempts to break through the 50.0% Fibonacci level, which is a strong signal that the instrument is ready to build a new downward wave with targets located under the 11th figure. All participants in the foreign exchange market are now discussing the topic of trade wars, which Donald Trump is actively unleashing. And - there are a lot of opinions. As we can see, the markets are still inclined to believe that Trump's actions may favorably affect the US economy and the dollar is in use, although moderate, but in demand. The question for the next few days is: will Trump launch a full-scale offensive against the European Union? Markets fear that Trump will announce import duties on European cars. For Europe, this will be a serious blow.

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 is still in the process of building a downward trend. The current wave counting suggests a continuation of the pair decline with the targets of 1.1097 and 1.1045, which corresponds to 161.8% and 200.0% Fibonacci. Thus, now, I recommend selling a pair with these goals and a restrictive order above the 50.0% Fibonacci level.

GBP / USD

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On May 15, the GBP / USD pair lost another 60 basis points. This time, such a decline was not caused by weak and negative news from the UK. A permanently negative news background has now developed in the country, which regularly leads to a decline in the national currency. It is not surprising that the main outsider among all currencies remains the pound. Theresa May has long been dismissed without any concrete reason. Nevertheless, the prime minister stands firmly in her position: until the parliament approves Brexit, she will not leave her post. It seems that accepting Brexit is the only chance for Theresa May to be saved, if not her political career, then at least her reputation. However, now everything goes to the fact that the whole process of Brexit can end somehow, it can even lead to a rejection of it. All these have a negative impact on the business climate inside the country.

Sales targets:

.2780 - 127.2% Fibonacci

1.2675 - 161.8% Fibonacci

Purchase goals:

1.3175 - 0.0% Fibonacci

General conclusions and trading recommendations:

The wave pattern implies a continuation of the instrument decline within the wave c. Thus, now I recommend sales with targets located near the estimated marks of 1.2780 and 1.2675, which corresponds to 127.2% and 161.8% Fibonacci. An unsuccessful attempt at any of these marks can lead to a departure of quotes from the reached minimums and even the construction of a sufficiently strong upward wave.

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NZD/USD testing an intermediate support, could we see a bounce?

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Description :

Price is currently testing an intermediate support at 0.6558. If broken, it will confirm a further move down to its next support at 0.6520.

Entry : 0.6585

Why it's good : horizontal pullback resistance, 100% Fibonacci extension

Stop Loss : 0.6629

Why it's good : 61.8% Fibonacci retracementThe material has been provided by InstaForex Company - www.instaforex.com

EUR/JPY near key support, a bounce is possible!

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Description :

EURJPY near key support, a bounce to 1st resistance is possible

Entry:123.26

Why it's good :100% Fibonacci extension, 38.2% &23.6% Fibonacci retracement, horizontal swing high resistance

Stop Loss : 124.25

Why it's good :100% Fibonacci extension,50% Fibonacci retracement,horizontal swing high resistance

Take Profit : 122.10

Why it's good: 61.8% Fibonacci extension, horizontal swing low support

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The US economy continues to slow down. The demand for the yen is growing, the Canadian is trading in a range

The US-Chinese trade war remains the main driver in the financial markets. The absence of any new measures on both sides allowed the markets to recover a little yesterday, the S & P 500 added 0.58%. Gold futures stood before $ 1,300, but the lull is unlikely to be long, and panic may resume at any time.

Meanwhile, the volume of retail sales in the United States unexpectedly fell in April by 0.2%, an increase of 0.2% was predicted. Growth in consumer spending slowed to 1.2% y / y, that is, to a minimum for the year.

The decline in consumer activity is one of the main factors that bring the recession closer. The dynamics of the yields of inflation-protected Tips clearly illustrates this process; if a year ago the yield reached 2.16%, then the next peak in October was formed at the level of 2.07%. The last one in March is already at the level of 1.88%, and the trend is negative. This means that inflation in the US in the next couple of months may well fall to 1.6%, and this will be a direct call for the Fed to lower the rate.

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It is no coincidence that Trump has repeatedly called on the Fed to lower rates in order to spur economic activity. Trump is considering this possibility as one of the steps that will allow the US to defeat China in a trade war.

Along with the weakening of consumer demand, industrial output fell by 0.5% in April. Production capacity utilization was 77.9% against 78.5 % a month earlier. The physical volume of US-manufactured goods is declining, despite tax reform and the desperate attempts of the Trump administration to get the most favored treatment from major trading partners. Trump was able to quite quickly break the resistance of Mexico and Canada and reformat the NAFTA agreement in his favor, there is no doubt that the ongoing negotiations with Japan will also be completed effectively, after which Europe's turn will come. However, it's not even the result of the new administration.

There are no changes in the structure of the US economy, as there is no positive dynamics. The ratio of industrial production to GDP continues to decline, that is, no emergency measures lead corporations to return their production assets to the United States. Neither tax reform, oil production growth, nor trade barriers help.

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The steady growth of the labor market also causes skepticism. The growth of new jobs is proceeding at the same rate as the growth of falling out of the labor force. Their ratio is at minimal levels, which clearly indicates that the positive dynamics of the labor market is only the result of manipulating statistics.

The US is not interested in a trade agreement with China, but in its full and unconditional surrender. Only such a result will allow "to make America great again," any other will inevitably bring the recession closer.

USDCAD

The Canadian dollar continues to trade in the range, while maintaining stability against the background of a decline in kiwi and aussie. The reason is not only stable oil prices, but also a good internal dynamics - business activity, according to Ivey, steadily keeps above 55p. The growth of average wages maintains stable inflation at a target level of 2.0%. The Bank of Canada has not yet expressed any intention to lower the rate or take more measures to mitigate monetary policy.

The trade balance is steadily surplus. Financial flows are stable. The report on the movement of foreign capital. There are no reasons to assume that the Canadian has decreased. Support 1.3375 / 80, resistance 1.3490 / 3505, slightly more likely to move up to the border of the range.

USDJPY

The Bank of Japan does not intend to make changes to the monetary policy until 2020, and the yen dynamics are shaped by both a reassessment of market risks and a slowdown in the growth of the money supply. Both of these factors are in favor of the yen so far, so the decline in USDJPY seems logical. The yen will move to support 109.00 / 15, it is logical to use growth attempts for sales.

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GBP/USD: plan for the European session on May 15. The bearish trend continues, and buyers of the pound can count on another

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

The optimal scenario for stopping the bearish trend will be the test of the support level 1.2812 with confirmation of the divergence on the MACD indicator, which is now being formed. Only this will allow us to expect a return above the range of 1.2877, from which we can expect a more significant demand for GBP/USD in the area of highs 1.2930 and 1.2983, where I recommend fixing the profits. In the scenario of further decline of the pair and the lack of rapid market movement up from the support of 1.2812, it is best to look at long positions on the rebound from the minimum of 1.2769 and 12723.

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

The lack of news on Brexit and differences between the UK parties continue to push the pound down. The bearish trend continues, and the sellers' target today will be at least 1.2812, a breakthrough of which will lead to a larger decline in the pair to the support area of 1.2769 and 1.2723, where I recommend fixing the profits. However, before selling for a breakdown around 1.2812, you should pay attention to the bullish divergence of the MACD indicator, which may limit the downward potential. In the case of a pound growth in the first half of the day, short positions can be returned to the false breakdown in the resistance area of 1.2877 or consider short positions to rebound from a maximum of 1.2930.

Indicator signals:

Moving Averages

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

Bollinger Bands

In case of further decline of the pound, the support will be provided by the lower limit of the indicator around 1.2812.

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Description of indicators

  • MA (moving average) 50 days - yellow
  • MA (moving average) 30 days - green
  • MACD: fast EMA 12, slow EMA 26, SMA 9
  • Bollinger Bands 20
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EUR/USD: plan for the European session on May 16. Weak data on the US economy did not allow the euro to fall even lower

To open long positions on EURUSD, you need:

The pressure on the EURUSD pair fell yesterday afternoon after weak reports on the US economy. At the moment, buyers need to return and consolidate above the resistance of 1.1215, after which we can expect a new bullish momentum in order to update the highs of 1.1242 and 1.1275, where I recommend fixing the profits. If the pressure on EURUSD continues, purchases can be returned after the formation of a false breakdown in the support area of 1.1183 or to rebound from a minimum of 1.1155.

To open short positions on EURUSD, you need:

Today's meeting of the Eurogroup may limit the demand for the European currency. The formation of a false breakdown in the resistance area of 1.1215 will be the first signal to open short positions in EURUSD, which will keep the pair in a downward price channel and return to the market sellers who are counting on a repeat support test of 1.1183. The main purpose of the bears today will be a test of a minimum of 1.1155, where I recommend fixing the profits. In the growth and consolidation above the resistance of 1.1220, it is best to open short positions on the rebound from the maximum of 1.1242.

Indicator signals:

Moving Averages

Trading is conducted in the area of 30 and 50 moving averages, which indicates the likely completion of the downward trend of the euro.

Bollinger Bands

The growth of the euro will be limited by the upper limit of the indicator in the area of 1.1220, while the pressure will increase after the breakdown of the lower limit in the area of 1.1195.

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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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Burning forecast EURUSD 05/16/2019

On Wednesday, the euro came under pressure from sales. However, by the end of the day, the euro showed an optimistic turn upwards - and buyers had a chance to see the movement again at last.

Perhaps, the data package on the US economy — all data came out frankly weak — from retail sales to industrial production — was provided.

We keep buying from 1.1220, and stop at 1.1175 became even more reasonable.

Possible purchases are from 1.1270.

In the case of a turn downwards, we sell from 1.1130

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EUR / USD h4. Options for the development of the movement from May 16, 2019. Analysis of APLs & ZUP

Minute ( h4 )

Euro vs US Dollar

____________________

On May 16, 2019, the development of the movement of the single European currency EUR / USD will be determined by the direction of the range breakdown :

-> resistance level of 1.1230 (initial SSL line of the Minuette operating scale fork);

-> support level of 1.1215 (upper limit of the channel 1/2 Median Line Minuette).

____________________

Prospects for the development of the upward movement (buy)

The breakdown of the resistance level of 1.1230 (the initial SSL line of the Minuette operational scale forks) together with ISL38.2 Minuette (1.1235) will determine the further development of the movement of the single European currency in the equilibrium zone (1.1235 <-> 1.1263 <-> 1.1295) of the Minuette operational scale forks.

Details are shown in animated graphics.

____________________

Prospects for the development of a downward movement (sell)

The breakdown of the support level of 1.1215 will make the development of the EUR / USD movement in the 1/2 Median Line Minuette channel relevant (1.1215 <-> 1.1200 <-> 1.1182). In the case of a breakdown of the lower boundary (1.1182) of the channel, the downward movement of EUR / USD may continue to the boundaries of the channel 1/2 Median Line (1.1160 <-> 1.1135 <-> 1.1115) Pitchfork operating scale Minute.

Details look at the animated graphics.

____________________

The review was compiled without taking into account the news background. Thus, the opening of trading sessions of the main financial centers and is not a guide to action (placing orders "sell" or "buy").

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Trading Plan for EUR / USD and GBP / USD pairs on 05/16/2019

For the first half of the day, the single European currency was engaged only in what was going down and its attitude could not be stopped even by the GDP data for the first quarter, which showed that the economic growth rate remained unchanged, instead of slowing down from 1.2% to 1%. The negative attitude towards the single European currency was fueled by expectations from American statistics, which did not materialize, from which the dollar had to give up its positions in the second half of the day. Thus, the growth rate of industrial production slowed from 2.3% to 0.9%, which should have remained unchanged. Also, the growth rate of retail sales slowed down from 3.8% to 3.1%, from which acceleration was expected. The only thing that could somehow please is the commercial reserves, which have not changed in a month. In many respects, the slowdown in industrial production growth rates is due to the continued growth of warehouse stocks. Thus, the possibility of even a recession in the industry is not excluded, especially if consumer activity decreases.

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Yet, the pound confidently moved down because in Foggy Albion. They again remembered Brexit. Representatives of the conservative party demand that Theresa May resolve the issue as soon as possible. The Prime Minister is required to submit to the House of Commons by June 15 a draft agreement with the European Union, which will be arranged by the Parliament. After which, Teresa May should immediately resign. Otherwise, she was threatened with submitting a new bill to Parliament, which could provide for resettlement from the European dormitory without any agreement. Teresa May is trying to gain time and once again promising that in June she will provide the House of Commons with a version of Brexit that suits everyone. Although such statements cause many doubts, as negotiations with the head of the opposition Jeremy Corbin ended in complete failure. I.e, Whatever option Theresa May offered to Brexit, he will not be satisfied with this or that half of the parliamentarians. Hence, it will be rejected in any case.

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Today, only the United States will please us with some statistics. Like yesterday, the forecasts for them are quite optimistic. In particular, the total number of applications for unemployment benefits should be reduced by 12 thousand. Thus, the number of initial applications for unemployment benefits can be reduced by 8 thousand and the repeated applications by 4 thousand. Also, the number of construction projects is expected to increase by 66 thousand and the construction permits issued for 10 thousand. Thus, if yesterday's scenario does not repeat, then the dollar will be able to continue its growth when the actual data turned out to be diametrically opposed to the forecast.

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The euro/dollar currency pair reached a recent cluster of 1.1180, where it felt a foothold and turned around. Probably, we can assume a temporary fluctuation in the range of 1.1180/1.1220.

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The pound/dollar currency pair continues to please traders with a downward movement, overcoming the local minimum on April 25 on the way. We can assume a primary stagnation at 1.2825/1.2860 and in case of a breakdown of the lower boundary, we will continue the outgoing movement towards 1.2800-1.2770.

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BITCOIN struggling at around $8,000, May 16, 2019

Bitcoin leapt higher above $8,000 and reached $8,370 amid the confident bullish momentum. However, it could not sustain the bullish pressure which resulted in a retracement towards $8,000 again.

Bitcoin extended upsides above $8,280 and $8,300. The price briefly touched a new 2019 high near $8,370, but it failed to continue a rally. According to reports and speculations, this time Bitcoin is expected to eclipse the previous crypto bubble momentum which could push Bitcoin to gain a higher value than ever before. With a bottom essentially confirmed, the price of Bitcoin has risen sharply due to FOMO. A new wave of speculative hope makes crypto analysts reflect on the winning streak that used to bring Bitcoin to its all-time high of $20,000. Experts are wondering what has changed since that time and what could lead to an even larger bullish run this time around.

Another reason is a wide variety of options available for investors, even institutions, to gain exposure into crypto markets. With Bakkt on the way, Fidelity having launched, and many more, Bitcoin is easier to invest in than before. Moreover, Bitcoin is even more valuable during the economic turmoil, is its value as an uncorrelated asset. The fact that Bitcoin and other cryptos don't follow other markets makes it an ideal choice for portfolio diversification.

To sum up, Bitcoin is still quite impulsive with the bullish momentum. The price is currently making corrections at near $8,000 from where it is expected to reach $8,500 and later the milestone price area of $10,000 in the coming days. As the price remains above $7,500-8,000 support, the impulsive bullish bias is expected to continue.

SUPPORT: 7,500, 7,850, 8,000

RESISTANCE: 8,250, 8,500, 8,750

BIAS: BULLISH

MOMENTUM: VOLATILE

analytics5cdd0b77c675c.png

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Indicator analysis. Daily review for May 16, 2019 for the GBP / USD pair

Trend analysis (Fig. 1).

On Thursday, technical analysis demonstrates an upward movement. The first upper target of 1.2877 is the pullback level of 14.6% (yellow dotted line).

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Fig. 1 (daily schedule).

Comprehensive analysis:

- indicator analysis - up;

- Fibonacci levels - up;

- volumes - down;

- candlestick analysis - up;

- trend analysis - down;

- Bollinger lines - down;

- weekly schedule - down.

General conclusion:

On Thursday, technical analysis demonstrates an upward movement. The first upper target of 1.2877 is the pullback level of 14.6% (yellow dotted line).

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AUDUSD: Australian Dollar to lose further momentum against USD? May 16, 2019

The Australian dollar lost further momentum against the greenback today after the release of mixed employment data. As a result, the market sentiment was undermined and the Australian dollar lost ground.

Today, Australia employment change report was published. According to the data, the reading increased to 28.4k from the previous figure of 27.7k which was expected to decrease significantly to 15.2k. Despite the considerable improvements in employment change, the unemployment rate rose to 5.2% from 5.1%. Analysts expected a decrease to 5.0%. Additionally, Michele Bullock, assistant financial system governor of the Reserve Bank of Australia (RBA), spoke today about the upcoming payment system in Australia which would enhance the transactions and customer experiences in the future. Bullock did not touch upon the topic of unemployment rate in her speech.The market participants were slightly discouraged. Thus, the Australian dollar might gain momentum if the US dollar asserts strength as well.

Moreover, recently US Retail Sales report has been published. The reading significantly decreased to -0.2% from the previous figure of 1.7% which was expected to be at 0.2%. Core Retail Sales also tumbled to 0.1% from 1.3%. Economists expected the reading to be near 0.7%. Despite the weak economic data, the US dollar managed to sustain the momentum as the FED remained quite positive about economic growth. Hence, the economy sustained an uptrend and managed to attract USD bulls. Amid good economic signals, the Fed saw no need in the interest rate hike and cut. The US-China trade conflict is expected to have a significant impact on the US economy which may slow down or lose momentum.

Presently, the US dollar is stronger than the Australian dollar despite a moderate slowdown of the greenback after the weak retail sales report. However, the US dollar remains at a high level. Thus, further gains and long-term sustainability are expected.

Now let us look at the technical view. The price is currently quite bearish while forming Bullish Divergence in MACD histogram. The price has already managed to reject certain bearish momentum which is expected to lead the price higher towards 0.70-0.7050 resistance area before the bearish trend continues to dominate again with a target towards 0.6850 support area in the coming days. As the price remains below 0.7050 area with a daily close, the impulsive bearish momentum is expected to continue further.

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