Indicator analysis. Daily review for June 6, 2019 for the GBP / USD currency pair

Trend analysis (Fig. 2).

On Thursday, we are waiting for a downward movement with the first target of 1.2651 - a sliding level of 50.0% (blue dashed line). Much will depend on the news that will come out at 11:30 UTC+00.

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Fig. 2 (daily schedule).

Comprehensive analysis:

- indicator analysis - up;

- Fibonacci levels - down;

- volumes - up;

- candlestick analysis - down;

- trend analysis - up;

- Bollinger lines - down;

- weekly schedule - up.

General conclusion:

On Thursday, we are waiting for a downward movement with the first target of 1.2651 - a sliding level of 50.0% (blue dashed line). Much will depend on the news that will come out at 11:30 (UTC+00).

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Elliott wave analysis of GBP/JPY for June 6, 2019

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The recovery from 136.53 does look promising indicating more upside pressure once the ongoing correction is complete. This correction could move a bit closer to 137.05 before renewed upside pressure should be expected for a re-test of minor resistance at 137.79 and a break above here, will confirm that wave 2 completed with the test of 136.53 and a new impulsive rally is building for an ultimate break above 148.87.

R3: 138.46

R2: 138.01

R1: 137.79

Pivot: 137.44

S1: 137.05

S2: 136.84

S3: 136.53

Trading recommendation:

We are long GBP from 137.50 with our stop placed at 136.50.

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Elliott wave analysis of EUR/JPY for June 6 - 2019

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EUR/JPY tested important resistance at 122.26, but was repelled lower from here. This means, we can not say for sure, that wave ii completed with the test of 120.75, but we find the odds for a bottom being in place at 120.75. Therefore, we still need the final proof in the form of a clear break above 122.26.

in the short term, we will be looking for a corrective dip from 122.26 to the 121.28 - 121.33 area from where a new attack on important resistance at 122.26 is expected and a break above will confirm that wave iii higher is developing, but also activate a should/head/shoulder bottom for a strong rally higher towards at least 123.67.

R3: 122.65

R2: 122.26

R1: 121.80

Pivot: 121.60

S1: 121.40

S2: 121.28

S3: 120.95

Trading recommendation:

We're awaiting EUR from 120.75 with our stop placed at 120.70.

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Trading plan for EURUSD for June 06, 2019

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Technical outlook:

The wave structure presented here indicates a more clear picture for EURUSD. Please note that despite EURUSD touched 1.1300 levels yesterday, a sharp reversal from there may lead to an increase . Also note that the rally from 1.1107 through 1.1300 levels is still 3 waves, and hence corrective. The EURUSD pair has unfolded into a complex correction since the lows at 1.1111 levels earlier. It is safe to remain short from what was discussed yesterday, keeping risk above 1.1320 levels respectively. Intraday rallies remain possible through 1.1270 levels, but prices should remain well capped below 1.1300 levels, if this scenario works out. Immediate swing resistance is seen around 1.1320 levels and till price stay below that. Bears are expected to remain in control. Fresh short positions can be taken during intraday rallies towards 1.1260/70 levels in the coming 1-2 sessions, We shall re-evaluate the situation around 1.1160 levels going forward.

Trading plan:

Remain short with stop above 1.1320, target below 1.1107 levels.

Good luck!

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Forecast for USD / JPY pair on June 6, 2019

USD / JPY pair

On Wednesday, the yen once again tried to reach the target level at least to January 10 level of 107.78 but turned up after receiving support from strengthening of the dollar. On the daily chart, convergence has become more pronounced. On the four-hour chart, Marlin's oscillator signal line is in the growth zone. But as we said before, it needs to go above the trend line of the price channel in the area of 109.25 (daily) in order to create stable prices for growth.

In the process of difficult growth, we are waiting for the price to reach the MACD line at 108.95 on the four-hour chart and a possibility for further rollback before attacking the resistance of the price channel.

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GBP/USD: plan for the European session on June 6. The pound was taken hostage by the US economy data

To open long positions on GBP/USD you need:

Yesterday, pound buyers attempted to continue growth after the release on data on the service sector and reached a resistance of 1.2744, to which I paid attention. At the moment, their task is to return and consolidate above the 1.2700 area, which will keep the upward potential in the pair and will lead to a repeated update of the high of 1.2744, where I recommend taking profits. In case of further decline, it is best to return to long positions from a low of 1.2650 or from a larger support of 1.2594.

To open short positions on GBP/USD you need:

Pound sellers will expect the formation of a false breakdown in the resistance area of 1.2700, which was formed yesterday after good answers on the state of the US economy. Only in such a scenario can we expect the pound to further decrease to the support area of 1.2650 and an update of the low of 1.2594, where I recommend taking profits. If the bulls manage to return to resistance at 1.2700 in the first half of the day, it is best to open short positions to rebound from resistance at 1.2744.

Indicator signals:

Moving averages

Trade is conducted below 30 and 50 moving averages, which indicates a return of bearish sentiment.

Bollinger bands

In the event that the pound further decreases, support will be provided by the lower limit of the indicator in the area of 1.2660. A break of the middle border in the 1.2700 area will return the demand for the British pound.

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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 European session on June 6. GDP data will determine the tone of Mario Draghi's statements

To open long positions on EURUSD you need:

Today, a decision on the interest rate in the eurozone will be published, as well as data on GDP, which may put pressure on the euro. Buyers need to climb to the resistance level of 1.1241, and only with a good report on economic growth rates can we be able to expect EUR/USD to rise to the highs of 1.1273 and 1.1304, where I recommend taking profits. In the event of a further decline, before the ECB's decision and against the background of profit taking, it's best to return to long positions in the euro on a false breakdown from support at 1.1200 or rebound from a low of 1.1163.

To open short positions on EURUSD you need:

An unsuccessful breakthrough and a return below the level of 1.1271 during the release of data on the state of the eurozone economy will be the first signal to open short positions in the euro, the purpose of which will be a support of 1.1200, where I recommend taking profits. However, the main weekly task will be to return to a low of 1.1163, but this will only happen if European Central Bank President Mario Draghi speaks negatively. If the growth scenario is above 1.1241 in the first half of the day, you can take a closer look at short positions from a resistance of 1.1273 or sell the euro to rebound from a high of 1.1304.

Indicator signals:

Moving averages

Trade is conducted below 30 and 50 moving averages, which indicates that pressure on the euro remains.

Bollinger bands

A break of the middle border of the indicator in the area of 1.1241 may lead to an increase in the euro in the first half of the day, while the lower limit in the 1.1200 area will support the decline in the pair.

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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

Fractal analysis of major currency pairs on June 6

Dear colleagues,

For the Euro/Dollar pair, the price forms the potential for the downward movement of June 5 to the key support level of 1.1274. On the Pound/Dollar pair, we are following the development of the ascending structure from May 31. Hence, we expect a continuation of the upward movement after the breakdown 1.2727. For theDollar/Franc pair, the price forms the potential for the upward movement of June 5 to the key support level of 0.9876. For the Dollar/Yen pair, the price is in the correction zone at the moment. We can expect a continuation of the movement to the bottom after the breakdown 107.76. For the Euro/Yen pair, the price forms the potential for the top of June 3. The upward cycle development is expected after the breakdown of 121.98. The Pound/Yen pair forms a small potential for the top of June 4. We expect a development of this structure after the breakdown of 137.85.

Forecast for June 6:

Analytical review of H1-scale currency pairs:

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For the Euro/Dollar pair, the key levels on the H1 scale: 1.1310, 1.1274, 1.1254, 1.1238, 1.1214, 1.1198, 1.1187 and 1.1152. Here, the price forms the potential for the downward movement of June 5th. We expect the continuation of the development of the downward structure after the breakdown of 1.1214, which in this case, the goal is consolidation near the level of 1.1198. Passing through the noise range of 1.1198 - 1.1187 will lead to the development of a pronounced motion. Here, the potential target is 1.1152.

The short-term downward movement will possibly be in the area of 1.1238 - 1.1254. The breakdown of the latter value will lead to a prolonged correction with the target key support for the downward structure at 1.1274. Its price will have the formation of the initial conditions for the upward cycle, which in this case, the potential target is 1.1310.

The main trend is the formation of the potential for the downward movement of 5 June.

Trading recommendations:

Buy 1.1238 Take profit: 1.1252

Buy 1.1255 Take profit: 1.1274

Sell: 1.1214 Take profit: 1.1200

Sell: 1.1185 Take profit: 1.1152

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For the Pound/Dollar pair, the key levels on the H1 scale are 1.2808, 1.2789, 1.2754, 1.2727, 1.2687, 1.2667 and 1.2633. Here, we continue to monitor the development of the upward cycle of May 31, while the price is in the correction area at the moment. We expect a continuation of the movement after the breakdown of 1.2727, which in this case, the goal is consolidation near the level of 1.2754. A break at 1.2755 should be accompanied by a pronounced upward movement with the target of 1.2808 in the area of price consolidation at 1.2789 - 1.2808. From here, we expect a rollback to the bottom.

A short-term downward movement will possibly be in the area of 1.2687 - 1.2667. The breakdown of the latter value will lead to a prolonged correction with the target key support for the rising structure at 1.2633.

The main trend is the upward cycle of May 31 at the stage of correction.

Trading recommendations:

Buy: 1.2728 Take profit: 1.2752

Buy: 1.2755 Take profit: 1.2787

Sell: 1.2686 Take profit: 1.2668

Sell: 1.2664 Take profit: 1.2638

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For the Dollar/Frank pair, the key levels on the H1 scale: 1.0048, 1.0024, 0.9987, 0.9970, 0.9954, 0.9925, 0.9903, 0.9876 and 0.9840. Here, the price forms the potential for upward movement from June 5th. We expect a continuation of the movement after the breakdown of 0.9954, which in this case, the target is consolidation near the level of 0.9970. The passage of the price range of 0.9970 - 0.9987 will lead to the development of a pronounced upward movement with the target of 1.0024. We consider the level of 1.0048 as a potential value for the top. Upon reaching this level, we expect consolidation and a rollback to the bottom.

A short-term downward movement will possibly be in the area of 0.9925 - 0.9903 and breaking the last value will lead to a prolonged correction with the target of 0.9876. This level is key support for the top and its price will lead to the subsequent development of the main trend, with the potential target of 0.9840.

The main trend is the downward cycle of May 30, the formation of potential for the top of June 5.

Trading recommendations:

Buy : 0.9955 Take profit: 0.9970

Buy : 0.9988 Take profit: 1.0024

Sell: 0.9925 Take profit: 0.9904

Sell: 0.9901 Take profit: 0.9878

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For the Dollar/Yen pair, the key levels on the scale are 108.84, 108.43, 108.18, 107.76, 107.44 and 106.99. Here, we continue to monitor the downward structure of May 30. We expect a short-term downward movement in the area of 107.76 - 107.44. The breakdown of the last value will lead to the movement to the potential target of 106.99 and upon reaching this level, we expect a rollback to the top.

A short-term upward movement and consolidation are possible in the area of 108.18-108.43. The breakdown of the latter value will lead to in-depth correction. Here, the target key support for the downward cycle is 108.84.

The main trend is the local structure for the bottom of May 30 at the stage of correction.

Trading recommendations:

Buy: 108.18 Take profit: 108.41

Buy: 108.45 Take profit: 108.82

Sell: 107.75 Take profit: 107.45

Sell: 107.42 Take profit: 107.00

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For the Canadian dollar/Dollar pair, the key levels on the H1 scale: 1.3458, 1.3432, 1.3414, 1.3386, 1.3369, 1.3339 and 1.3313. Here, we are following the development of the downward structure of May 31, while the price is in the correction at the moment. The continuation of the development of the main trend is expected after the price passes the noise range of 1.3386 - 1.3369, which in this case, the target of 1.3339. We consider the level of 1.3313 with the potential value for the bottom. After reaching of which, we expect to go to the correction zone.

Short-term upward movement will possibly be in the area of 1.3414 - 1.3432 and the breakdown of the latter value will lead to a prolonged correction to the target key support for the bottom at 1.3458.

The main trend is the downward structure of May 31.

Trading recommendations:

Buy: 1.3415 Take profit: 1.3431

Buy : 1.3433 Take profit: 1.3456

Sell: 1.3368 Take profit: 1.3340

Sell: 1.3337 Take profit: 1.3315

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For the Australian dollar/Dollar pair key levels on the H1 scale are 0.7058, 0.7042, 0.7013, 0.7003, 0.6987, 0.6953, 0.6941 and 0.6924. Here, we are following the rising structure of May 23,while the price is in deep correction at the moment. We expect a continuation of the movement after the breakdown at the level of 0.698. Here, the first target is 0.7003. Passing through the noise range of 0.7003 - 0.7013 will lead to the development of a pronounced movement, which in this case the goal is 0.7042. We consider the level of 0.7058 with the potential value for the top, after reaching of which, we expect consolidation and a rollback to the bottom.

The range of 0.6953 - 0.6941 is a key support for the top, its price passage will lead to the formation of the initial conditions for the downward cycle, in this case the potential target is 0.6924.

The main trend is the ascending structure of May 23 at the stage of deep correction.

Trading recommendations:

Buy: 0.6988 Take profit: 0.7003

Buy: 0.7014 Take profit: 0.7040

Sell : 0.6953 Take profit : 0.6943

Sell: 0.6939 Take profit: 0.6925

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For the Euro/Yen pair, the key levels on the H1 scale: 122.82, 122.31, 121.98, 121.71, 121.20, 121.01, 120.56 and 119.98. Here, the price forms the potential for upward movement of June 3 in the correction of the downward structure. We expect a continuation of the movement after the breakdown of 121.71. Here, the first target is 121.98 and the breakdown of this level will lead to the development of an upward trend, which in this case the target is consolidation near 122.31. We consider the level of 122.82 with the potential value for the top after the breakdown of 122.35.

A short-term downward movement is expected in the area of 121.20 - 121.01. The breakdown of the last value will cancel the ascending structure from June 3, and in this case, we expect movement to the level of 120.56. We consider the level 119.98 to be a potential value for the bottom and a rollback to the top from this level is expected.

The main trend is the design of the initial conditions for the ascending cycle of June 3.

Trading recommendations:

Buy: 121.71 Take profit: 121.96

Buy: 122.00 Take profit: 122.30

Sell: 121.20 Take profit: 121.03

Sell: 120.98 Take profit: 120.58

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For the Pound/Yen pair, the key levels on the H1 scale are : 138.39, 137.83, 137.49, 136.52, 135.98, 135.48 and 134.82. Here, the price is still in the correction zone from the downward trend and forms a small potential for the top of June 4. We expect the continuation of the development of the downward trend of May 21 after the breakdown of 136.50, which in this case, the target is 135.98. In turn, the breakdown of which will allow us to expect to move to consolidation near 135.48. Also from here, there is a high probability of a reversal in the correction. We consider the level of 134.82 with the potential value for the bottom

A short-term upward movement is expected in the area of 137.49 - 137.83. The breakdown of the last value will lead to a prolonged correction with the target of 138.39. The noise range is at 138.39 - 138.76.

The main trend is the local downward structure of May 21 at the stage of correction.

Trading recommendations:

Buy: 136.50 Take profit: 136.00

Buy: 135.94 Take profit: 135.50

Sell: 137.46 Take profit: 136.90

Sell: 135.44 Take profit: 134.84

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Technical analysis of Ethereum for 06.06.2019

Crypto Industry News:

Brazilian banks will implement a new standardized identification solution based on the Hyperledger Fabric platform.

The identity solution - developed jointly by IBM and the central bank of the country, CIP - is to be integrated with the Brazilian payment system (SPB) - a system used by all banks and financial institutions in the country.

The new Blockchain platform has been reportedly designed to authenticate and verify digital identities for users' bank accounts using information about the mobile phone and SIM card in combination with other personal data from smartphones. The combined data will be used to generate a secure identifier registered on Blockchain, which can be used by the institutions to authenticate the access credentials.

Both IBM and the central bank during an important CIAB Febraban event in the field of banking technologies in Latin America confirmed that on June 11 a new Bank-focused Blockchain platform will be launched. However, they have not officially confirmed all the details of the product.

After launch, the platform is to be the first banking solution for many institutions operated by Blockchain.

Technical Market Overview:

The ETH/USD pair has been trading in a narrow range between the levels of $233.74 - $251.08 for some time now and bulls still did not try to break through the trendline. The whole wave down labeled as 4/(a) might terminate around the level of $228.89 and then it will be labeled as three waves correction ABC or it can continue to evolve into an ABCDE Triangle pattern. Please notice, the price is still trading below the short-term descending trend line resistance as well.

Weekly Pivot Points:

WR3 - $337.31

WR2 - $312.54

WR1 - $290.33

Weekly Pivot - $263.28

WS1 - $241.64

WS2 - $214.59

WS3 - $190.10

Trading Recommendations:

The best strategy in the current market conditions is to trade in the direction of the main trend, which is still up. All the local bounces and correction should be treated as another opportunity to open the buy orders for a better price. Please notice, the larger time frame trend is up and there are no signs of any trend reversal.

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Technical analysis of Bitcoin for 06.06.2019

Crypto Industry News:

According to financial media reports, Hester Peirce, a commissioner in the US securities regulatory body, insisted on a less cautious approach to innovation in the ETF market in the regulatory market.

According to the publication, Peirce from the Securities and Exchange Commission (SEC), called on the other commissioners to allow innovation in the ETF space by reducing their caution. Apparently, she commented on the body's approach to this category of highly regulated financial instruments, stating that the SEC "is still suppressing ETF funds with individual attention as if they were infants".

Peirce also noted that he thinks the regulator was wrong about his decision to reject the bitcoin-based ETF application introduced by the Winklevoss twins who are also founders of the Gemini cryptocurrency exchange. According to Peirce, the ETF will encourage institutional investors to participate in the cryptocurrency market.

Technical Market Overview:

The BTC/USD pair has hit the target level for the wave c correction at $7,484 and now is trading inside of a narrow zone between the levels of $7,484 - $7, 896. The nearest technical resistance is seen at the level of $7,978 and only is this level is clearly violated, then the short-term outlook can change from bearish to bullish. Otherwise, the horizontal movement will continue until the breakout.

Weekly Pivot Points:

WR3 - $10,284

WR2 - $9,622

WR1 - $9,121

Weekly Pivot - $8.545

WS1 - $8,037

WS2 - $7,438

WS3 - $6,960

Trading Recommendations:

The best strategy in the current market conditions is to trade in the direction of the main trend, which is still up. All the local bounces and correction should be treated as another opportunity to open the buy orders for a better price. Please notice, the larger time frame trend is up and there are no signs of any trend reversal. The level of $7,487 might be the bottom for wave 4.

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Technical analysis of EUR/USD for 06.06.2019

Technical Market Overview:

The EUR/USD has ignored the first warning sign of Shooting Star candlestick pattern and broke through the technical resistance zone located between the levels of 1.1264 - 1.1274. The bulls have managed to make a new local high at the level of 1.1305, but the rally did not last long and reversed after the Bearish Engulfing candlestick pattern was made. The move down was sudden and hit the technical support at the level of 1.1224, so the price is back under the kay technical resistance again and more downside is expected as the market conditions are overbought.

Weekly Pivot Points:

WR3 - 1.1310

WR2 - 1.1261

WR1 - 1.1211

Weekly Pivot - 1.1159

WS1 - 1.1114

WS2 - 1.1061

WS3 - 1.1012

Trading Recommendations:

The best strategy in the current market conditions is to trade in the overbought and oversold market conditions as long as the price is moving inside of the consolidation zone. Any breakout in either direction (the larger time frame trend is down) will eventually give the direction for the short-term trend move and this is when the strategy for a breakout will be applicable.

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Technical analysis of GBP/USD for 06.06.2019

Technical Market Overview:

The GBP/USD pair has almost tested the technical resistance at the level of 1.2747 as the local high was made at the level of 1.2742 before the Bearish Engulfing candlestick pattern was made and the price reversed. Currently, the market is testing the nearest technical support at the level of 1.2683 in the overbought conditions. The momentum is barely above its fifty levels, so the up move is not expected as the price might return to the downtrend any time now.

Weekly Pivot Points:

WR3 - 1.2903

WR2 - 1.2819

WR1 - 1.2711

Weekly Pivot - 1.2636

WS1 - 1.2534

WS2 - 1.2447

WS3 - 1.2331

Trading Recommendations:

The best strategy in the current market conditions is to trade in the direction of the main trend, which is still down. All the local bounces and correction should be treated as another opportunity to open the sell orders for a better price. Please notice, the larger time frame trend is down and there are no signs of any trend reversal.

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Forecast for EUR/USD for June 6, 2019

EUR/USD

As we expected in the last review, the euro did not have enough fuse to reach the target level of 1.1324. The price very quickly returned below the internal line of the price channel, which formed, albeit weak, but the divergence of price with the Marlin oscillator on the four-hour chart.

Losses were capped at the Fibonacci level of 100.0% (1.1216) and at the time that the Marlin signal line on the H4 reached the border of the decline zone. Thus, the oscillator received detente and formally growth was able to continue, as the trend in both charts remains increasing, but the decline occurred on large volumes, which indicates the closing of positions before today's meeting of the ECB.

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From today's meeting, investors are waiting for details on the TLTRO program. But this may not be the case, since the program, launched in the fall, will be conducted under the leadership of the new ECB Chairman, who may not like the "details". On the other hand, TLTRO in the current situation (as well as five years ago) is not so much a stimulus for business lending as a veiled program of quantitative easing. Therefore, even if the program's provisions are made public today, they are unlikely to have a noticeable impact on the market, especially in terms of growth. From this point of view, we expect that the divergence on the four-hour chart will be the first sign of a reversal of the trend for a further decrease.

The second sign will be when the price overcomes the MACD support lines on the charts of both scales, this is the range 1.1185-1.1192. The goal of the decline is 1.1155 – the Fibonacci level of 110.0%. Next at 1.1075.

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Forecast for GBP/USD for June 6, 2019

GBP/USD

On the daily chart, the British pound did not reach the price channel line slightly (a target of 1.2756). Due to the rapid price drop in the evening, the signal line of the Marlin oscillator also did not reach the border line with the territory of the bulls.

To further reduce the price, it is necessary to overcome the level of 1.2660, which is the low of December 4 and August 15, 2018. At this moment the signal line of the marlin oscillator on H4 will be in the decline zone. Success will pave the way to the closest target level of 1.2603 - the low of May 23 and the MACD line of the four-hour chart. Next, 1.2530 is the low of 14 December.

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June 6, 2019 : EUR/USD Intraday technical analysis and trade recommendations.

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Since January 19th, the EURUSD pair has been moving within the depicted channel with slight bearish tendency.

Few weeks ago, a bullish Head and Shoulders reversal pattern was demonstrated around 1.1200 allowing further bullish advancement to occur towards 1.1300-1.1315 (supply zone) where significant bearish rejection was demonstrated on April 15.

For Intraday traders, the price zone around 1.1235 stood as a temporary demand area which paused the ongoing bearish momentum for a while before bearish breakdown could be executed on April 23.

Short-term outlook turned to become bearish towards 1.1175 (a previous weekly bottom which has been holding prices above for a while)

On the period between May 17th and 20th, a bearish breakdown below 1.1175 was temporarily achieved.

As expected, further bearish decline was expected towards 1.1115. This is where significant bullish recovery was demonstrated bringing the EURUSD pair back above 1.1175.

Recently, The EURUSD pair has maintained bullish persistence above the highlighted price level (1.1175). That's why, further bullish advancement was expected towards 1.1235 which failed to apply any significant bearish pressure.

Bullish breakout above 1.1235 renders it a newly-established demand level to be watched for bullish rejection and a valid BUY.

Bullish persistence above 1.1235 enhances further bullish advancement towards 1.1290 and 1.1320.

On the other hand, bearish persistence below 1.1235 would probably allow further bearish decline to occur towards 1.1175.

Trade recommendations :

Intraday traders should look for a valid BUY entry around the current price levels (1.1220-1.1235).

Initial Target level to be located around 1.1320. Stop loss should be placed below 1.1190.

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

June 6, 2019 : GBP/USD Intraday technical analysis and trade recommendations.

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On March 29, a visit towards the price levels of 1.2980 (the lower limit of the newly-established bearish movement channel) could bring the GBPUSD pair again towards the upper limit of the minor bearish channel around (1.3160-1.3180).

Since then, Short-term outlook has turned into bearish with intermediate-term bearish targets projected towards 1.2900 and 1.2850.

On April 26, another bullish pullback was initiated towards the price zone of 1.3130-1.3170 where the depicted bearish Head and Shoulders reversal pattern was demonstrated on the H4 chart with neckline located around 1.2980-1.3020.

Hence, Bearish breakdown below 1.2980 allowed the recent significant bearish movement to occur.

Initial bearish Targets were already reached around 1.2900-1.2870 (the backside of the broken channel) which failed to provide any bullish support for the GBPUSD pair.

Further bearish decline was demonstrated towards the lower limit of the long-term channel around (1.2700-1.2650) where the GBPUSD pair looked oversold obviously.

That's why conservative traders were suggested NOT to consider any SELL signals around those low price levels.

As anticipated, bullish breakout above 1.2650 has already been achieved. This enhanced the bullish side of the market towards 1.2750 which prevented further bullish advancement Yesterday.

For the bulls to remain dominant, another bullish breakout above 1.2750 is needed to extend potential bullish targets towards 1.2800 then 1.2890 if sufficient bullish momentum is demonstrated.

Otherwise, the GBPUSD would have another bearish visit towards 1.2650 where a better BUY entry will probably be offered (demonstrating a bullish Head & Shoulders reversal pattern).

Trade Recommendations:

For Intraday traders, bearish pullback towards 1.2650 will probably offer a valid BUY entry. T/P level to be located around 1.2720 and 1.2820. S/L should be placed below 1.2590.

Conservative traders should wait for an extensive bullish movement towards 1.2870-1.2905 (newly-established supply zone) to look for valid sell entries. S/L should be placed above 1.2950.

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

EUR/USD approaching support, potential bounce!

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Price is approaching our first support where we might be seeing a bounce above this level.

Entry : 1.1213

Why it's good : Horizontal pullback support, 50% Fibonacci retracement, 100% Fibonacci extension, short term ascending support line

Stop Loss : 1.1180

Why it's good : 61.8% Fibonacci retracement

Take Profit : 1.1255

Why it's good : 50% Fibonacci retracement, 61.8% Fibonacci extension

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NZD/USD approaching support, potential bounce!

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Price is approaching support where it is expected to bounce to its resistance. We are expected some NZD strength later today due to risk-on sentiment back in the market..

Entry : 0.6603

Why it's good : 38.2% Fibonacci retracement, 100% Fibonacci extension, horizontal pullback resistance

Stop Loss : 0.6561

Why it's good : 61.8% Fibonacci retracement, horizontal pullback support

Take Profit : 0.6667

Why it's good : Horizontal swing low support, 38.2% Fibonacci retracement

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

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

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

Entry: 121.32

Why it's good : 61.8% Fibonacci extension, 61.8% Fibonacci retracement, horizontal overlap resistance

Stop Loss : 122.24

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

Take Profit : 120.79

Why it's good: 76.4% Fibonacci retracement, 100% Fibonacci extension, horizontal swing low support

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

Powell did not make Armageddon, but what Draghi will say on Thursday

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No matter which way, but it seems that Donald Trump has achieved his goal. Long resisted by Jerome, Powell saw the need for a rate cut. Members of the Federal Reserve are closely watching the recent escalation of trade friction and will react if the economic situation in the country deteriorates, the head of the regulator said. Market participants perceived his words as a "dovish" signal. The S&P 500 jumped more than 2%, and the dollar has been in a state of weightlessness for the fifth day in a row. On Wednesday, the US currency continued its free fall relative to its six main competitors.

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At the same time, a month ago, CME derivatives issued only a 32 percent probability of easing policy at the September FOMC meeting. Expectations soared to 86%, after the White House owner announced new tariffs against China and Mexico, and Powell dropped the standard mention that the bank was "patient" in terms of interest rates. The July figure jumped to 50% from 18.5% previously.

Market participants are waiting for a three-fold reduction in rates in the second half of the year. Analysts at Barclays expect that the central bank will twice soften the policy - in the autumn by 50 b.p. and in the winter at 25 b.p. A similar opinion is held in JP Morgan. It is worth noting that not so long ago, both banks did not predict any changes in monetary policy until the end of 2020.

If you turn to yesterday's comments of Powell, then you can be sure that he did not directly mention the rate cut, but only made it clear that the Fed is vigilant. In fact, he agitated the markets and reinforced the confidence of traders in easing the policy of the head of the Federal Reserve Bank of St. Louis, James Bullard. However, one should not forget that this official adheres to a "dovish" position; he had not hesitated to say that the Federal Reserve had gone too far with tightening policies in December. President of the Federal Reserve Bank of Dallas, Robert Kaplan wants to see whether some of the recent developments in the field of trade wars will be canceled, and his colleague from Chicago, Charles Evans, feels great at the current level of the federal funds rate. It is not excluded that the derivatives market runs ahead of the locomotive, since it firmly believes in easing the policy.

About the euro

As for the dynamics of the EUR/USD pair, it now looks better than it owes to the weakened dollar. The long-term strengthening of the euro can be expected after the cessation of trade friction. While Trump is going to war against everyone, you can safely buy the yen, the franc and gold. Moreover, the World Bank is constantly reducing forecasts for the growth of the global economy. Today, the estimate for the current year was worsened from 2.9% to 2.6%.

The main pair tested the resistance of $1.1265 and briefly rose slightly above the round mark of $1.13. It is unlikely that it will possibly develop an upward movement, because after the Fed the "dovish" motives will start to play around the European Central Bank. Euro positions may suffer significantly if Mario Draghi announces new incentive measures on Thursday.

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The market, despite the deterioration of statistics, trade wars and consumption stagnation, does not expect any global changes in the area of monetary policy. Moreover, it is believed that the ECB will want to strengthen the position of the recently suffering euro.

Of particular interest will be the updated macroeconomic forecasts and the way Mario Draghi assesses the current state of the eurozone economy. At the next meetings of the regulator, the details of the new bank lending program (TLTRO) may be made public. Perhaps this will happen on Thursday.

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Britain's exit from the EU threatens to turn around for the next prime minister of the country "shot in the foot"

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The GBP/USD pair keeps a positive attitude and is trading near weekly highs at 1.2720 against the background of easing pressure from the dollar and the release of strong UK statistics.

The May release on PMI was published today. It is a key release for the British economy in the services sector. The indicator unexpectedly showed an increase from 50.4 to 51.0 points.

In addition, the pound was supported by a statement by the President of the United States, Donald Trump, on the intention to conclude a trade deal with the UK immediately after it left the EU.

However, it is not yet clear whether the GBP/USD pair will be able to continue to grow against the background of continuing political uncertainty in the United Kingdom.

"Now there is not just a deadline on October 31. It is also the election of the leader of the Conservative party, and large-scale uncertainty about the direction of the country's movement in the context of Brexit," - said Marvin Barth, currency strategist Barclays.

For investors in the British currency, there are three key factors that require close attention:

1. Conservatives. In the past, the main contenders for the post of Tory head often lost the race, and this time the number of candidates exceeds ten people. If former British Foreign Secretary Boris Johnson reaches the final stage, he is guaranteed victory. According to experts, his direct charm and good sense of humor seem to be more important for members of the Conservative Party than administrative abilities. In the event that Johnson does not win, several more hard Brexit supporters take part in the race. Investors fear that the country's withdrawal from the EU will turn into a "shot in the foot" for the next prime minister.

2. House of Commons. Lawmakers so far hopelessly disagree on Brexit. There is only one consensus: they do not approve the withdrawal of the United Kingdom from the EU without a deal.

3. European Union. The Alliance can not stop the UK, which is heading for an exit, but repeatedly reiterated that it would not revise the current terms of the deal, which the British MPs rejected. However, the EU has its own problems: it will have to choose a new leadership, therefore, if London offers something new, it will be possible to resume negotiations.

It is assumed that in the event of an implementation of the "hard" scenario, the pound sterling will collapse, some analysts even talking about achieving parity with the dollar. However, if Brexit is canceled, the British currency will soar and reach the mark of $ 1.50, fixed before the 2016 referendum.

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What to expect from the upcoming ECB meeting and what will happen to the euro?

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The focus of attention this week is the next meeting of the European Central Bank (ECB), which will take place tomorrow.

Amid growing concerns about the global economic slowdown due to the US-China trade war, investors have no choice but to wait for new signals from the ECB for a weaker monetary course, as well as details about the next round of long-term lending to banks (TLTRO), which starts in September .

If the regulator wants to maintain market confidence, it must make it clear that it is considering the possibility of taking more decisive actions, such as a new round of quantitative easing (QE), reports Bloomberg.

"The ECB needs to be proactive against the background of the policy easing expected by the market. This effect can hardly be achieved only by announcing the TLTRO parameters or by changing the interest rate forecast. The signal must be strong and unexpected. That could be a hint that the QE program will be resumed, "said Citigroup representatives.

Will the regulator surprise the market and how will the euro react to the central bank's statements?

"The risk/reward ratio tends to react to the market in favor of a stronger euro. Apparently, the conditions of TLTRO-III will be less attractive than TLTRO-II. We doubt that the regulator will open the door to a greater reduction in rates compared to what it did in April," said currency strategists at Nordea Bank.

"The euro may extend its recent recovery, as the Governing Council of the ECB does not seem inclined to offer overly generous TLTRO. In addition, the idea of a multi-level deposit rate does not yet find a common understanding in the management of the central bank," Credit Agricole believes.

"It seems that the market expects too much from the regulator. It is likely that, following the next meeting, the ECB's tone might not seem dovish. In this case, we could see a sharp jump in the euro, "said Rabobank experts.

"The euro will continue to be in demand among investors, given that at the upcoming meeting, the ECB does not move the expected interest rate increase in the first half of 2020 to a later date and also does not raise the volume of the TLTRO-III incentive program above 720 billion euros," analysts at Morgan Stanley say.

They predict that in the short term the EUR/USD pair will test the strength of the level of 1.1310.

"Breaking through this level will open the way to impressive growth. At the same time, potential attempts to strengthen the dollar against the euro are likely to be limited to 1.1120," the experts said.

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The Fed is more likely to lower rates, the dollar is ready for this

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The rise of the dollar was expectedly stopped by the Fed. The currency has updated the seven-week low against the backdrop of rising expectations of interest rate cuts in response to the risks associated with trade conflicts. Fed Chairman Jerome Powell did not make hints, and specifically promised that the regulator will respond "appropriately" to trade pressure. The statement immediately affected the US currency, the markets have already begun to prepare for a reduction in the Fed rate. However, given the change in the Fed's forecast and the collapse in the yield of US Treasury bonds in recent weeks, the loss of the dollar in this context looks rather subdued. If global growth worsens, the dollar will go up again.

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On Thursday, the ECB will begin its meeting, and there is a high probability that the attitude of the ECB will correspond to the "dovish" tone of the Fed, and perhaps the regulator will even announce more free conditions for a new scheme of cheap lending. Concerns about a recession are spreading throughout the world, and central banks have cut interest rates in recent weeks, which may signal the beginning of a global monetary easing cycle. On Tuesday, the Reserve Bank of Australia lowered its base interest rates to a record low of 1.25% and made it clear that they were ready to go further if the situation did not change. Last month, the Central Bank of New Zealand for the first time in the last 2.5 years lowered its base interest rate, trying to support the economy. Against this background, the euro is growing as well as the Australian and New Zealand dollars.

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