Indicator analysis. Daily review on September 24, 2019 for the GBP / USD currency pair.

Trend analysis (Fig. 1).

On Tuesday, the price may continue to move down to a pullback level of 38.2% - 1.2344 (blue dotted line). In case of breaking through this level, the continuation of the downward movement to the pullback level of 50.0% - 1.2270 (blue dashed line) is possible.

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Fig. 1 (daily chart).

Comprehensive analysis:

- indicator analysis - down;

- Fibonacci levels - down;

- volumes - down;

- candlestick analysis - down;

- trend analysis - up;

- Bollinger Lines - down;

- weekly schedule - up.

General conclusion:

On Tuesday, the price may continue to move down.

The upward movement with the target of 1.2503, the pullback level of 38.2% (red dashed line) may begin after the news is released at 14.00 Universal time.

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Indicator analysis. Daily review on September 24, 2019 for the EUR / USD currency pair

Trend analysis (Fig. 1).

On Tuesday, a downward movement is possible.

analytics5d89a5738597f.png

Fig. 1 (daily chart).

Comprehensive analysis:

- indicator analysis - down;

- Fibonacci levels - up;

- volumes - down;

- candlestick analysis - neutral;

- trend analysis - down;

- Bollinger Lines - down;

- weekly schedule - up.

General conclusion:

On Tuesday, a downward movement is possible, but a lot will depend on the news, which is the preliminary top.

The first lower target is 1.0967 - the lower fractal (red dashed line).

The first upper target is 1.1022 - a pullback level of 38.2% (red dashed line).

Until 8.00 Universal time (news) lower work.

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

GBP/USD: plan for the European session on September 23. The pound is still trading in the channel after yesterday's decline

To open long positions on GBP/USD you need:

From a technical point of view, the situation has not changed in the face of low volatility due to the lack of reference points for Brexit. Bulls also act with caution. Their task in the first half of the day is to return to the resistance of 1.2460, from which we can again expect a second jump to the area of a high of 1.2522, where I recommend taking profits. If the pressure on the pound continues, I advise you to return to long positions only for a rebound from the major support at 1.2393, since a sufficiently large number of buy orders were concentrated there last week. In a scenario of breakdown of the low of 1.2393, it is best to buy the pound from 1.2323.

To open short positions on GBP/USD you need:

Bears have to defend the level of 1.2460, which now acts as a resistance. A good report on the balance of industrial orders according to the confederation of British industrialists and the formation of a false breakdown in this range will be a clear signal for opening new short positions in the hope of updating major support at 1.2393, where I recommend taking profits today. A further target for sellers this week will be a low of 1.2323. If the bulls return to the market and "win back" the level of 1.2460, it is best to consider new short positions by a rebound from the high of 1.2522.

Signals of indicators:

Moving averages

Trading is below 30 and 50 moving averages, indicating a slight advantage to pound sellers.

Bollinger bands

Volatility has greatly decreased, which does not provide signals for entering the market.

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Description of indicators

  • MA (moving average) 50 days - yellow
  • MA (moving average) 30 days - green
  • MACD: Fast EMA 12, Slow EMA 26, SMA 9
  • Bollinger Bands 20
The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis of ETH/USD for 24/09/2019

Crypto Industry News:

Kyrgyzstan cut off the power to 45 cryptocurrency mining companies because they consumed more energy than a total of three local regions. Senior Energy Officer Aitmamat Nazarov warned that mining cryptocurrencies are not defined by Kyrgyz law, according to a local news agency.

According to Nazarov, 45 cryptocurrency miners consumed 136 megawatts of electricity, which is more than the amount consumed by three Kyrgyzstan regions: Issyk-Kul, Talas and Naryn. Kyrgyzstan has become a popular destination for global mining companies due to low energy prices.

In August, the country's Ministry of Economy submitted a bill to introduce taxation on cryptocurrency mining - a move to increase revenues. Cryptocurrencies were banned in Kyrgyzstan in July 2014 after a national bank warned that using Bitcoin and other cryptocurrencies as a payment method is illegal.

Iran, which also cuts off electricity to local mining companies, has proposed the annual registration of cryptographic miners to regulate the industry.

Technical Market Overview:

The ETH/USD pair has hit the level of $200.17 which is the 38% Fibonacci retracement of the last wave up. The whole corrective cycle looks completed as there are visible three waves ABC, but in the case of another wave down the next target for bears is seen at the level of $196.61. Please notice, that after the corrective cycle in wave 4 is completed, there is still wave 5 to the upside needed to complete the overall impulsive cycle up.

Weekly Pivot Points:

WR3 - $261.09

WR2 - $242.26

WR1 - $225.12

Weekly Pivot - $205.85

WS1 - $188.31

WS2 - $169.05

WS3 - $152.55

Trading recommendations:

The best strategy in the current market conditions is to trade with the larger timeframe trend, which is still up. All the shorter timeframe moves are being treated as a correction inside of the uptrend. The current cycle is wave 2 of the lower wave degree and it might have been completed, so the uptrend should resume soon. The global investors are waiting for a breakout above the level of $202.59 and $238.68 to confirm the resumption of the uptrend.

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EUR/USD: plan for the European session on September 24. Now it is the bears' turn to defend the 1.0997 level

To open long positions on EURUSD you need:

As I noted yesterday, the weak manufacturing activity index in the eurozone countries caused the euro to fall to a support level of 1.0997, which now acts as a resistance. If today the report on business confidence indicates growth, then it is likely that EUR/USD buyers will attempt to return and consolidate above the range of 1.0997, which will lead to the demolition of a number of stop orders and an upward correction of the pair in the resistance area of 1.1034, where I recommend taking profit. In the event of a weak report, which is quite possible, given the current state of the German economy, the bulls only have to rely on a false breakdown in the support area of 1.0960, and recommend opening long positions immediately for a rebound at the low of the month in the area of 1.0927.

To open short positions on EURUSD you need:

Euro sellers will rely on a weak report on confidence in business circles, which will maintain a downward potential in EUR/USD, and a break of support of 1.0960 will only increase the pressure on the pair, which will lead to an update of the low at 1.0927, where I recommend taking profits. If the data turns out to be worse than economists' forecasts, the bulls can take advantage of this and return to a resistance of 1.0997, from where I recommend to open short positions subject to the formation of a false breakdown. Selling the euro for a rebound is best done from a larger resistance of 1.1034.

Signals of indicators:

Moving averages

Trading is conducted below 30 and 50 moving averages, which indicates an advantage for sellers of the euro.

Bollinger bands

A break of the lower boundary of the indicator in the region of 1.0985 will raise the pressure on the euro, while going beyond the upper boundary in the region of 1.1000 will lead to an increase in the pair.

analytics5d89b29705053.png

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

Technical analysis of BTC/USD for 24/09/2019

Crypto Industry News:

Bitwise Asset Management has presented another presentation of the US Securities and Exchange Commission (SEC) in its offer regarding the regulatory approval of the proposed Bitcoin ETF.

In the issued memorandum, the SEC published a Bitwise presentation explaining why, in its view, the regulator's concerns were largely resolved. The presentation began with a summary of the evolution and improvement of the market situation over the last two years.

First, the spot market has become more efficient, with the average Bitcoin price deviation on the ten largest exchanges decreasing. Although it was just below 1% in December 2017, it has now fallen further to below 0.1%.

In addition, many new institutional-grade Bitcoin trust services are emerging, receiving licenses from local jurisdictions to manage and store Bitcoins for clients. Meanwhile, record-breaking volumes of Bitcoin futures contracts on the Chicago Mercantile Exchange have been reported this year, suggesting that the regulated futures market is currently significant.

Technical Market Overview:

The BTC/USD pair has tested the technical support and the low for the wave (2) located at the level of $9,539 again. The recent local high was made at the level of $10,317 after previous bounce from the level of $9,539 but since then the bears are pushing the market lower again. In case of a breakout lower, the next target for bears is seen at the level of $9,288 - $9,263 zone. No important breakout occured so far and the larger time-frame trend remains up.

Weekly Pivot Points:

WR3 - $11,109

WR2 - $10,706

WR1 - $10,333

Weekly Pivot - $9,939

WS1 - $9,560

WS2 - $9,159

WS3 - $8,757

Trading recommendations:

The best strategy in the current market conditions is to trade with the larger timeframe trend, which is still up. All the shorter timeframe moves are being treated as a correction inside of the uptrend. The wave 2 corrective cycles are about to be completed and the market might be ready for another impulsive wave up of a higher degree. Any violation of the level of $9,231 invalidates the bullish impulsive scenario.

analytics5d89afcfc0638.jpg

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Overview of GBP/USD on September 24th. Forecast according to the "Regression Channels". Today, the Supreme Court will make

4-hour timeframe

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Technical data:

The upper channel of linear regression: direction – down.

The lower channel of linear regression: direction – up.

The moving average (20; smoothed) – sideways.

CCI: -110.0115

Last week, we repeatedly said that the Scottish Court found the actions of Boris Johnson to suspend the work of Parliament illegal, but did not issue any order. The judges of Edinburgh ruled that Boris Johnson had two motives for prorogation: 1) to prevent Parliament from holding the executive branch accountable and passing Brexit laws; 2) to allow the executive branch to hold Brexit without a "deal" without interference from Parliament. Throughout the past week, the UK Supreme Court has been hearing the same case and is finally due to reach a verdict today. Either he admits that Boris Johnson broke the law when he sent parliamentarians on vacation for 5 weeks, or he will rule otherwise. In the first case, Boris Johnson can safely count a new defeat, and the deputies will return to their duties. In the second case, nothing will change, the Parliament will not work until October 14, and the topic with Brexit will hang in the air for several more weeks, because after all the events of the first week of September, when the Parliament nevertheless passed a law banning Johnson from implementing "hard" Brexit, it remains unclear whether the Prime Minister intends to follow this law? The Court's decision is expected at 10:30 am local time.

Meanwhile, according to many publications, Donald Trump and Boris Johnson have agreed to make a big trade deal. It is expected that the agreement will be signed before July 2020, and will come into force no earlier than December 2020, when "the transition period after the implementation of Brexit will end." Interestingly, who said that the transition period will end before December 2020? And who said Brexit itself would be implemented before then? As many experts note, initially Boris Johnson was skeptical about the possibility of concluding a trade deal in 9 months, but afterward, he changed his mind, since the presidential election in the USA is a high risk of a change of president, and it may not be possible to agree with a new US leader. It's hard to tell if a trade deal with the States is good news or not. While no one knows what conditions will be spelled out in this agreement, what are the rights and obligations of the parties? Given Trump's trade claims against China and the European Union, there is a reason to assume that the deal will primarily be in favor of the United States. Will it benefit the UK?

But the trade deal is interesting and the pound is still influenced by the Brexit theme. September ends in a week, and the country must either leave the EU under the "hard" scenario or sign an agreement or postpone Brexit in October. It is still unclear which option will be implemented, but in recent days, traders' optimism about postponing the release date to January 2020 and/or signing a "deal" with Brussels has fallen. Today, no macroeconomic reports are expected from the UK, and the technical picture allows for the continuation of the downward movement, as there are no signs of an upward correction at the moment.

Nearest support levels:

S1 – 1.2421

S2 – 1.2390

S3 – 1.2360

Nearest resistance levels:

R1 – 1.2451

R2 – 1.2482

R3 – 1.2512

Trading recommendations:

The GBP/USD pair moved downwards. Thus, traders are recommended to trade downwards with the targets of 1.2390 and 1.2360, before the reversal of the Heiken Ashi indicator upwards. The decision of the Supreme Court, which will be announced this morning, may affect the mood of traders.

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

Explanation of illustrations:

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

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

CCI – the blue line in the indicator regression window.

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

Support and resistance – red horizontal lines.

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

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

Technical analysis of GBPUSD for 24/09/2019

Technical Market Overview:

The GBP/USD pair continues the corrective move down. The bears might soon start to push the prices lower again and the key level for them is the technical support located at 1.2381 because the momentum is below the fifty levels already. Any violation of this level will be a clear sign that the correction has started. Please notice the Bearish Engulfing pattern at the top of the recent move up as it might be the first clue that the correction has started already.

Weekly Pivot Points:

WR3 - 1.2753

WR2 - 1.2662

WR1 - 1.2561

Weekly Pivot - 1.2479

WS1 - 1.2378

WS2 - 1.2291

WS3 - 1.2188

Trading recommendations:

The best strategy for current market conditions is to trade with the larger timeframe trend, which is down. All upward moves will be treated as local corrections in the downtrend. In order to reverse the trend from down to up, the key level for bulls is seen at 1.2505 and it must be clearly violated. As long as the price is trading below this level, the downtrend continues towards the level of 1.2000 and below.

analytics5d89ae3b360ef.jpg

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Technical analysis of EUR/USD for 24/09/2019

Technical Market Overview:

The big Bullish Engulfing candlestick pattern made after the ECB decision to cut the interest rates is still in the background of the short-term EUR/USD timeframe chart and this is a powerful trend reversal pattern. The last important Fibonacci retracement has been violated and the price has made another lower low at the level of 1.0965, just above the technical support located at the level of 1.0963. The key technical support is located at the level of 1.0926 and if violated, then the impulsive wave scenario will be invalidated.

Weekly Pivot Points:

WR3 - 1.1151

WR2 - 1.1121

WR1 - 1.1056

Weekly Pivot - 1.1026

WS1 - 1.0965

WS2 - 1.0930

WS3 - 1.0867

Trading recommendations:

The best strategy for current market conditions is to trade with the larger timeframe trend, which is down. All upward moves will be treated as local corrections in the downtrend. The downtrend is valid as long as it is terminated or the level of 1.1445 clearly violated. There is an Ending Diagonal price pattern visible on the larget timeframes that indicate a possible downtrend termination soon. The key short-term levels are technical support at the level of 1.0926 and the technical resistance at the level of 1.1267.

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Overview of EUR/USD on September 24th. Forecast according to the "Regression Channels". Eurozone economy: no signs of recovery

4-hour timeframe

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Technical data:

The upper channel of linear regression: direction – down.

The lower channel of linear regression: direction – down.

The moving average (20; smoothed) – down.

CCI: -117.4390

Yesterday can be called a failure for the euro. We already wrote in yesterday's article about the indices of business activity in the European Union and Germany, which all, as one, failed. It remains only to mention the speech of ECB President Mario Draghi before the European Parliament. We have repeatedly said that even for Draghi's neutral rhetoric, there are no fundamental factors. Therefore, each speech of the ECB Chairman potentially carries a danger to the euro. That's what happened yesterday. Mario Draghi's speech was ultra-soft. He said that European macroeconomic indicators have slowed more than expected, that there are no signs of economic recovery, low inflation remains a headache for the ECB. In this regard, the regulator will continue to "keep abreast" with the willingness to further soften monetary policy. Draghi also noted that "the longer the recession persists in the industry, the higher the probability that the "crisis" will affect other areas." The European currency paired with the US dollar only miraculously did not react to these words, as well as no stronger than expected business activity indices in the sphere of production and services of the United States. In general, Draghi did not surprise the markets, he only said that there are no positive changes. Now, for a new rate cut, Draghi has only one chance – the October meeting of the regulator, after which the head of the ECB will transfer his powers to Christine Lagarde and resign.

Tuesday, September 24th, will be a calmer day than Monday. At least, the euro would like to hope so. Today, no important macroeconomic publications are planned in the European Union, and only the level of consumer confidence will be released in the States. However, yesterday, traders received a "charge" for the whole week and today, they can calmly continue to get rid of the euro. Ghostly chances that the pair will still form an upward trend in the near future remain. Still, the pattern of "double bottom" has not yet been canceled, but now every trader can personally observe the continuous flow of negativity from the eurozone. In favor of the further fall of the euro/dollar pair, both channels of linear regression speak, which are directed downward, indicating a downward trend in the medium and long term, as well as the fact that each subsequent maximum is lower than the previous one. In general, the euro is still balancing on the brink of the abyss and, perhaps, only the reluctance of bears to rush into battle with new forces around the two-year lows of the pair, somehow still restrains the currency pair from new falls. Based on the current technical picture, it follows that the "bearish" mood remains in the forex market, and there are very few chances for the formation of an upward trend now.

Nearest support levels:

S1 – 1.0986

S2 – 1.0956

S3 – 1.0925

Nearest resistance levels:

R1 – 1.1017

R2 – 1.1047

R3 – 1.1078

Trading recommendations:

The euro/dollar pair consolidated below the moving average and worked out Murray's level of "1/8" - 1.0986. Thus, we recommend resuming trading on the fall with the targets of 1.0986, 1.0956 and 1.0925, after the reversal of the Heiken Ashi indicator down. Eurocurrency purchases are currently not recommended.

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

Explanation of illustrations:

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

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

CCI – the blue line in the indicator window.

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

Support and resistance – red horizontal lines.

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

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

Elliott wave analysis of GBP/JPY for September 24 - 2019

analytics5d899f9e329e5.png

GBP/JPY continues to move lower as expected and the break below key support at 133.83 confirms more downside pressure towards 132.16 and ideally closer to our ideal target at 130.78 to complete a complex expanding correction as red wave ii.

Once this expanded correction is complete a new impulsive rally higher to 139.27 will be expected and in the longer term, it is likely to push higher.

R3: 134.28

R2: 134.04

R1: 133.90

Pivot: 133.56

S1: 133.30

S2: 133.16

S3: 132.89

Trading recommendation:

We are looking for a buy-opportunity near 131.25.

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Elliott wave analysis of EUR/JPY for September 24 - 2019

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The failure to rally from 118.41 is concerning, but as long as key-support at 117.54 stays intact we will keep our bullish expectations for a new impulsive rally towards at least 121.97. In the short-term, a break above minor resistance at 118.79 will be the first strong indication that the next impulsive rally higher is developing.

Should an unexpected break below key-support at 117.54 be seen, it will tell us, that a much more complex wave ii has been developing and a dip to 117.15 is expected before turning higher again.

R3: 118.72

R2: 118.53

R1: 118.35

Pivot: 118.07

S1: 117.72

S2: 117.54

S3: 117.15

Trading recommendation:

We are long EUR from 118.25 with our stop placed at 117.50. If our stop is taken out, we will re-buy EUR at 117.25.

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

Technical analysis: Important Intraday Levels For EUR/USD, September 24, 2019

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When the European market opens, some economic data will be released such as Belgian NBB Business Climate and German Ifo Business Climate. The US will also publish the economic data such as Richmond Manufacturing Index, CB Consumer Confidence, S&P/CS Composite-20 HPI y/y, and HPI m/m, so amid the reports, the EUR/USD pair will move with low to medium volatility during this day. TODAY'S TECHNICAL LEVELS: Breakout BUY Level: 1.1046. Strong Resistance: 1.1040. Original Resistance: 1.1029. Inner Sell Area: 1.1018. Target Inner Area: 1.0993. Inner Buy Area: 1.0968. Original Support: 1.0957. Strong Support: 1.10946. Breakout SELL Level: 1.0940. (Disclaimer)The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis: Important Intraday Levels for USD/JPY, September 24, 2019

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In Asia, Japan will not release any economic reports today, but the US will release publish some economic data such as Richmond Manufacturing Index, CB Consumer Confidence, S&P/CS Composite-20 HPI y/y, and HPI m/m. So there is a probability the USD/JPY pair will move with low to medium volatility during this day. TODAY'S TECHNICAL LEVELS: Resistance. 3: 108.19. Resistance. 2: 107.98. Resistance. 1: 107.77. Support. 1: 107.51. Support. 2: 107.30. Support. 3: 107.09. (Disclaimer)The material has been provided by InstaForex Company - www.instaforex.com

NZD / USD: New Zealander in anticipation of the "sentence" of the RBNZ, will the July scenario be repeated?

At the end of last week, the New Zealand dollar paired with the US currency updated again its multi-year low and reached 0.6250, which was last seen in 2015. It is when the pair sank to the base of the 61st figure. To date, there is every reason to believe that the NZD/USD bears will push the price to the indicated levels, especially if tomorrow's RBNZ meeting will not be in favor of the Kiwi.

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According to experts, the New Zealand regulator will leave the interest rate unchanged at 1% during the September meeting. Although, the market discussed at the end of August during (September 25 and November 13) the prospects for further rate cuts at one of the meetings remaining this year. Most traders are still confident that the RBNZ will resort to another round of monetary easing, ending the year with a rate of 0.75%. The only question is whether the regulator will surprise traders at tomorrow's meeting or whether they will prepare the markets for this step in advance.

Let me remind you that the RBNZ shocked the markets at the July meeting with a sudden decrease in interest rates by 50 basis points at once. At the same time, on the eve of the meeting of regulator members, quite strong data on the labor market in New Zealand were published, particularly the unemployment rate in the second quarter unexpectedly dropped from 4.2% to a record low of 3.9%. However, the Central Bank not only lowered the rate but also announced further steps in this direction. Moreover, the head of the Central Bank, Adrian Orr, did not rule out a reduction in the key interest rate in the negative region to -0.35%. According to him, the regulator implements this scenario without a shadow of doubt in the event of a crisis. At the same time, he added that asset purchases are "a less attractive policy mitigation tool" for him. In other words, Orr made it clear that he would not follow the path of his many colleagues, eliminating the use of QE. Nevertheless, he expressed his readiness to actively reduce the rate, including in the area of negative territory.

In my opinion, the Reserve Bank of New Zealand will take a wait and see attitude tomorrow but may hint at further actions in November. Given the latest foreign policy events and macroeconomic reports, such a scenario is most likely. New Zealand GDP growth data released on September 19 came out at a forecasted level, confirming a slowdown in the national economy. Therefore, the indicator grew to only 2.1% in the second quarter (in annual terms) and by 0.5% in quarterly terms. Thus, the growth of the New Zealand economy has slowed to its lowest level over the past five years, reflecting the effects of the global trade conflict. The nation reacts most sharply to the events of recent months, considering that China is the country's main and largest export market. Moreover, the general deterioration of the investment climate has affected other areas, such as the housing market and business confidence.

analytics5d898fe514234.jpg

Thus, the latest data on the growth of the New Zealand economy has retained the likelihood of further interest rate cuts. The external fundamental background is also not pleasing with the latest events in Saudi Arabia as another source of geopolitical uncertainty. In turn, the United States and China are only just preparing to sit (once again) at the negotiating table. We will learn about the results of the meeting in early October if any "careless steps" do not disrupt the negotiation process. To date, the parties are taking friendly steps, demonstrating a willingness to dialogue but traders are wary of such situations with certain caution. Over the past year and a half, Beijing and Washington have been a few steps from signing a deal but everyone knows the final result.

Summarizing the above, recalling again that according to the general expectations of the market, the RBNZ will maintain the status quo tomorrow and keep the rate at a one percent level. At the same time, the regulator may announce further steps to reduce rates at its last meeting this year. This fact will put background pressure on the New Zealand dollar. If the Central Bank resorts to lower rates tomorrow, the July story of the NZD/USD pair will repeat when it impulse and lost hundreds of points.

From a technical point of view, the pair is under significant pressure and on all the "senior" timeframes. On H4, D1, W1, and MN timeframes, the pair is between the middle and lower lines of the Bollinger Bands indicator, which also indicates the priority of the southern movement. The pair shows a pronounced bearish trend, which is confirmed by the main trend indicators - Bollinger Bands and Ichimoku. Hence, the Ichimoku indicator formed its strongest bearish signal "Parade of Lines" on the daily chart. All the indicator lines are above the price chart, thereby demonstrating pressure on the pair.

In turn, the lines of the Bollinger Bands indicator on the daily chart shows a narrowed channel, and this also gives a strong signal for the downward direction. Additional confirmation of the bearish scenario is the oversold MACD and Stochastic oscillators. To determine the main goal of the downward movement, let's move on to the monthly timeframe. Here, we focus on the lower line of Bollinger Bands at the price of 0.6220.

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Forecast for EUR/USD on September 24, 2019

EUR/USD

On Monday, the euro market suffered a double disappointment: the index of business activity in the manufacturing sector of the eurozone fell from 47.0 points to 45.6 in September, activity in the service sector fell from 53.5 to 52.0. In the evening, the head of the ECB, Mario Draghi, speaking in the European Parliament with a quarterly report, announced the ongoing production decline, which is pulling down other economic sectors.

Today, President Donald Trump speaks at the UN General Assembly. He can be extremely harsh on Iran, which will strengthen the position of the dollar.

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On the daily chart, the price pierced the Fibonacci level of 138.2%, the signal line of the Marlin oscillator moved into the declining trend zone. Now, the immediate goal of 1.0926 opens before the price - the lows of September 12 and 3, after which we are waiting for the price at the Fibonacci level of 161.8% (1.0845).

analytics5d89a5f63ea43.png

On a four-hour chart, the price is developing under the lines of balance and MACD, the MACD line itself - an indicator of the trend direction, turns down. Marlin is in the zone of negative values. The trend is completely decreasing.

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Forecast for GBP/USD on September 24, 2019

GBP/USD

The British pound showed a steady decline for two consecutive days - on Friday and Monday, falling during this time at the opening and closing points by 90 points. The last time a similar downward trend was in the last days of August, then the pound lost more than three hundred points. But now the pound is even higher, respectively, under favorable external circumstances, the fall may be even greater. Reasons for this are already appearing. England's Supreme Court intends to consider the alleged deception by Boris Johnson of the Queen of Great Britain in the "raw data" on Brexit, because of which she endorsed the suspension of Parliament from work for a month. Also today, the index of industrial orders for the current month will be released - the forecast is -14 against -13 in August. Net public sector borrowing for August is expected to rise from -2.0 billion pounds to 6.5 billion, which may be the highest value in the last 9 months.

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In the main scenario, we are waiting for the price to overcome the signal level of 1.2381 (July 17 low), then drop to the Fibonacci level of 223.6% at the price of 1.2230. The divergence in the Marlin oscillator, which we determined in the previous review, turned out to be effective.

On a four-hour chart, the price has consolidated under the lines of balance and MACD, Marlin is declining in the territory of the "bears".

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Forecast for USD / JPY pair on September 24, 2019

USD / JPY pair

The pair is falling on the background of political risks for the fourth day. Investors bought the yen against the dollar on traditional ideas about the yen as a safe haven currency but stock markets are growing on both sides of the hemisphere. This could change investor sentiment and the dollar will continue to grow again. On the daily chart, the price did not reach the support of the green line of the price channel but this is not a prerequisite for a reversal yesterday. In general, the price is in a growing position, according to all indicators. A reversal with subsequent growth to the nearest target 108.26 may occur today from current levels. The price exit above 108.26 opens the second target to 109.10, which is the resistance of the subsequent embedded line of the price channel.

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On the four-hour chart, the price is still in a downward position on all indicators, including the leading Marlin oscillator. Therefore, even if the growth option is the priority, it should be treated with caution. A signal of growth will be the price exit above the MACD line at the level of 108.10, where it is now more than 50 points. Past 15 points above will already be the first goal, from which a downward correction is not excluded. In the event of any other disturbing geopolitical news, the development of a "bearish" target 107.22 is possible. There may be some departure of the price to move lower without fixing below it on a daily scale. Fixing of the price starts a lowering scenario with the target of 106.50, which is the MACD line on daily.

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#USDX vs EUR / USD vs GBP / USD vs USD / JPY. Comprehensive analysis of movement options from September 24, 2019 APLs &

Let us consider, in a comprehensive manner, how the development of the movement of currency instruments #USDX, EUR / USD, GBP / USD and USD / JPY will begin from September 24, 2019.

Minuette (H4 time frame)

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US dollar index

The development of the #USDX dollar index movement from September 24, 2019 will be due to the development and direction of the breakdown of the boundaries of the 1/2 Median Line channel (98.95 - 98.75 - 98.53) of the Minuette operational scale fork. The movement marking inside this channel is shown in the animated chart.

If the upper boundary of the 1/2 Median Line channel (resistance level of 98.95) of the Minuette operational scale fork is broken, it will be possible to continue the development of the upward movement of the dollar index to the targets - warning line UWL38.2 Minuette (99.30) - maximum 99.37 - control line UTL Minuette (99.65).

The breakdown of the lower boundary of the 1/2 Median Line Minuette channel (support level of 98.53), in turn, will direct the development of the #USDX movement to the boundaries of the 1/2 Median Line Minuette channel (98.35 - 98.23 - 98.10) with the prospect of reaching the final Schiff Line (97.85) and the upper boundary of ISL38. 2 (97.50) of the Minuette operational scale fork.

The details of the #USDX movement are presented in the animated chart.

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Euro vs US dollar

The movement of the single European currency EUR / USD from September 24, 2019 will also be determined by the processing and the direction of the breakdown of the boundaries of the 1/2 Median Line channel (1.1010 - 1.0980 - 1.0955) of the Minuette operational scale fork. Look at the animated chart for the details of the marking movement inside this channel.

The breakdown of the lower boundary of the 1/2 Median Line channel (support level of 1.0955) of the Minuette operational scale fork will determine the further development of the movement of the single European currency in the equilibrium zone (1.0955 - 1.0927 - 1.0905) Minuette operational scale forks with the prospect of reaching the warning UWL61.8 (1.0870) and LTL control (1.0860) lines of the Minuette operational scale forks.

Meanwhile, In case of breakdown of the upper boundary of the 1/2 Median Line channel (resistance level of 1.1010) of the Minuette operational scale fork, it will be possible to develop an upward movement of EUR / USD to the boundaries of the 1/2 Median Line channel (1.1030 - 1.1050 - 1.1070) of the Minuette operational scale, then continue to reach the final Shiff Line Minuette (1.1095) and update the local maximum 1.1110.

The details of the EUR / USD movement options is shown in the animated chart.

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Great Britain pound vs US dollar

The development of Her Majesty's GBP / USD currency movement from September 24, 2019 will depend on the development and direction of the breakdown of the boundaries of the 1/2 Median Line channel (1.2435 - 1.2390 - 1.2345) of the Minuette operational scale fork. The development markup is presented in the animated graphics.

In case of breakdown of the lower boundary of the 1/2 Median Line channel (support level of 1.2345) of the Minuette operational scale fork, it will be important to reach and test GBP / USD of the boundaries of the equilibrium zones of the Minuette operational scale fork (1.2325 - 1.2245 - 1.2165) and Minuette (1.2305 - 1.2220 - 1.2135).

On the contrary, if Her Majesty's currency returns above the resistance level of 1.2435 (the upper boundary of the 1/2 Median Line Minuette channel), it will become possible to develop the upward movement of this currency instrument to the goals - local maximum 1.2582 - control line UTL (1.2610) of the Minuette operational scale fork - warning line UWL38. 2 (1.2700) of the Minuette operational scale fork.

The details of the GBP / USD movement can be seen on the animated chart.

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US dollar vs Japanese yen

The development of the USD / JPY currency movement of the "country of the rising sun" from September 24, 2019 (in fact, as with the above-mentioned currency instruments) will be due to the development and direction of the breakdown of the boundaries of the 1/2 Median Line channel (107.50 - 107.15 - 106.80) of the Minuette operational scale fork. We look at the animated chart for details.

The breakdown of the lower boundary of the 1/2 Median Line Minuette channel (support level of 106.80) will make it possible for the currency of the "land of the rising sun" to reach the boundaries of the equilibrium zone (106.65 - 106.10 - 105.60) of the Minuette operating scale fork and 1/2 Median Line Minuette channel (105.80 - 105.35 - 104.85).

A combined breakdown of the upper boundary of the 1/2 Median Line channel (resistance level of 107.50) of the Minuette operational scale fork and the upper boundary of ISL38.2 (resistance level of 107.60) of the equilibrium zone of the Minuette operational scale fork will determine the development of the upward movement of USD / JPY and whose goals will be - SSL Minuette start line (108.40) - local maximum 108.50 - UTL Minuette control line (108.70).

We look at the details of the USD / JPY movementon in the animated chart.

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The review is made without taking into account the news background. Thus, the opening of trading sessions of major financial centers does not serve as a guide to action (placing orders "sell" or "buy").

The formula for calculating the dollar index :

USDX = 50.14348112 * USDEUR0.576 * USDJPY0.136 * USDGBP0.119 * USDCAD0.091 * USDSEK0.042 * USDCHF0.036.

where power factors correspond to the weights of the currencies in the basket:

Euro - 57.6% ;

Yen - 13.6% ;

Pound Sterling - 11.9% ;

Canadian dollar - 9.1%;

Swedish Krona - 4.2%;

Swiss franc - 3.6%.

The first coefficient in the formula leads the index to 100 at the start date of the countdown - March 1973, when the main currencies began to be freely quoted relative to each other.

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GBP/USD: Johnson still has no clear plan, is it too early to sell the pound?

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Great Britain's Boris Johnson has a plan to achieve a new improved deal with the European Union, or is he just leading the country to exit without an agreement?

Last week, European Commission President Jean-Claude Juncker announced Brussels's readiness to abandon the idea of a "back-stop" on the Irish border if the British prime minister offers something new and viable. Against this background, the pound sharply jumped against the US dollar, rising above $1.2570 for the first time since mid-July. However, after Irish Foreign Minister Simon Coveney stated that there was still a lot of disagreement between the United Kingdom and the EU on issues related to Brexit, the GBP/USD pair deviated from two-month highs and the pound gave way to a correction.

Despite the approach of the next Brexit deadline, B. Johnson flatly refuses to ask the EU to prolong the transition period after October 31, which is being forced by local MPs. It would seem that in a hopeless situation, the prime minister maintains good spirits and intends to achieve a deal with the EU.

"Does Johnson have any plan to find a path in the chaos that he helped create?" It is possible that there is. At the last minute, he can bounce back to the center and form a coalition of delighted Tories and Labor in support of a modified version of the same agreement that was proposed by former Prime Minister Theresa May and was rejected three times by Parliament. In this scenario, Johnson may lose part of his right flank, but will receive the support of a sufficient number of Labor deputies and Tory rebels. At this moment, everyone will feel relief, because, finally, it will be possible to avoid a sudden and hard break with the EU. In this case, the main problem for Johnson will be finding a way to save face in the issue of the so-called "backstop". Apparently, he is ready to consider the idea of a common Irish market (at least for agricultural products), provided that the agreed text of the agreement will in no way be an admission that Northern Ireland remains in the common EU market," said the former British Minister of Government Mark Malloch Brown.

"However, many deputies and experts see a man who does not have a plan in Johnson, but an elephant in the Westminster China shop. He himself closed the path to compromise, ignores the decisions of Parliament and quickly rushes either to exit without an agreement or to the fall of his own government. His only lifeboat (if, of course, he manages to get to it) is the general election, which he will try to present as a people against Parliament battle," he added.

According to the Financial Times, the British government is ready to make Northern Ireland a special economic zone in order to avoid border checks with Ireland.

Meanwhile, Arlene Foster, leader of the Democratic Unionist Party of Northern Ireland, announced her readiness to take all decisions of London and Brussels along the Irish border if they do not violate the constitutional status of the region. The softening of the position of the DUP frees Johnson's hands, because otherwise he would lose the support of this party in the early elections.

According to estimates by the Organization for Economic Co-operation and Development, in the event of a disordered Brexit, eurozone GDP will lose 0.5% and British GDP with 2%. As a result, the currency bloc will be on the verge of decline, and Great Britain will plunge into a recession. Responding to such forecasts and Johnson's intentions to withdraw the country from the EU at any cost, market participants got rid of the pound, as a result of which the British currency approached the 2016 lows.

Three years ago, rebounding from the 1.1945-1.1985 area, the GBP/USD pair went up and reached 1.43 in January 2018.

This historical experience allows some investors who believe, if not in the UK-EU deal, then in prolonging the Brexit transition, to keep the pound in their portfolios.

If the "bullish" scenario is realized, then the GBP/USD pair will rise to the area of 1.2575-1.2645, and then to the level of 1.3100.

However, the situation around Brexit remains uncertain, so it is possible that during the fall, the GBP/USD pair will again try to test record lows in the 1.19 area.

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Gold: will the precious metal rally continue?

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This month, the gold exchange rate reached six-year highs amid softening policies of leading central banks.

The main question, which now, apparently, worries many traders, is whether the precious metal rally will continue, or are we already at the peak of the "bullish" phase of the cycle?

According to analysts at Citigroup, the prospects for gold are very favorable.

As factors that will support the precious metal, analysts call the increasing risks of a global recession and the likelihood of the Fed cutting its rate to zero.

Recall, September 18, the US Federal Reserve for the second time in a year lowered the interest rate by 0.25%, to 1.75–2%.

At first glance, the regulator did not have to lower the rate: there has not yet been an economic downturn, and the stock market is at its peak.

What circumstances force the Fed to cut rates?

First of all, the slowdown in the global economy. Against this background, a high interest rate in the United States with falling rates in Europe and Asia leads to the flight of capital from around the world to America, which pushes the USD exchange rate upward, reducing the competitiveness of the US economy. This is the main reason why the head of the White House, Donald Trump, is constantly criticizing the Fed, urging him to lower the federal funds rate.

However, what will need to be monitored in the coming years is not only the interest rate of the Federal Reserve (it is unlikely to be lowered below zero), but the size of its balance sheet, which is expected to grow many times over.

According to the forecast of the Budget Office of the US Congress, in 2020 the country's state budget deficit will amount to $1 trillion, in another two years - $1.1 trillion, and by 2028 - $1.45 trillion.

The US Ministry of Finance will cover it at the expense of debt, placing government securities and pulling dollar liquidity from the markets.

In other words, the lack of dollars is not a random phenomenon, but a systemic problem that the Fed is unlikely to be able to solve by applying " temporary patches"," Goldman Sachs analysts said.

According to them, the Fed will again have to start "printing money", increasing the balance sheet and buying up assets without the ability to stop at least until 2021.

"We believe that the fourth round of quantitative easing will start in November. According to our estimates, the Fed will fill in the system at $15-20 billion per month. By mid-2021, the volume of operations could be reduced to about $10 billion. In just three years, $375 billion will enter the market through QE," Goldman Sachs said.

Citigroup predicts that over the next two years, gold may rise in price up to $2000 per ounce.

"We expect the precious metal rate to grow and possibly overcome the mark of $2,000 per ounce, updating record highs in the next two years," they said.

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Pound at a loss, but does not lose optimism

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Hopes of the British pound to rise gradually fade, but the probability of growth still remains, analysts say. The currency of the United Kingdom slightly grew on the positive news last week, but this effect was short-lived.

Recall, last Friday, analysts marked a rally of the pound, which has risen in price on the wave of new optimism regarding a possible deal on Brexit. This rise was triggered by the comments of Jean-Claude Juncker, President of the European Commission, who stated the likelihood of Britain leaving the EU with an agreement. However, the official did not disclose the details of this decision, in connection with which experts considered the position of the pound to be rather unstable.

The experts were right in many respects: on Monday, September 23, the British currency tried to break through strong option levels on the news about alternative solutions to the problem of the Irish border, proposed by the government of Boris Johnson. Some of them even won the approval of Brexit's main opponents without a deal, the Northern Ireland Democratic Union Party (DUP). Many representatives of the EU leadership, including Juncker, softened the general rhetoric, but the signal that the EU was ready to amend the agreement and approve the deal turned out to be false. As a result, the last chance to retain Britain as part of the EU was lost.

The unstable political situation shook the British currency. It still clings to its former optimism, but it is fading before our eyes. At the same time, the GBP/USD currency pair is traded in the structure of the first impulse of decline. The goal is the level of 1.2444, and then a correction to 1.2515 is expected. In the future, analysts do not rule out a fall to the level of 1.2444 and lower, to 1.2360.

On Friday, it became clear that no real breakthrough regarding Brexit is expected. Boris Johnson is quite happy with the country's exit from the EU without a deal, and an attempt to organize new negotiations is unlikely to drastically change the current state of affairs.

In this situation, not only the pound and the entire British economy will suffer, but also the eurozone economy, analysts at the Organization for Economic Cooperation and Development (OECD) are certain. They confirmed the negative scenario in the event of a "hard" Brexit, which would hit the eurozone GDP, reducing it by 0.5 percentage points (pp), while UK GDP would fall by 2 pp.

Currently, the GBP/USD pair is trying to "hold face" and not slide to the lows, however, analysts are at a loss to answer how long the pound will last. Like a true English gentleman, it seeks to remain steadfast and a good face in any game.

In the short term, the British currency can test the range of 1.2700-1.2720, analysts said. However, the market still hopes for growth, although the priority in terms of volume remains with deferred sales. Moreover, even a slight negative signal against the GBP/USD pair will throw it into a strong resistance zone to the level of 1.2250, analysts said.

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Yen came with trump cards

The economic calendar of the last full week of September can hardly be called saturated, so investors will be focused on events of a geopolitical nature. The trade war, the conflict in the Middle East and Brexit are forcing investors to pay attention to safe haven assets, all the more so since the yen, which has become pretty cheaper in the first half of the month, is starting to look like a tidbit.

Over the past 3 weeks, USD/JPY quotes have grown by 4% amid closing short positions. De-escalation of the US-China trade conflict, lower Fed rates, revival of the European QE, a decrease in the probability of disorderly Brexit and strong macro statistics across the United States convinced investors that not everything was as bad as is commonly believed. Is it time to reduce the share of safe haven assets in portfolios? As a result, the yield on US treasury bonds began to grow, and the yen, franc and gold were in a black body. As subsequent events showed, not for long.

The attacks on Saudi Arabia, the statement by Donald Trump that he did not need a temporary deal with China on the eve of the presidential election, as well as the refusal of the Chinese delegation to visit American farmers, were seen as a signal of worsening global risk appetite and relations between Washington and Beijing. Riyadh claims that the terrorist attack was certainly funded by Tehran, and Donald Trump sends troops to the Allied camps in the Middle East and imposes sanctions against the Iranian central bank. How not to buy bonds and other safe havens in such conditions?

A deterioration in global risk appetite and a return to interest in the yen are making life difficult for the Bank of Japan. We watched the USD/JPY correction, realizing that devaluation would help accelerate inflation. Consumer prices in Japan slowed to 0.5% y/y in August, which is the worst trend since 2017.

The dynamics of Japanese inflation

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Slowing inflation theoretically unties the hands of the central bank in easing monetary policy, but everything looks different in real life. Haruhiko Kuroda is confronted by the Fed's inability to weaken the US dollar even by lowering federal funds rates and EUR/USD growth in response to the revival of the ECB's quantitative easing program. It is obvious that a further drop in the overnight rate (-0.1%) in the red zone will only aggravate the problems of Japanese banks. In the current situation it is better to sit and see how events will develop. Perhaps negotiations between Washington and Beijing will result in a breakthrough and increase in global risk appetite ... On the contrary, the resumption of the rally in the oil market poses a threat to countries importing black gold and strengthens the demand for safe-haven assets.

Technically, the bulls' inability to hold USD/JPY quotes above the upper limit of the downward trading channel is the first sign of their weakness. After reaching an intermediate target of 78.6% according to the Shark pattern, a logical pullback followed, which risks continuing in the direction of 106.9 and 106.25. The main task of the bears is to keep the pair below 107.5.

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