Indicator analysis. Daily review on October 3, 2019 for the EUR / USD currency pair

Trend analysis (Fig. 1).

On Thursday, after testing the pullback level of 38.2% - 1.0968 (blue dashed line), the price may make a pullback downward with the target 1.0933 -a pullback level of 38.2% (yellow dashed line). From this level, there is a good opportunity to work up with the target of 1.0998 - a pullback level of 50.0% (blue dashed line).

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Fig. 1 (daily chart).

Comprehensive analysis:

- indicator analysis - up;

- Fibonacci levels - up;

- volumes - up;

- candlestick analysis - up;

- trend analysis - down;

- Bollinger Lines - up;

- weekly schedule - up.

General conclusion:

On Wednesday, an upward movement is possible.

The upper target of 1.0998 is a pullback level of 50.0% (blue dashed line).

Intermediate target of 1.1068 is a pullback level of 38.2% (blue dashed line).

An unlikely scenario is the lower work with the target of 1.0923 - a pullback level of 50.0% (yellow dashed line).

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Bad times for the euro and the pound: the panic is growing

The effect of the unexpectedly weak ISM report in the manufacturing sector is played out, and the dollar will make an attempt to recover today from the fall a day earlier. At the same time, there is basically nothing to rely on the bulls - regional indices continue to decline. In particular, the reports of the Federal Reserve Bank of Chicago, Dallas and New York repeat each other like a blueprint and indicate a reduction in activity.

Moreover, the ADP report on employment in the private sector also does not give any reason for optimism. The September growth of 135 thousand below the average for 12 months, which before the publication of the report on the labor market on Friday is a negative signal.

At the same time, the focus of the market is directed, rather, towards the threat of total trade war, and not macroeconomic data. According to Mizuho Bank, China intends to refuse to cooperate with the United States on the terms of the American side. In addition, China is ready to conclude deals on short-term issues, but will not concede in a principled position - to gain a foothold in the status of the most powerful power of the 21st century.

Also on Wednesday, Washington announced its intention to introduce increased duties on certain types of products from the EU. An attempt to draw Europe into a trade war raises the degree of general tension. Nordea Bank, on the other hand, expects a strong increase in volatility in commodity currencies and puts the yen and the dollar in the first place - they will be the market favorites in the coming weeks.

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EURUSD

A weak report on the manufacturing sector, low inflation and the threat of being drawn into a trade war put pressure on the euro, which the European currency has little chance of dealing with. The nearest support is 1.0925, while further support is 1.0877. The motion vector is directed towards the lower boundary of the channel 1.0800 / 20.

GBPUSD

Behind the political battles, macroeconomic indicators fell into the background. Recent data indicate that the dynamics are negative, and the British economy has few chances to stay at the level "slightly above the market".

On Monday, reports for the 2nd quarter were published and despite the fact that they were slightly better than expected, there is no reason for optimism. GDP fell by 0.2%, annual growth of 1.3%, and investment in business continues to decline.

Activity in the manufacturing sector also indicates a decline. In September, the PMI was 48.3 p, slightly rebounding from the 6.5-year minimum in August, but the most significant is the rapid decline in construction at the fastest pace since April 2009.

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While interpretation options are still possible in the manufacturing sector, since the sector is under pressure from the general global slowdown and, as a consequence, the decline in export orders, the construction sector reflects exclusively internal trends. The level of new orders is at a historic low, which clearly indicates deep doubts about the possibility of growth in consumer demand.

Furthermore, the trend indicates that rising inflation is at risk, as real incomes are expected to fall. In this regard, the possibility of a "Brexit without a deal" acquires a distinctly ominous prospect that will require an immediate response from both the Bank of England and the government.

As historical experience shows, the Bank of England has always followed in the wake of the Fed's policy and reduced rates within 9-12 months after the "big brother". The development of the situation probably requires a softening of tax policy, however, against the backdrop of the political crisis, the government cannot concentrate on economic tasks and, moreover, count on the support of the parliament. The danger of missing time is growing, and the pound will experience increasing pressure in the coming weeks.

On Wednesday, the FTSE100 stock index lost 3.23%, even against the backdrop of a weakening pound. This is a very strong signal, indicating the approach of panic. The pound is also preparing for the second wave of decline after the reversal last September 20. Now, we have the support of 1.2230 and 1.2203, the second of them is weak and unlikely to stand, after which the pound will form a way out of the growing channel down and go to 1.1957.

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Hot forecast for EUR/USD on 10/03/2019 and a trading recommendation

Employment data from ADP really turned out to be worse than forecasts, largely justifying the most terrible assumptions. Not only that, employment growth amounted to 135 thousand, instead of 140 thousand, the previous data was also revised from 195 thousand to 157 thousand. The dollar began to lose its position even before the publication of the data, as it became known that the previous data were reviewed for the worse side. However, in general, the fluctuations were not so significant, and at the end of the day, the growth of the single European currency can be safely called symbolic.

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Although the report of the United States Department of Labor is published tomorrow, we won't be given a breath, as the day will be extremely busy. It will all begin with the publication of totals for business activity indices in Europe. In particular, the index of business activity in the services sector should decrease from 53.5 to 52.0, and the composite index from 51.9 to 50.4. Naturally, even closer approximation of the indices to the boundary value of 50.0 points will have a negative impact on investor sentiment. However, the misfortunes for the single European currency do not end there, as after that the data on retail sales are published, the growth rate of which may slow from 2.2% to 1.9%. But do not forget about the recent history of inflation, when its unexpectedly strong slowdown in Germany led to the fact that throughout Europe as a whole, inflation slowed down and did not remain unchanged. So, the latest data on retail sales in Germany showed an incredibly sharp slowdown in their growth rates. So we can safely expect that the data on retail sales will be significantly worse than forecasts, which are not optimistic anyway.

Retail Sales (Europe):

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Then comes the turn of US statistics, which, recently, clearly looks better than that of the EU. Of great interest is the data on applications for unemployment benefits, the total number of which should be reduced by 3 thousand. But then again, if you recall the ADP data, there is a possibility that they will turn out to be worse than forecasts. No less important are the final data on business activity indices. Thus, the index of business activity in the service sector can grow from 50.7 to 50.9, and the composite index from 50.7 to 51.0. However, data on production orders, which should be reduced by 0.2%, complete the block of US statistics.

Markit Composite Business Activity Index (US):

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However, it should be borne in mind that it is a holiday in Germany, so market volatility will clearly be limited.

Nevertheless, the EUR/USD pair managed to pull back from the lows of the current year, but the potential for the bulls was not so great and stagnation has already occurred around 1.0965. In fact, we did not see any cardinal change, and the pullback was local in nature. Considering what is happening in general terms, we see a consistent development of a downward trend, with fairly rational clock phases. There are no prerequisites for changing the main course.

It is likely to assume that today we are waiting for a rather interesting amplitude fluctuation, where the single currency may be under pressure at the beginning, returning the quotation to the 1.0930 area, but closer to the end of the trading day, a return to 1.0965 may occur.

Concretizing all of the above into trading signals:

• Long positions, we are considering already in the event of a stop and subsequent development in the area of 1.0930.

• Short positions, we consider in case of price consolidation below 1.0950, with the prospect of a move to 1.0930.

From the point of view of a comprehensive indicator analysis, we see that the main sector of indicators on hourly and daily periods signal selling. In turn, minute intervals alternately signal upward interest, but the quote is currently moving in narrow consolidation.

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Trading plan for EUR/USD for October 03, 2019

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Technical outlook:

The EUR/USD pair is trading at around 1.0950 at this point in writing, looking to retrace lower towards 1.0912/30 before resuming its rally. The single currency has taken out initial resistance at 1.0960 which was wave iv of a lesser degree (not labelled here). This could be the first confirmation of a potential bullish reversal ahead. There is still a lot more needed to instill further confidence on the above structure but the minimum requirement looks to be complete. Also note that fibonacci retracement and supports come in 1.0912 and 1.0930 levels, along with the back side of the resistance trend line. With the above convergences, a drop back between 1.0912/30 seems to be an ideal setup, going forward. The entire rally from 1.0879 through 1.0965 could be the first wave at a lower degree. A break of 1.1110 unfolding into 5 waves would be considered as an ideal setup for bulls.

Trading plan:

Remain long or take partial profits. Enter buying again around 1.0912/30 levels, stop below 1.0879, a target is 11110.

Good luck!

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Technical analysis of ETH/USD for 03/10/2019

Crypto Industry News:

An interesting phenomenon has emerged over the past few months: Ethereum blockchain began to gain popularity, even when the ETH price dropped. At the same time, volume as well as overall network activity have improved considerably. In addition, transaction fees at Ethereum recorded a decrease of about 50% compared to the maximum values recorded last week.

The attention of crypto enthusiasts was caught when the transaction fees paid by Ethereum users last month exceeded those of Bitcoin users. From September 22, the average ETH transfer cost between $ 0.045 to $ 0.064, while the Bitcoin confirmation fee was just $ 0.03.

Last week, Ethereum had to pay tens of cents on average. A huge number of transfers followed, and the cost of using the network increased significantly. The reason could be a FairWin scam, but it is now known that FairWin has fallen. Along with this, there was a significant decline in Ethereum network activity as well as a decrease in transaction fees: fees paid by Ethereum users dropped from 1627 ETH in the peak of last week to 500 ETH yesterday.

Technical Market Overview:

The ETH/USD pair has bounced from the technical support located at the level of $172.82 and still trades above the short-term trendline support. Nevertheless, the momentum is clearly decreasing and there is no new local high made yet, so the bears might counter-attack any time now. In the case of a spike down, the nearest technical support is located at the level of $163.98 - $162.50. Please notice, that so far the move upward does not look like an impulsive wave, but more like a kind of a Zig-Zag pattern, which is corrective pattern.

Weekly Pivot Points:

WR3 - $256.80

WR2 - $233.68

WR1 - $197.61

Weekly Pivot - $174.45

WS1 - $137.03

WS2 - $112.52

WS3 - $77.73

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 still being treated as a counter-trend correction inside of the uptrend. When the wave 2 corrective cycles are completed, the market might will ready for another impulsive wave up of a higher degree and uptrend continuation.

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Technical analysis of BTC/USD for 03/10/2019

rypto Industry News:

One of the main providers of payment services in cryptocurrencies, BitPay, has been subjected to a check on compliance with the principles of security and confidentiality, Service Service Control 2 (SOC 2).

According to the published press release, Aprio consulting company confirmed the compliance of BitPay with SOC 2 - it is a technological audit and a requirement for technology companies that ensures that clients' personal data is secure and confidential.

Passing the SOC 2 audit means that the company has met the criteria set by the American Institute of Certified Public Accountants in terms of confidentiality, security, privacy, processing integrity and availability. Commenting on the assessment, Dan Schroeder, the partner responsible for information control services at Aprio, said:

"After careful analysis, we confirmed that the design and use of the BitPay payment system meet the standards set out in SOC 2 in the field of customer data protection. SOC 2 reporting is a standard of best industry practices that assesses the company's control on issues such as transaction security and other confidential customer data ".

In mid-August, BitPay introduced new security measures on its platform, where users must undergo a one-time verification process that requires entering data such as a social security number or passport number, as well as photo ID. These measures have met with some skepticism, given the resistance that many members of the cryptocurrency community have to locate their personal data in centralized files.

Technical Market Overview:

The BTC/USD pair has failed to rally above the level of $8,474, which is a technical resistance for the price. The bears has pushed the price back to the range zone and the technical support at the level of $8,102 has been tested again. There is still a chance for the wave (C) terminated already, but if the bears will keep making pressure on bulls then the price might reverse and target the level of $7,419. The upward momentum is decreasing, so are the chances for another leg higher, which is why it is worth to keep an eye on the current situation on Bitcoin.

Weekly Pivot Points:

WR3 - $11,446

WR2 - $10,627

WR1 - $9,093

Weekly Pivot - $8,403

WS1 - $6,727

WS2 - $6,011

WS3 - $4,444

Trading Recommendations:

Due to the short-term impulsive scenario invalidation, 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 still being treated as a counter-trend correction inside of the uptrend. When the wave 2 corrective cycles are completed, the market might will ready for another impulsive wave up of a higher degree and uptrend continuation.

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Control zones USD/CAD 10/03/19

Today, the pair is trading within the upper range of the middle course. This indicates a high probability of the formation of a correctional model and the formation of a flat. Moreover, the downward movement must be used to find favorable prices for the purchase of the instrument. Weekly Control Zone 1/4 1.3290-1.3286 will be the first support zone.

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The probability of closing the week's trading above today's maximum is 30%. Thus, you should not count on the quick implementation of the upward model.

An alternative model will be developed if the closure of today's trading occurs below the Weekly Control Zone 1/4. This will mean the formation of a deep correction and the continuation of the medium-term flat. In this case, tomorrow's work will be to receive purchases at lower prices at the WCZ 1/2 1.3246-1.3237.

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

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

Monthly CZ - monthly control zone. The zone that reflects the average volatility over the past year.

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GBP/USD: plan for the European session on October 3. Boris Johnson's new Brexit plan did not lead to the pound's growth

To open long positions on GBP/USD you need:

Yesterday, the UK government announced a new Brexit plan and said that this is the final proposal, and if it is not accepted by the EU, then the UK will leave the EU without an agreement. In a nutshell, the essence of the proposal does not provide for customs points on the border between Ireland, which the EU representatives so sought. However, there are a number of nuances, because of which the demand for the pound remained quite weak. The next formation of a false breakdown in the region of 1.2263 this morning will be a signal to buy the pound, which will lead to an upward correction of the pair to the area of the upper boundary of the side channel at 1.2327, consolidating above which will strengthen demand for GBP/USD, which will update the resistance at 1.2364, where I recommend take profits. However, in the event of a weak report on the UK services sector, which is scheduled to be released today in the morning, the level of 1.2263 may be broken. In this scenario, it is best to consider purchases in GBP/USD after updating the lows in the areas of 1.2207 and 1.2165.

To open short positions on GBP/USD you need:

Once again, the bears managed to protect the level of 1.2327, to which I repeatedly paid attention. It will be possible to talk about the continuation of the bearish trend only after the breakout of support at 1.2263, which may coincide with the release of weak PMI data for the UK services sector. This will lead to a decrease in GBP/USD to the low of this month to the level of 1.2207, the breakdown of which will only increase the pressure on the pair, allowing sellers to reach the support of 1.2165, where I recommend taking profits. If the pressure on the pair weakens, in case of good PMI data or a positive decision from the EU according to the proposed Brexit plan, it is best to sell the pound after an upward correction to the upper boundary of the side channel at 1.2327, subject to the formation of a false breakdown, or immediately to rebound from a high of 1.2364 and 1.2400.

Signals of indicators:

Moving averages

Trade is carried out in the region of 30 and 50 moving average, which indicates some market uncertainty.

Bollinger bands

In case the pound declines, support will be provided by the lower boundary of the indicator in the region of 1.2263, while the upper boundary of the indicator in the region of 1.2327 will act as resistance.

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Description of indicators

  • MA (moving average) 50 days - yellow
  • MA (moving average) 30 days - green
  • MACD: Fast EMA 12, Slow EMA 26, SMA 9
  • Bollinger Bands 20
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Technical analysis of GBP/USD for 03/10/2019

echnical Market Overview:

The GBP/USD pair has tried to rally again after another Bullish Engulfing pattern was made, but failed to break through the technical resistance located at the level of 1.2308 and dynamic trendline resistance around this area. The bears are still in control over this market, despite the bullish struggling to bounce higher and rally. Please notice, the market conditions are still quite oversold and the RSI is showing a negative and weak momentum, so the bounce might continue higher, but the level of 61% Fibonacci can not be violated.

Weekly Pivot Points:

WR3 - 1.2628

WR2 - 1.2566

WR1 - 1.2402

Weekly Pivot - 1.2333

WS1 - 1.2163

WS2 - 1.2096

WS3 - 1.1935

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. The key short-term technical support is seen at the level of 1.2231 - 1.2224 and the key short-term technical resistance is located at the level of 1.2381. As long as the price is trading below this level, the downtrend continues towards the level of 1.1957 and below.

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Technical analysis of EUR/USD for 03/10/2019

echnical Market Overview:

The EUR/USD pair has made local high located at the level of 1.0966, just at the technical resistance level. The bulls still have a chance for a move towards the level of 1.1024 and higher towards the level of 1.1075, but they need to break out of the descending channel. The momentum is now above its fifty levels, so it is positive and strong, and the market conditions are not overbought yet as well. There is a chance for another leg up towards the next targets, but it must be made soon, otherwise, the bears will regain the control over the market again and push the prices towards the technical support at the level of 1.0879.

Weekly Pivot Points:

WR3 - 1.1116

WR2 - 1.1087

WR1 - 1.0996

Weekly Pivot - 1.0951

WS1 - 1.0872

WS2 - 1.0826

WS3 - 1.0757

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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EUR/USD: plan for the European session on October 3. Euro growth will continue further after services data

To open long positions on EURUSD you need:

A weak report from ADP kept the European currency buyers in the market, which reached another important resistance level at 1.0965. At the moment, the main upward movement of the euro will depend on the PMI data for the eurozone services sector, as well as on the composite eurozone PMI index. Good data will help the bulls break above the resistance level of 1.0965, which will lead to the preservation of the upward trend and the pair from reaching the highs of 1.0993 and 1.1022, where I recommend taking profit. In a scenario of weak data, which cannot be ruled out, given the current state of the eurozone economy, it is best to return to long positions in EUR/USD on a false breakdown from the level of 1.0935, or buy on the rebound from yesterday's major support at 1.0905.

To open short positions on EURUSD you need:

All that is required today by euro sellers in the morning is the formation of a false breakdown in the resistance area of 1.0965 and poor data on the services sector, especially Germany. In the coupe, this will be a good signal to open short positions, and the level of 1.0965 will become the upper limit of the side channel, in which the euro will become stuck until the end of the week. The aim of the sellers will be the support of 1.0935, the breakdown of which will quickly return EUR/USD to the area of yesterday's low of 1.0905, where I recommend taking profit. With a growth scenario above 1.0965, it is best to return to short positions from a resistance of 1.0993, or sell for a rebound from a larger high of 1.1022.

Signals of indicators:

Moving averages

Trading is conducted above 30 and 50 moving average, which indicates the likely continuation of the upward correction.

Bollinger bands

In the event of a EUR/USD decline in the morning, support will be provided by the lower boundary of the indicator around 1.0925. Growth will be limited by the upper boundary at 1.0980.

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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

Control zones NZD/USD 10/03/19

Today, the pair is trading within the Weekly Control Zone 1/2 0.6267-0.6261. To continue the decline, the formation of a pattern of absorption or false breakdown will be required. In case of reduction, the first target will be the October minimum. A further drop will depend on the reaction to the monthly minimum.

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If the closing of trading at today's Asian session occurs above the level of 0.6267, then this will be the first signal to form a reversal model of a higher timeframe.

An alternative model will be developed if the closure of today's trading occurs above the Weekly Control Zone 1/2. This will open the way for the pair to grow to a weekly control zone of 0.6333-0.6321. It is important to understand that the formation of the "false breakdown" pattern at the daily level took place at the beginning of the current month. Moreover, the potential medium-term movement in case of violation of the bearish structure will be 250 points.

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

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

Monthly CZ - monthly control zone. The zone that reflects the average volatility over the past year.

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Technical analysis: Important Intraday Levels For EUR/USD, October 03, 2019

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When the European market opens, some economic data will be released such as French 10-y Bond Auction, Retail Sales m/m, PPI m/m, Final Services PMI, German Final Services PMI, French Final Services PMI, Italian Services PMI, and Spanish Services PMI. The US will also publish the economic data such as Natural Gas Storage, Factory Orders m/m, ISM Non-Manufacturing PMI, Final Services PMI, Unemployment Claims, and Challenger Job Cuts y/y, 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: 1.1013. Strong Resistance: 1.1007. Original Resistance: 1.0996. Inner Sell Area: 1.0985. Target Inner Area: 1.0960. Inner Buy Area: 1.0935. Original Support: 1.0924. Strong Support: 1.0913. Breakout SELL Level: 1.0907. (Disclaimer)The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis: Important Intraday Levels for USD/JPY, October 03, 2019

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In Asia, Japan will not release any economic reports today, while the US will publish some economic data such as Natural Gas Storage, Factory Orders m/m, ISM Non-Manufacturing PMI, Final Services PMI, Unemployment Claims, and Challenger Job Cuts y/y. 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: 107.66. Resistance. 2: 107.45. Resistance. 1: 107.24. Support. 1: 106.97. Support. 2: 106.76. Support. 3: 106.55. (Disclaimer)The material has been provided by InstaForex Company - www.instaforex.com

USD/CAD: Canadian dollar follows the oil market in anticipation of US Nonfarm

Despite the general weakening of the US currency, the USD/CAD pair jumped more than 100 points yesterday, reaching 1.3324 and thereby updating the monthly high. The Canadian dollar fell in price not only against the greenback, but also in cross pairs, for example, against market outsiders such as the Australian dollar and New Zealand dollar. This vulnerability of the loonie is explained by the downward dynamics of the oil market, amid a slowdown in the growth of the national economy. The combination of unipolar fundamental factors helped the USD/CAD bulls provoke an upward impulse, after which the pair consolidated within the 33rd figure.

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Data on Canadian GDP growth, which was published on October 1, only confirmed the fears of many analysts regarding the further actions of the Canadian central bank. The indicator came out in the "red zone", not justifying the forecasts of most analysts: on a monthly basis, the indicator was at zero level (with a weak forecast of growth to 0.1%), while in annual terms it dropped to 1.3% (with the forecast growth up to 1.4%). Such weak dynamics discouraged USD/CAD traders, since macroeconomic reports from Canada have recently been controversial, putting pressure on the loonie.

Let me remind you that following the September meeting of the Bank of Canada, Stephen Poloz, contrary to numerous rumors, did not announce the interest rate cut, and indeed left this question in the air. According to him, everything will depend on the dynamics of the development of the trade war, as well as on incoming data. The prospects for resolving the global conflict look vague - the financial world is waiting for the October meeting of the representatives of Beijing and Washington. Given the background to the issue and Trump's political situation, it's hard to predict how this round of negotiations will end. Amid such uncertainty, the incoming Canadian data does not bring any clarity - on the contrary, the contradictory dynamics of key indicators leaves more questions than answers.

For example, inflation indicators in Canada showed good growth, but retail data frankly disappointed. At first glance, indicators published in mid-September on labor market growth reflected a positive picture. The unemployment rate remained unchanged (5.7%), and the number of employed jumped immediately to 80 thousand, with a forecast of growth of only 18 thousand. On the other hand, this dynamic was mainly due to an increase in underemployment. This is a rather alarming signal, which indicates a possible slowdown in inflationary growth. The data on the growth of the national economy of Canada only complicated this puzzle. And although the next meeting of the Bank of Canada is still relatively far (it will be held on October 30), it has been mentioned on the market that this time the regulator will take a more "dovish" position, announcing a rate cut. Some analysts suggested that the rate will be reduced already at the October meeting, and members of the Canadian regulator will verbally "prepare" the markets for this step over the coming weeks.

This fundamental picture was exacerbated yesterday by a decline in the oil market. The price of a barrel of Brent crude oil yesterday fell to the lowest level since the beginning of September (now the price is at $57), while the cost of a barrel of WTI crude oil fell to $52, which is 1.6% lower than the previous trading level (and the lowest level for the last 4 weeks). The downward trend is due to several factors. Firstly, Saudi Arabia quickly restored oil production after the September attack. At the moment, the state-owned company Saudi Aramco is pumping the same 9.8 million barrels per day, as it was before the September 14 incident.

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Secondly, according to data released yesterday, the US has significantly increased reserves of "black gold" - over the week, the corresponding volume grew by 3.1 million barrels. Analysts did not expect such numbers - analysts interviewed by Reuters forecasted the growth of these reserves by only 1.5 million barrels. This is the highest weekly increase over the past 5 months. At the same time, unofficial data (from the American Petroleum Institute) on the eve assured the market that the volume of stocks would decrease significantly. Such a dissonance in the context of "expectation/reality" exerted strong pressure on the oil market and indirectly on commodity currencies, including the Canadian dollar.

Thus, the Canadian dollar is under pressure from a negative fundamental background - both from domestic statistics and from the oil market. The possible dovish-like reaction of the central bank's representatives only aggravates the situation of the Canadian currency. At the same time, we need another newsmaker for the further growth of the USD/CAD pair, since the current upward impulse has already faded. The pair approached the resistance level of 1.3340 (the upper line of the BB indicator on the daily chart), but could not overcome it to rise to the boundaries of the 34th figure. Another surge in volatility is expected on Friday: if the American Nonfarm come out better than expected, the USD/CAD bulls can resume the upward movement again.

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Forecast for EUR/USD on October 3, 2019

EUR/USD

According to ADP, the economic indicator on new created jobs in the US private sector, published on Wednesday, weakened the dollar - the September index was 135 thousand against the expectation of 140 thousand, and the August figure was revised down from 195 thousand to 157 thousand. The euro grew by 26 points. A double convergence on the Marlin oscillator was formed on the daily scale chart. This is a strong pattern of expected growth, but the price needs to overcome the resistance of the Fibonacci level of 138.2% at the price of 1.0985, in this case, the target in the area of 123.6% and the MACD line will become open (1.1065).

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On the H4 chart, the price reached the MACD line. Overcoming the Fibonacci level of 138.2% (1.0985) will mean consolidation above the line and, accordingly, will be its own signal to continue growth.

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If the price goes below yesterday's low (1.0904), it will also mean that the signal line of the Marlin oscillator will go into the declining trend zone. In this case, we are waiting for the price in the range of 1.0805/45.

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Forecast for GBP/USD on October 3, 2019

GBP/USD

The British pound for the second time tested the support of the Fibonacci level of 223.6% yesterday, but unlike Tuesday, the momentum was weaker, the day again closed near the opening of the week. The Marlin oscillator on the daily chart continues to slowly decline.

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On the four-hour chart, the price also stopped at the resistance of the balance line. The trend continues to decline despite the exit of the Marlin oscillator in the growth zone, as it may indicate a possible growth until above the MACD line (1.2375). The exit of the price above this line can already indicate a more serious mood of the market - to the line of the price channel with the goal of 1.2495.

Consolidating the price below 1.2230 will finally open the target of 1.2144 - support for the price channel line on the daily scale chart.

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Forecast for AUD/USD on October 3, 2019

AUD/USD

The Australian dollar has almost reached the target support of the embedded line of the red price channel. This channel has a six-year length, and at such a length, within the framework of fluctuations, the channel can be considered exhausted. On the daily chart, the trend is still falling; the price is below the lines of balance and MACD, the indicator lines themselves are directed downward, the Marlin oscillator goes deeper into the zone of negative trend.

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A small convergence on the oscillator was formed on the four-hour chart, which may indirectly indicate the development of the price channel line. In this case, a correction to the MACD line is possible, near the 0.6740 mark. Here the price will meet the release of US employment data on Friday. Weak data can help the price to reach the resistance of the price channel line and the MACD line on the daily scale – 0.6800, strong indicators will set the price to reach new lows, the nearest target 0.6588 is the support of the blue price channel (daily).

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Fractal analysis of the main currency pairs for October 3

Forecast for October 3:

Analytical review of currency pairs on the scale of H1:

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For the euro / dollar pair, the key levels on the H1 scale are: 1.1007, 1.0991, 1.0966, 1.0912, 1.0880, 1.0839, 1.0811 and 1.0761.Here, the price is in correction and forms a small potential for the top of October 1. The development of the ascending structure of October 1 is expected after the breakdown of the level of 1.0966. In this case, the first goal is 1.0991. Price consolidation is n the range of 1.0991 - 1.1007. We expect the design of expressed initial conditions for the upward cycle up to the level of 1.1007. The continuation of the movement to the bottom is expected after the breakdown of the level of 1.0912. In this case, the first target is 1.0880. The breakdown of which will allow us to count on movement to the level of 1.0839. Short-term downward movement, as well as consolidation is in the range of 1.0839 - 1.0811. For the potential value for the bottom, we consider the level of 1.0761. Upon reaching this level, we expect a pullback to the top.

The main trend is the descending structure of September 13, the stage of deep correction.

Trading recommendations:

Buy: 1.0967 Take profit: 1.0990

Buy Take profit:

Sell: 1.0912 Take profit: 1.0884

Sell: 1.0880 Take profit: 1.0840

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For the pound / dollar pair, the key levels on the H1 scale are: 1.2422, 1.2395, 1.2352, 1.2318, 1.2258, 1.2228, 1.2203 and 1.2156. Here, the price is in correction from the downward structure and forms a small potential for the top of October 1. Short-term upward movement is expected in the range of 1.2318 - 1.2352. The breakdown of the latter value will lead to the formation of expressed initial conditions for the upward cycle of October 1. Here, the target is 1.2395. Noise range 1.2395 - 1.2422.

Short-term downward movement is expected in the range 1.2258 - 1.2228. The breakdown of the latter value will lead to the subsequent development of a downward trend in the scale of H1. In this case, the first goal is 1.2203. For the potential value for the bottom, we consider the level of 1.2156. Upon reaching this level, we expect a pullback to the top.

The main trend is the descending structure of September 20, the correction stage.

Trading recommendations:

Buy: 1.2318 Take profit: 1.2350

Buy: 1.2353 Take profit: 1.2395

Sell: 1.2258 Take profit: 1.2230

Sell: 1.2226 Take profit: 1.2203

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For the dollar / franc pair, the key levels on the H1 scale are: 1.0091, 1.0054, 1.0039, 1.0016, 0.9994, 0.9957, 0.9941, 0.9919 and 0.9895. Here, the price has formed a local structure for the subsequent development of an upward trend on the H1 scale. Short-term upward movement is expected in the range 0.9994 - 1.0016. The breakdown of the latter value will lead to a movement to the level of 1.0039. Price consolidation is near this level. The passage at the price of the noise range 1.0039 - 1.0054 should be accompanied by a pronounced upward movement. Here, the potential target is 1.0091.

Short-term downward movement is possibly in the range of 0.9957 - 0.9941. The breakdown of the last value will have the downward movement. Here, the first goal is 0.9919. As a potential value for the bottom, we consider the level of 0.9895.

The main trend is the local ascending structure of October 2.

Trading recommendations:

Buy : 0.9995 Take profit: 1.0014

Buy : 1.0017 Take profit: 1.0039

Sell: 0.9956 Take profit: 0.9941

Sell: 0.9939 Take profit: 0.9919

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For the dollar / yen pair, the key levels on the scale are : 107.63, 107.44, 107.32, 107.01, 106.78 and 106.48. Here, we are following the development of the downward cycle of October 1. The continuation of movement to the bottom is expected after the breakdown of the level of 107.01. In this case, the target is 106.78. Price consolidation is near this level. For the potential value for the downward movement, we consider the level of 106.48. Upon reaching which, we expect a pullback to the top.

Short-term upward movement is expected in the range of 107.32 - 107.44. The breakdown of the last value will lead to an in-depth correction. Here, the goal is 107.63. This level is a key support for the downward structure.

The main trend: the downward cycle of October 1.

Trading recommendations:

Buy: 107.32 Take profit: 107.43

Buy : 107.46 Take profit: 107.63

Sell: 107.00 Take profit: 106.80

Sell: 106.75 Take profit: 106.48

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For the Canadian dollar / US dollar pair, the key levels on the H1 scale are: 1.3369, 1.3350, 1.3336, 1.3304, 1.3287 and 1.3254. Here, we are awaiting the formalization of the expressed initial conditions for the upward cycle of October 2. Short-term upward movement is possibly in the range 1.3336 - 1.3350. From here, we expect a key reversal in the correction. For the potential value for the top, we consider the level of 1.3369.

Short-term downward movement is possibly in the range of 1.3304 - 1.3287. The breakdown of the latter value will lead to an in-depth correction. Here, the target is 1.3254. This level is a key support for the top.

The main trend is the formation of the upward potential of October 2.

Trading recommendations:

Buy: 1.3336 Take profit: 1.3350

Buy : 1.3352 Take profit: 1.3369

Sell: 1.3304 Take profit: 1.3390

Sell: 1.3285 Take profit: 1.3260

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For the Australian dollar / US dollar pair, the key levels on the H1 scale are : 0.6755, 0.6730, 0.6716, 0.6673, 0.6651, 0.6637 and 0.6607. Here, we are following the local downward cycle of September 24. At the moment, the price is in the correction zone. The continuation of the movement to the bottom is expected after the breakdown of the level of 0.6670. In this case, the target is 0.6651. Price consolidation is in the range of 0.6651 - 0.6637. For the potential value for the bottom, we consider the level of 0.6607. Upon reaching this level, we expect a pullback to the top.

Short-term upward movement is possibly in the range of 0.6716 - 0.6730. The breakdown of the last value will lead to a long correction. Here, the potential target is 0.6755. This level is a key support for the downward structure.

The main trend is the downward cycle of September 13, the correction stage.

Trading recommendations:

Buy: 0.6716 Take profit: 0.6730

Buy: 0.6734 Take profit: 0.6755

Sell : 0.6670 Take profit : 0.6652

Sell: 0.6635 Take profit: 0.6607

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For the euro / yen pair, the key levels on the H1 scale are: 118.01, 117.77, 117.61, 117.29, 117.16, 116.81 and 116.57. Here, we determined the next goals from the local descending structure on September 27. The continuation of the movement to the bottom is expected after the price passes the noise range 117.29 - 117.16. In this case, the target is 116.81. For the potential value for the bottom, we consider the level of 116.57. Upon reaching which, we expect a rollback to the correction.

Short-term upward movement is possibly in the range 117.61 - 117.77. The breakdown of the latter value will lead to in-depth movement. Here, the goal is 118.01. This level is a key support for the downward structure.

The main trend is the local descending structure of September 27.

Trading recommendations:

Buy: 117.61 Take profit: 117.75

Buy: 117.80 Take profit: 118.00

Sell: 117.14 Take profit: 116.85

Sell: 116.78 Take profit: 116.60

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For the pound / yen pair, the key levels on the H1 scale are : 134.58, 133.36, 132.72, 131.45, 130.78 and 129.88. Here, we are following the development of the descending structure of September 20. Short-term movement to the bottom is expected in the range 131.45 - 130.78. The breakdown of the latter value will lead to movement to a potential target - 129.88. When this level is reached, we expect a pullback to the top.

Short-term upward movement is possibly in the range of 132.72 - 133.36. The breakdown of the last value will lead to a long correction. Here, the target is 134.58. We also expect the formation of expressed initial conditions for the upward cycle to this level.

The main trend is the descending structure of September 20.

Trading recommendations:

Buy: 132.72 Take profit: 133.30

Buy: 133.40 Take profit: 134.55

Sell: 131.43 Take profit: 130.80

Sell: 130.74 Take profit: 129.90

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Trading Idea for NZD/CAD

As you know, cross-rates are an excellent tool for hedging positions in "majors", such as the most popular of them - the EUR/USD pair.

I recommend for each position in major - to have a position in the "right" cross, and you will appreciate this tactic of distributing profits between instruments.

Let's pay attention to the very oversold NZD/CAD cross-instrument, which has passed 10,000 p for 5 figures almost without a pullback since March 2019. However, several people know that this cross has an average rollback passage of exactly 10 points. And right now, after updating the minimum of 2015, it makes sense to buy it with a potential of at least 3,000 p at 5 figures.

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It is easier to do this by collecting a grid of orders in longs on pullback movements. In fact, you will work out a false breakdown on an annual scale, or rather - for 4 years. This does not happen every day. Therefore, it is necessary to take advantage of this unique opportunity.

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EUR/USD: dizzying somersaults of the dollar and cautious hopes for the euro's growth

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After reaching 2.5-year peaks, the USD index turned sharply to decline amid the release of disappointing data on manufacturing activity in the United States.

The ISM's PMI in the US manufacturing sector fell to 47.8 in September from 49.1 in August. The rate has reached its lowest level in more than a decade.

After the publication of a weak report on business activity in the US manufacturing sector, the head of the White House, Donald Trump, had another reason to criticize the Federal Reserve, and the latter to lower the interest rate. The US president has already taken advantage of it. He said Fed Chairman Jerome Powell and his colleagues allowed the greenback to strengthen so much that it negatively affected US manufacturers. Only time will tell whether the Federal Reserve will resort to weakening monetary policy. Following the release of the ISM manufacturing index, the chances of the Fed cutting interest rates in October rose from 40% to 65%. It seems that investors are confident that the cycle of monetary expansion in the United States will continue.

At first glance, there is no reason to panic, since the US manufacturing sector accounts for only 11% of the country's GDP and 8.5% of employment, but transport services, warehouses and retail trade depend on production. Given these relationships, the Wall Street Journal estimates the contribution of manufacturing to US GDP at 30%.

Obviously, the US economy is slowing down because of the trade wars, forcing analysts to think about how slowly it can grow without sliding into a recession.

Growth of less than 2% earlier almost guaranteed a reduction in the future. Now, some economists believe that this indicator may fluctuate around 1% -1.5%, not necessarily portending a recession.

According to the head of the Federal Reserve Bank of Chicago Charles Evans, a 50% reduction in the federal funds rate will ensure a 2.25% GDP growth this year, 2% inflation over the next few years and unemployment slightly below 4%. Bloomberg analysts expect the US economy to expand 2.3% this year.

However, weak data on business activity in the United States cast doubt on these figures. If the global index of purchasing managers has been below the critical level of 50 for the fifth month in a row, then the American counterpart is only the second. While many countries have already adapted to trade wars, the United States is only beginning to sense their negative effects. This may be a bullish factor for EUR/USD.

Thus, if the Federal Reserve used to cut the interest rate due to international risks, which were evidenced by investors' flight into safe haven assets and a decrease in the yield of treasuries, now the regulator has an internal argument for easing monetary policy. Given the split in the ranks of the ECB Governing Council and the limitations of its "arsenal", the rebound of the EUR/USD pair from support at 1.0875-1.0885 seems quite logical. The bulls will be able to continue the attack in the event of the release of weak statistics on the US labor market in September. According to forecasts, the US economy created 147 thousand new jobs in the first month of autumn, which is 17 thousand more than in August. However, the publication of the ISM manufacturing index reinforced concerns that actual numbers would not reach forecast estimates. Another factor in support of the euro may be reaching an agreement between the UK and the EU on the terms of Brexit, but this still remains a big question.

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Gold does not need peace

The fall in business activity in the US manufacturing sector to the area of a 10-year low drove the arrogance of gold sellers, but did not convince buyers to return to long positions. The bulls are seriously frightened by the collapse of XAU/USD quotes and want additional arguments in favor of the restoration of the trend. For example, weak statistics on the US labor market for September, which will convince the Federal Reserve of the need to further reduce the rate on federal funds.

After four quarters of growth, which is the longest series in the last 8 years, the precious metal has entered a correction. Growing net long positions, speculators realized that they had gone too far. They were guided by the idea of slowing down the global economy, record low profitability of the global debt market and the Fed's focus on easing monetary policy for preventive purposes. In fact, if the next round of US-China trade negotiations ends with a breakthrough, global GDP will begin to regain lost ground, US stock indices will refresh record highs, risk appetite will increase, and safe haven assets will come under pressure.

It is not a fact that global debt market rates will continue to go down. Investors are actively discussing the version that central banks have overdone easing monetary policy. They are unable to cope with trade wars, and it takes fiscal stimulus, not monetary, to keep the affected economies afloat. Contrary to the federal funds rate cut, the US dollar is not going to fall. As a result, the XAU/USD "bears" had serious arguments for attacks, although not all "bulls" intend to give up. In particular, TD Securities believes that the precious metal can still grow to $1,600 per ounce.

The precious metal's fans bet on the deterioration of relations between Washington and Beijing. As the index of purchasing managers in the manufacturing sector shows, the US economy is already beginning to feel the pain of trade wars. If GDP, instead of the 2.3% expected by Bloomberg analysts, grows in 2019 by 1.5% or less, the Fed will be forced to aggressively weaken its monetary policy. This will strike both the US dollar and the yield on Treasury bonds, and lend a helping hand to gold.

US GDP dynamics

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Thus, the precious metal is unlikely to determine the further direction of its movement after the release of data on business activity and the US labor market. It needs information on the course of trade negotiations between Washington and Beijing. In my opinion, the risks of escalating the conflict are great: if Donald Trump agrees to a partial agreement, the Democratic opponents will actively criticize him. But there are no special prerequisites for concluding a comprehensive agreement: the positions of the conflicting parties vary significantly.

Technically, a head and shoulders reversal pattern was formed on the daily gold chart. Quotes may go down to the target for this model, which is near $1412 per ounce. On the contrary, if the "bulls" manage to return them above the neckline ($1490-1500), their chances of restoring the upward trend will increase significantly.

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A predicted fall for the kiwi, but it maintains defense

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The New Zealand dollar is held captive by conflicting trends. On the one hand, it is seen to fall due to the general easing of monetary policy by world central banks, and on the other, it is trying to maintain his gains.

The NZD/USD pair could not develop an upward correction above the local resistance level of 0.6443 at the beginning of September. As a result, the pair resumed to fall, analysts said. The NZD/USD pair was trading near the 0.6225 mark, below the short-term resistance level of 0.6293, on Tuesday, October 1. An alternative scenario could be a breakdown of the local resistance level of 0.6365 and corrective growth with targets at positions 0.6443 and 0.6490, analysts said. They also do not exclude a retest of 0.6260.

According to analysts, further growth of the NZD/USD pair is unlikely if the Federal Reserve does not aggressively reduce interest rates. At the same time, the New Zealand regulator is inclined to cut rates, analysts said. They allow such an opportunity since the leadership of the Reserve Bank of New Zealand (RBNZ) is set to further soften its monetary policy.

Recall that in August of this year, the RBNZ reduced the interest rate immediately by 50 basis points (bp) to 1.00%. The regulator explained his decision by the aggravation of trade confrontation between the US and China, as well as the loss of momentum in the New Zealand economy.

In this situation, the NZD/USD pair may again test record lows of 2015 near the psychologically important mark of 0.6200. The kiwi's further fall depends on the strengthening of the US dollar index over the levels of 99.40–99.60, analysts said. A breakthrough of a local high in the index chart along with a breakdown of the record low in the NZD/USD chart can provoke a radical reversal of the current trend. With further abnormal growth of the US dollar above 99.40 and in case of a breakthrough of the bar of 99.60, analysts do not exclude a powerful collapse in the quotes of the NZD/USD pair. With the implementation of such a scenario, it is possible for the pair to collapse up to the levels of 0.6140-0.6120, analysts said.

The New Zealand currency remains vulnerable due to the high risk of a slowdown in the global economy and a protracted trade conflict between the United States and China, which remain the country's largest trading partners. The kiwi is currently trading in the range of 0.6233–0.6236, trying to stay at current levels.

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