Analysis of EUR / USD and GBP / USD for October 16. Optimism is sweeping the currency market.

EUR / USD

analytics5da6b2bf0ecfc.png

Tuesday, October 15, ended for the EUR / USD pair with an increase of 5 basis points. Thus, the current wave marking has not changed again and, as before, it involves the construction of an upward set of waves. Now, it's even difficult to say whether the construction of the correctional wave b has begun, since the departure of the quotes from the reached highs is insignificant. At the same time, an unsuccessful attempt to break through the 23.6% level suggests that the markets are ready to continue raising the instrument.

Fundamental component:

The fundamental background for the EUR / USD pair remains weak and practically does not play a role. On Tuesday, the index of sentiment in the business environment in the European Union came from the ZEW Institute was released, to which few people paid their attention to. Similar indices were released in Germany, which also did not attract the attention of the markets. Today, the situation will be a little better. On Wednesday, a very important report on inflation in the European Union will be released. If we omit the fact that inflation continues to slow down in the EU, the future actions of the ECB largely depend on the inflation rate. Thus, a new decrease in the consumer price index will mean an increase in the chances of another reduction in the ECB rate. And in itself, this phenomenon cannot be called positive for the European currency. With this inflation rate, markets may start selling euros again. A value of at least 0.9% yoy could help the euro-dollar pair hold slightly above the 23.6% Fibonacci level.

Purchase goals:

1.1083 - 38.2% Fibonacci

1.1145 - 50.0% Fibonacci

Sales goals:

1.0879 - 0.0% Fibonacci

General conclusions and recommendations:

The euro-dollar pair is supposedly continuing to build a new upward set of waves. At the same time, the news background can "turn" the instrument down at any moment, but I still expect a moderate increase in quotes with targets located near the levels of 1.1083 and 1.1145. An unsuccessful attempt to break the level of 1.1083 may lead to a departure of quotes from the reached highs and the construction of wave b.

GBP / USD

analytics5da6b917bff4b.png

On October 15, the GBP / USD pair gained 180 more base points and, thus, continued to build the proposed wave 3 or C of a new upward trend section. An unsuccessful attempt to break the level of 100.0% Fibonacci can not only lead to the departure of quotations from the highs, but also to complete the construction of the whole of the third wave, which is already equal to 100.0% of wave size A. On the other hand, a successful attempt to break the 100.0% level will indicate the readiness of the currency market to new increase on the pound-dollar instrument.

Fundamental component:

The currency market continues to look with hope for the upcoming EU summit on Brexit. Otherwise, it is impossible to explain the increase in the pound by more than 600 basis points in 4 days. The markets are gradually receiving information that the British Prime Minister, Boris Johnson, continues to negotiate with Michel Barnier and the main EU politicians, and there is progress in the negotiations. Some politicians and experts, in turn, even argue that a deal is possible at the EU summit. It's hard for me to judge how true this information is, since no details are coming to the market. And if there are no details, then there is no reason for blind faith in the data on the progress in the negotiations. Everything will be decided tomorrow or the day after tomorrow. Guessing how it all ends does not make sense since Brexit has already been postponed several times when everyone was waiting for Parliament to approve the deal. This time may not be an exception, especially if one takes into account the negative and openly hostile attitude of the British deputies towards the figure of Boris Johnson. Today, I also draw attention to the report on inflation in the UK. Although in recent years, economic reports have not influenced the pair too much. Thus, one should not miss the output of the indicator, which is very important for the economy of any country.

Sales goals:

1.2191 - 0.0% Fibonacci

Purchase goals:

1.2817 - 100.0% Fibonacci

1.2986 - 127.2% Fibonacci

General conclusions and recommendations:

The pound / dollar instrument continues to build an upward trend. Thus, I can recommend new purchases of the instrument in case of a successful attempt to break through the Fibonacci level of 100.0%, which is almost reached. However, I think the current levels are very high for the pound, and if Brexit does not end in favor of the UK this week, then there is a high probability of building a new downward trend.

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

GBP/USD. The fate of Brexit: what Johnson agreed to and will the House of Commons support the deal?

The pound paired with the dollar came close to the 28th figure yesterday, having grown a total of 600 points over the past week. Such a sharp reversal of the pair is explained by the contrast of the fundamental background: back in September, traders were seriously preparing for the "hard" Brexit, while today there are more or less real chances for a deal - if not at the October EU summit, then at the beginning of next year. But a temporary backlash of several months does not scare investors who have been expecting this event for several years. Negotiations between London and Brussels began in the fall of 2016, and should have been completed before March 29, 2019, but Theresa May was not able to convince members of the British Parliament to support the draft deal agreed with the EU. Boris Johnson is now in a similar situation, however, with some significant differences.

analytics5da6b068bcd1c.jpg

The GBP/USD pair traded flat for most of the day yesterday, and ignored even key UK labor market data. But in the midst of the US session, the pound unexpectedly shot up, updating almost six-month highs by reaching 1.2799. Traders reacted to the publication of the influential British newspaper The Guardian. According to insider sources of the publication, London and Brussels are literally one step away from agreeing on an updated deal. The parties have brought their positions so close that a draft text of the agreement may appear today, October 16.

In other words, traders did indeed have a legitimate hope for a historic deal that would put an end to a period of years of uncertainty. Against such a background, even unconfirmed rumors in this regard provoke strong volatility. But when the first market emotions subsided, a logical question arose: "what's the catch?" After all, just a few weeks ago, the Johnson government and the EU leadership were on opposite sides of the barricades, accusing each other of incompetence. And if the parties found a common denominator, then the negotiators agreed to a certain compromise, and this fact may entail new problems, given the position of the British Parliament under the code name "not one step back."

According to British journalists, London really made significant concessions on the Irish border. First of all, in the field of customs control. According to the concept, the customs border will pass through the Irish Sea, which separates the bulk of Britain from the island of Ireland. In return, Johnson "bargained" for guarantees that the same customs rules would apply in Northern Ireland (which, I recall, is part of the UK), as in the rest of Great Britain.

Some members of the House of Commons had previously stated that they would not approve of the border between the Irish. In particular, the leader of the Democratic Unionist Party, Arlene Foster, said that her political force would not support proposals that would actually "trap" Northern Ireland into the trap of the European Union. According to her, Belfast should not remain within the framework of a single market or the customs union while the rest of the country leaves the regulatory orbit of the EU. In other words, the unionists, who in this composition of the British Parliament are temporary allies of the Conservatives, have already declared their negative position regarding Johnson's deal.

But it is worth noting here that according to the voiced concept, the same customs rules will apply in Northern Ireland as in the whole of Great Britain - and this remark can significantly change the attitude of DUP representatives to the draft deal. Last night, the British press already published information (albeit of an informal nature) that the Unionists would not support Boris Johnson's new deal, "if he makes new concessions regarding Northern Ireland." However, at the moment it is not clear whether we are talking about the already agreed proposals of the British prime minister or those that may still follow.

analytics5da6b07b6becd.jpg

In other words, Johnson will face a difficult battle within the walls of the House of Commons. Indeed, in September, he lost more than 20 "bayonets" of his party members, expelling them from the party for supporting the Brexit deferral bill. Now I am forced to negotiate not only with the "dissidents", but also with the representatives of the Youth Political Party (or seek support among other political groups in the British Parliament). If Johnson is unable to consolidate the deputies, then he is likely to comply with the law and request Brexit postponement, simultaneously initiating early elections in Parliament.

Thus, the pound will respond to the comments of the most influential members of the House of Commons today, evaluating the prospects for approving the deal. If the statements of the MPs will be mostly negative, the GBP/USD pair will be followed by a significant price pullback, right up to the bottom of the 25th figure. If traders see the "light at the end of the tunnel" again, the pound will still conquer the 28th figure: the nearest resistance level is at 1.2870 (the upper line of the Bollinger Bands indicator on the weekly chart).

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

Technical analysis of ETH/USD for 16/10/2019

Crypto Industry News:

The United Arab Emirates Securities and Commodity Office (SCA) has published draft regulations on cryptographic assets.

According to an official statement, SCA will collect public feedback on draft regulations by October 29 before submitting the final draft regulation on the industry.

The Authority noted that all parties involved in the cryptographic industry, including investors, brokers, financial analysts, researchers, the media and others, are invited to provide feedback on the document, adding that the proposals will be considered in the final regulation.

As noted in the statement, the project consists of 28 parts covering all aspects of the cryptographic asset industry in the United Arab Emirates, including token issuer requirements, security and trust policies, investor protection and anti-financial crime measures, information security controls, and management standards technology.

According to the authority, once regulations have been implemented, market participants will be able to ask SCA for guidance on specific parts of the industry and regulatory requirements through the electronic services system.

SCA had already announced plans to introduce ICO regulations in this country by the end of the first quarter of 2019. The office's general director, Obad Al Zaabi, then noticed a significant need for ICO registration and licenses, and local media reported that SCA would work with the stock exchange securities in Abu Dhabi and the Dubai financial market to develop a platform for trading ICO tokens.

Technical Market Overview:

The ETH/USD pair has broken the lower boundary line of the parallel ascending channel and now is testing the level of $176.08. The downside momentum is slightly accelerating which is a not signal for bulls. The key technical resistance is still located at the level of $196.61 and only a clear and dynamic breakout higher will open the road towards the next target at $202.70 and $215.73. If there is no move up back to the channel, then the next target for bears is seen at the level of $163.98.

Weekly Pivot Points:

WR3 - $223.04

WR2 - $209.75

WR1 - $194.13

Weekly Pivot - $180.64

WS1 - $164.92

WS2 - $151.12

WS3 - $135.26

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.

analytics5da6aac455554.jpg

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

Technical analysis of BTC/USD for 16/10/2019

Crypto Industry News:

Tim Draper, a billionaire investor, said he expects Bitcoin - in combination with other technologies - will change the way governments operate around the world.

In a published post on social media, Draper calls Bitcoin the "starting currency" and praises its decentralization and boundless nature, saying that he believes that BTC will unite the world:

"Thanks to Bitcoin and decentralization associated with Bitcoin, geographical boundaries have become less important. We are no longer at the mercy of dictators and paid trolls to develop the global economy. [...] In the long term, I believe that when it comes to business and economy, we are one world more than ever before, "he said.

Draper also accuses those who reject Bitcoin saying he is sticking to tribalism and repeats the belief that "tribalism is dying." He also compares attempts to maintain power to the roar of a falling king:

"Tribalism is dying. And like the roar of the dying king of the jungle, we hear political leaders beating their chest as they try to hold on to the power they once had when the world was only tribal."

Draper also describes the idea of a global health insurance policy - which is more effective and efficient than current offers - "where contributions are in Bitcoins and claims are settled in writing using intelligent contracts and monitored by artificial intelligence."

He also explains his vision of retirement, which does not depend on the decision of political leaders, but "is simply a form of a permanent smart contract."

Technical Market Overview:

The BTC/USD pair has started to test the technical support located at the level of $8,048 after a failed rally towards $9,000. This level is around the middle of the horizontal trading range located between the levels of $8,760 - $7,700, so it is important for bulls to defend it. The momentum is rather flat and the global investors await a clear breakout in either direction. Please notice the larger timeframe trend remains bullish.

Weekly Pivot Points:

WR3 - $9,781

WR2 - $9,248

WR1 - $8,711

Weekly Pivot - $8,198

WS1 - $7,675

WS2 - $7,127

WS3 - $6,590

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.

analytics5da6a93461ed6.jpg

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

Elliott wave analysis of GBP/JPY for October 16 - 2019

analytics5da6a0fa83167.png

GBP/JPY has rallied as we expected and has tested our 139.15 target (the high has been seen at 139.32). Some minor drops may occur. However, another run higher towards 140.06 and maybe even closer to 142.91 (less likely thus) is expected before a minor peak and correction close to 135.67 looks likely.

In the short-term, we see support near 138.00 for the expected rally higher to 140.06. Only a direct break below 137.03 will indicate that the correction to 135.67 is already unfolding.

R3: 141.72

R2: 140.76

R3: 139.81

Pivot: 139.32

S1: 137.96

S2: 137.05

S3: 136.42

Trading recommendation:

We are waiting for GBP from 131.25 and we will move our stop higher to 135.25

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

Technical analysis of GBP/USD for 16/10/2019

Technical market overview:

The GBP/USD pair has made another local high at the level of 1.2798 after the test of the technical support located at the level of 1.2561 was successful. The bullish move up is strong, so now the immediate technical support is seen at the level of 1.2580 - 1.2561. As long as the price is trading above this zone, the chances for another leg up are high. The momentum remains strong and positive, but to reverse the higher timeframe trend the bulls must break through the level of 1.2907.

Weekly Pivot Points:

WR3 - 1.3395

WR2 - 1.3032

WR1 - 1.2877

Weekly Pivot - 1.2532

WS1 - 1.2380

WS2 - 1.2032

WS3 - 1.1859

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 1.2907 and it must be clearly violated. The key long-term technical support is seen at the level of 1.2231 - 1.2224 and the key long-term technical resistance is located at the level of 1.3509. As long as the price is trading below this level, the downtrend continues towards the level of 1.1957 and below.

analytics5da6a762b87b8.jpg

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

Elliott wave analysis of EUR/JPY for October 16 - 2019

analytics5da69e9dd02fa.png

EUR/JPY needed a second corrective dip closer to our ideal target at 119.01. It did not manage to hit this target and bottomed at a low of 119.10 before moving higher again towards the next upside target at 121.93.

That said, we do see some short-term weakness and loss of upside momentum, but key-support at 119.10 should limit the downside and continue to push EUR/JPY higher. It is also important to remember that we are looking for wave three which normally is the longest of the impulsive waves and corrections tend to be sub-normal.

R3: 121.93

R2: 121.14

R1: 120.55

Pivot: 120.00

S1: 119.57

S2: 119.30

S3: 119.10

Trading recommendation:

We are long EUR from 117.25 and we will move our stop higher to 118.55.

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

EUR/USD: plan for the European session on October 16. Eurozone inflation is unlikely to help the euro break above 1.1040

To open long positions on EURUSD you need:

Yesterday's Brexit positive news helped euro buyers regain 1.1005, which limited the downward trend. Today, in the morning, all emphasis will be placed on the consumer price index data in the eurozone. Inflation is expected to be weak, which will force the ECB to continue to keep interest rates at zero. In case it's a good report, the bulls will once again try to break above the resistance of 1.1040, which will be a signal to open long positions in the hope of updating weekly highs in the areas of 1.1075 and 1.1109, where I recommend profit taking. In the scenario of another EUR/USD decline, amid a weak report, it is best to buy the euro only after a false breakdown is formed in the support area of 1.1005, or to rebound from the larger lows of 1.0975 and 1.0943.

To open short positions on EURUSD you need:

The main task of the bears will be the return of EUR/USD to the support of 1.1008, and the breakdown of this level will put new pressure on the euro, which will push the pair to the lows of 1.0975 and 1.0943, where I recommend profit taking. However, everything will depend on the fundamental data on the eurozone and the course of negotiations on Brexit. News that the EU is comfortable with Boris Johnson's plan may again lead to a sharp strengthening of the European currency. Failure to consolidate above the resistance of 1.1040 will be a kind of signal to sell EUR/USD. However, it is best to open short positions immediately on the rebound at a new weekly high in the area of 1.1075.

Signals of indicators:

Moving averages

Trade is conducted in the region of 30 and 50 moving averages, which indicates market uncertainty.

Bollinger bands

In case the euro declines, support will be provided by the lower boundary of the indicator at 1.1005. Break of the upper boundary in the area of 1.1045 may lead to continued growth of the euro.

analytics5da6a89e90685.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 EUR/USD for 16/10/2019

Technical market overview:

The EUR/USD pair has bounced from the key technical support located at the level of 1.0999 (low at the level of 1.0991) as bulls defend this support. Despite the overbought market conditions, the momentum is still strong and positive, so there is still a chance for another upwards move towards the next key technical resistance zone located between the levels of 1.1075 - 1. 1091 and even a possibility of an attack on the swing high at 1.1109. The immediate support is still located at the level of 1.0999. Please remember, that the higher timeframe trend is still bearish.

Weekly Pivot Points:

WR3 - 1.1211

WR2 - 1.1133

WR1 - 1.1093

Weekly Pivot - 1.1014

WS1 - 1.0971

WS2 - 1.0893

WS3 - 1.0849

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.

analytics5da6a5b24d5f5.jpg

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

Technical analysis: Important Intraday Levels For EUR/USD, October 16, 2019

analytics5da6847bab137.jpgWhen the European market opens, some economic data will be released such as Italian Trade Balance, German 30-y Bond Auction, Trade Balance, Final Core CPI y/y, and Final CPI y/y. The US will also publish the economic data such as Beige Book, NAHB Housing Market Index, Retail Sales m/m, and Core Retail Sales 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: 1.1089. Strong Resistance: 1.1083. Original Resistance: 1.1072. Inner Sell Area: 1.1061. Target Inner Area: 1.1035. Inner Buy Area: 1.1009. Original Support: 1.0998. Strong Support: 1.0987. Breakout SELL Level: 1.0981. (Disclaimer)

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

Technical analysis: Important Intraday Levels for USD/JPY, October 16, 2019

analytics5da6840b0d9b9.jpg

In Asia, Japan will not release any economic reports today, but the US will publish some economic data such as Beige Book, NAHB Housing Market Index, Retail Sales m/m, and Core Retail Sales m/m. So, there is a probability that the USD/JPY pair will move with low to medium volatility during this day. TODAY'S TECHNICAL LEVELS: Resistance.

3: 109.24. Resistance. 2:109.03. Resistance. 1:108.81. Support. 1:108.55. Support. 2:108.34. Support. 3:108.12. (Disclaimer)

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

Forecast for EUR/USD on October 16, 2019

EUR/USD

The euro attempted a reversal from technical resistance yesterday, initially falling by 50 points, but later Brexit news returned the price to its original position. This morning, the price is in the Monday range. On the daily chart, the price is completely in a neutral situation - directly on the lines of balance and MACD with the decreasing Marlin indicator in the zone of positive values (meaning the growth trend zone). The price is equally likely to rise to the Fibonacci level of 123.6% at the price of 1.1074 and decrease to the Fibonacci level of 138.2% at the price of 1.0985.

analytics5da6a14a4bb21.png

The four-hour chart also remains neutral - the price is above the lines of balance and MACD, but the Marlin oscillator is trying to return to the "bears" zone.

analytics5da6a1605dfde.png

So, the euro range is represented by the levels of 1.0985 and 1.1074. Moreover, overcoming its upper limit may allow the price to rise to the price channel line at 1.1120, from which a downward reversal is possible, and price consolidation below 1.0985 can develop into a medium-term decline with targets at 1.0845, 1.0785.

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

Control zones GBPUSD 10/16/19

Yesterday, there was a continuation of the growth of the pair, which led to going beyond the monthly control zone of October and the average course of the week. In addition, this indicates an increase in the probability of the formation of corrective movement up to 70%. To enter the sale, the formation of the pattern "false breakdown" of yesterday's maximum is necessary. If this happens, then the first goal of the return will be the upper boundary of monthly control zone 1.2681.

analytics5da6a7bbb22d2.png

Purchases from current levels are not profitable, since the probability of continued growth without the formation of a correction model is 30%.

An alternative growth model will be developed if today's trading closes above yesterday. This will indicate the strength of buyers and the correctional model will be postponed to higher prices. Purchasing outside the upper boundary of the monthly average move is not recommended due to the high probability of a depreciation and return to the monthly range.

analytics5da6a7d63ce50.png

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.

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

Control zones EURUSD 10/16/19

While the pair is in the flat, the main resistance and support levels are weekly extremes. To continue the upward movement, it is necessary to close today's trading above the weekly CZ 1.1055-1.1039. This will determine the following targets. The medium-term growth target will be the monthly control zone of October.

analytics5da6a652117e2.png

Work in the upward direction remains a priority, since there has been no violation of the structure. The probability of a strong fall and the abolition of growth is 30%.

An alternative model of working in the flat will be developed if the pair starts to decline again today and returns to the WCZ 1/2 1.0983-1.0975. This will allow you to get favorable prices to buy after the formation of the false breakout pattern of yesterday's low. The formation of this model can take around one to three days.

analytics5da6a6687e84e.png

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

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

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

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

Forecast for GBP/USD on October 16, 2019

GBP/USD

The British pound grew by 180 points on Tuesday on the news of the practical readiness of the EU and Britain to conclude an agreement on Brexit. It is reported that this is practically the same as Theresa May's proposal, which was rejected several times by Parliament. Today it will be adopted in finalization and the word will once again be in the British Parliament. If the deal is adopted, then we no longer expect strong growth of the British currency.

analytics5da69fa932fb6.png

On the weekly chart, the price has reached the MACD line and the balance line, from which a reversal is planned according to the smaller time frames.

analytics5da69fbf51c12.png

On the daily chart, the price is being traded in the range of Fibonacci levels of 123.6% -110.0%. We are waiting for a correctional decline to the level of 161.8% at the price of 1.2548. The correction looks more complete to the price channel line at 1.2472.

analytics5da6a00425180.png

The oscillator convergence is formed on the four-hour chart. Here, the target level of 1.2472 is confirmed by the MACD line to which it aspires.

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

Forecast for USD/JPY on October 16, 2019

USD/JPY

The yen has practically fulfilled the target level of the embedded line of the red price channel and the risk of a deep correction has appeared. On the daily chart, this risk is expressed by a sign of the formation of divergence on the Marlin oscillator. Divergence can also occur at a higher price, for example, from the boundary with the green price channel (109.70). Growth to this goal is possible after the price consolidates above 108.95. The nearest reduction target is at the line of the red price channel at 108.08.

analytics5da69e433a303.png

On the four-hour chart, the divergence for Marlin is almost ready, but the signal line is still in the growth zone. Support at 108.08 is perhaps the accumulation of new forces for further growth. The price can also make a false breakdown of the red line, here the MACD line is a more important support, the price can meet with it in the region of 107.70.

analytics5da69e58ab514.png

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

NZDUSD poised for a bounce

analytics5da68e99be316.png

ENTRY: 0.62590

61.8% Fibonacci Retracement, 61.8% Fibonacci Extension and graphical swing low

TAKE PROFIT: 0.63190

61.8% Fibonacci Retracement and graphical swing high

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

USDJPY to reach 1st resistance at 108.91, potential to drop!

analytics5da67ea3a0009.png

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

EURUSD approaching resistance, potential drop!

Entry: 1.10609

Why it's good: 78.6% fibonacci retracement, horizontal swing high resistance

Stop Loss : 1.10780

Why it's good : horizontal swing high resistance

Take Profit: 1.10006

Why it's good: horizontal overlap support, 50% fibonacci retracement, 38.2% fibonacci retracement, 100% fibonacci extension

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

Fractal analysis of the main currency pairs for October 16

Forecast for October 6:

Analytical review of currency pairs on the scale of H1:

analytics5da6671eabfa3.png

For the euro / dollar pair, the key levels on the H1 scale are: 1.1091, 1.1069, 1.1058, 1.1039, 1.1000, 1.0986, 1.0966 and 1.0939. Here, we continue to consider the local ascending structure of October 8 as a reference. The continuation of the movement to the top is expected after the breakdown of the level of 1.1039. In this case, the target is 1.1058. Price consolidation is in the range of 1.1058 - 1.1069. We consider the level of 1.1091 to be a potential value for the top; upon reaching this level, we expect a pullback to the bottom.

Short-term downward movement is possibly in the range 1.1000 - 1.0986. The breakdown of the last value will lead to a long correction. Here, the target is 1.0966. This level is a key support for the top. Its passage at the price will lead to the development of a downward movement. In this case, the target is 1.0939.

The main trend is the medium-term upward structure from October 1, the local structure from October 8.

Trading recommendations:

Buy: 1.1040 Take profit: 1.1058

Buy 1.1070 Take profit: 1.1090

Sell: 1.1000 Take profit: 1.0987

Sell: 1.0984 Take profit: 1.0966

analytics5da6673b1ebc4.png

For the pound / dollar pair, the key levels on the H1 scale are: 1.3033, 1.2906, 1.2810, 1.2678, 1.2625 and 1.2532. Here, we are following the development of the upward cycle of October 9. The continuation of the movement to the top is expected after the breakdown of the level of 1.2810. In this case, the target is 1.2906. Price consolidation is near this level. The breakdown of the level of 1.2906 should be accompanied by a pronounced upward movement. Here, the potential target is 1.3033.

Short-term downward movement is expected in the range of 1.2678 - 1.2625. The breakdown of the last value will lead to an in-depth correction. Here, the target is 1.2532. This level is a key support for the top.

The main trend is the upward structure of October 9.

Trading recommendations:

Buy: 1.2810 Take profit: 1.2904

Buy: 1.2908 Take profit: 1.3030

Sell: 1.2678 Take profit: 1.2625

Sell: 1.2623 Take profit: 1.2534

analytics5da667575f734.png

For the dollar / franc pair, the key levels on the H1 scale are: 1.0054, 1.0033, 1.0018, 0.9999, 0.9950, 0.9934, 0.9892 and 0.9872. Here, we are following the ascending structure of October 10. The development of this structure is expected after the breakdown of the level of 0.9999. In this case, the target is -1.0018. Price consolidation is in the range of 1.0018 - 1.0033. For the potential value for the top, we consider the level of 1.0054. Upon reaching which, we expect a pullback to the bottom.

Short-term downward movement, as well as consolidation, are possible in the range 0.9950 - 0.9934. The breakdown of the latter value will favor the development of a downward structure from October 3. In this case, the first goal is 0.9892.

The main trend is the descending structure of October 3, the formation of the potential for the top of October 10.

Trading recommendations:

Buy : 0.9999 Take profit: 1.0018

Buy : 1.0035 Take profit: 1.0054

Sell: 0.9950 Take profit: 0.9936

Sell: 0.9931 Take profit: 0.9894

analytics5da6679c522b9.png

For the dollar / yen pair, the key levels on the scale are : 109.66, 109.33, 108.90, 108.72, 108.24, 108.02 and 107.67. Here, we are following the development of the upward cycle of October 4. Short-term upward movement is expected in the range 108.72 - 108.90. The breakdown of the latter value will lead to a movement to the level of 109.33. Price consolidation is near this level. For the potential value for the top, we consider the level of 109.66. Upon reaching this level, we expect a consolidated movement, as well as a pullback to the bottom.

Short-term downward movement is expected in the range of 108.24 - 108.02. The breakdown of the last value will lead to an in-depth correction. Here, the goal is 107.67. This level is a key support for the top.

The main trend: the upward cycle of October 4.

Trading recommendations:

Buy: 108.90 Take profit: 109.30

Buy : 109.34 Take profit: 109.65

Sell: 108.24 Take profit: 108.03

Sell: 108.00 Take profit: 107.70

analytics5da667b7b7245.png

For the Canadian dollar / US dollar pair, the key levels on the H1 scale are: 1.3251, 1.3223, 1.3209, 1.3177, 1.3223, 1.3251 and 1.3279. Here, we are following the development of the downward cycle of October 10. At the moment, the price is in correction. The continuation of movement to the bottom is expected after the breakdown of the level of 1.3177. In this case, the target is 1.3158. Price consolidation is in range of 1.3158 - 1.3142. For the potential value for the bottom, we consider the level of 1.3107. The movement to which is expected after the breakdown of the level of 1.3140.

Short-term upward movement is possibly in the range of 1.3223 - 1.3251. The breakdown of the latter value will lead to the formation of initial conditions for the upward cycle. In this case, the first potential target is 1.3279.

The main trend is the downward cycle of October 10.

Trading recommendations:

Buy: 1.3226 Take profit: 1.3250

Buy : 1.3253 Take profit: 1.3276

Sell: 1.3177 Take profit: 1.3158

Sell: 1.3140 Take profit: 1.3110

analytics5da667d828978.png

For the Australian dollar / US dollar pair, the key levels on the H1 scale are : 0.6810, 0.6788, 0.6770, 0.6759, 0.6731, 0.6710, 0.6694, 0.6674 and 0.6661. Here, we are following the formation of the descending structure of October 11. The continuation of the movement to the bottom is expected after the breakdown of the level of 0.6730. In this case, the target is 0.6710. Short-term downward movement, as well as consolidation is in the range of 0.6710 - 0.6694. The breakdown of the level of 0.6694 should be accompanied by a pronounced downward movement to the potential target - 0.6674. Price consolidation is in the range of 0.6674 - 0.6661, and from here, we expect a pullback in correction.

Short-term upward movement is possibly in the range of 0.6759 - 0.6770. The breakdown of the latter value will lead to an in-depth correction. Here, the target is 0.6788. This level is a key support for the downward structure. Its passage in price will lead to the development of the upward structure. Here, the first potential target is 0.6810.

The main trend is the formation of the downward movement of October 11.

Trading recommendations:

Buy: 0.6770 Take profit: 0.6786

Buy: 0.6790 Take profit: 0.6810

Sell : 0.6730 Take profit : 0.6710

Sell: 0.6709 Take profit: 0.6696

analytics5da6681fd47c5.png

For the euro / yen pair, the key levels on the H1 scale are: 121.34, 121.03, 120.61, 120.28, 119.92, 119.64, 119.08 and 118.75. Here, the price formed a local structure for the upward movement of October 15. The continuation of the movement to the top is expected after the breakdown of the level of 120.28. In this case, the target is 120.61. Price consolidation is near this level. The breakdown of the level of 120.61 should be accompanied by a pronounced upward movement. Here, the goal is 121.03. For the potential value for the top, we consider the level of 121.34. Upon reaching this level, we expect consolidation, as well as a rollback to the correction.

Short-term downward movement is possibly in the range of 119.92 - 119.64. The breakdown of the last value will have the downward structure formation. Here, the first potential target is 119.08.

The main trend is the local ascending structure of October 15.

Trading recommendations:

Buy: 120.28 Take profit: 120.60

Buy: 120.63 Take profit: 121.00

Sell: 119.90 Take profit: 119.66

Sell: 119.60 Take profit: 119.20

analytics5da6683c9b9c1.png

For the pound / yen pair, the key levels on the H1 scale are : 142.82, 140.89, 139.53, 137.79, 137.08, 136.05 and 135.47. Here, we are following the development of the upward cycle of October 8. The continuation of the movement to the top is expected after the breakdown of the level of 139.55. In this case, the target is 140.89. Price consolidation is near this level. The breakdown of the level of 140.92 will lead to the development of a pronounced movement. In this case, the potential goal is 142.82. Upon reaching which we expect consolidation, as well as a pullback to the bottom.

Short-term downward movement is possibly in the range of 137.79 - 137.08. The breakdown of the last value will lead to a long correction. Here, the target is 136.05. The range 136.05 - 135.47 is the key support for the top.

The main trend is the medium-term upward structure of October 8.

Trading recommendations:

Buy: 139.55 Take profit: 140.85

Buy: 141.00 Take profit: 142.80

Sell: 137.77 Take profit: 137.08

Sell: 137.05 Take profit: 136.05

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

AUD / USD vs USD / CAD vs NZD / USD vs #USDX - DAILY. Comprehensive analysis of movement options from October 16, 2019 APLs

Minor (H4)

"Raw" currencies - a comprehensive analysis of the development options for the movement of AUD / USD vs USD / CAD vs NZD / USD vs #USDX from October 16, 2019 on the Minor operational scale (Daily timeframe).

US dollar Index

The movement of the dollar index #USDX from October 16, 2019 will continue to occur in the 1/2 Median Line channel (98.75 - 98.40 - 98.05) of the Minuette operational scale fork. See the animated chart for details. What will happen next? In case of breakdown of the above levels, we consider the scenario below:

The breakdown of the upper boundary of the 1/2 Median Line channel (resistance level of 98.05) of the Minuette operational scale fork will determine the upward target for the dollar index : the initial line SSL Minuette (99.40) - local maximum 99.67 - control line UTL Minuette (99.85) - warning line UWL 38.2 Minuette (100.45). In contrast, if the lower boundary of the 1/2 Median Line Minuette channel is broken (support level of 98.05), then it will become relevant for the #USDX to reach the boundaries of the equilibrium zone (97.80 - 97.25 - 96.70) of the Minuette operational scale fork with the prospect of reaching thelocal minimum of 95.85.

The markup of #USDX movement options from October 16, 2019 is shown in the animated chart.

analytics5da5e2caaf265.jpg

____________________

Australian dollar vs US dollar

The Australian dollar AUD / USD will continue to develop its movement from October 16, 2019 depending on the development and direction of breakdown of the range:

  • resistance level of 0.6825 (final Shiff Line Minuette operational scale fork);
  • support level of 0.6765 (starting line SSL Minuette operational scale fork).

The breakdown of the SSL start line (support level of 0.6765) of the Minuette operational scale fork will direct the development of the Australian dollar movement to the boundaries of the 1/2 Median Line Minuette channel (0.6680 - 0.6635 - 0.6590) with the possibility of reaching the LTL control line (0.6570) of the Minor operational scale pitchfork.

On the contrary, the breakdown of the final Schiff Line Minuette (resistance level of 0.6825) is a variant of the development of the upward movement of AUD / USD to the boundaries of the 1/2 Median Line channel (0.6850 - 0.6930 - 0.7005) of the Minor operational scale fork and the equilibrium zone (0.6930 - 0.6985 - 0.7040) of the Minuette operational scale fork.

From October 16, 2019, we look at the layout of the AUD / USD movement options in the animated chart.

analytics5da5e2ea1d238.jpg

____________________

New Zealand dollar vs US dollar

The development and direction of the breakdown of the 1/2 Median Line channel (0.6180 - 0.6260 - 0.6340) of the Minor operational scale will determine the development of the movement of the New Zealand dollar NZD / USD from October 16, 2019. The details of the movement within this channel are seen at the animated graphics.

The combined breakdown of the lower boundary of the 1/2 Median Line Minor channel (support level of 0.6120) and the LTL control line (0.6160) of the Minuette operational scale will direct the NZD / USD movement to the boundaries of the equilibrium zone (0.6005 - 0.5905 - 0.5805) Minor operational scale fork.

The breakdown of the upper boundary of the 1/2 Median Line channel (resistance level of 0.6340) of the Minor operational scale forks will determine the development of the movement of the New Zealand dollar to the boundaries of the equilibrium zone (0.6435 - 0.6510 - 0.6580) of the Minuette operational scale forks.

From October 16, 2019, we look at the markup of the NZD / USD movement options in the animated chart.

analytics5da5e30de7116.jpg

____________________

US dollar vs Canadian dollar

In addition, the development of the movement of the Canadian dollar USD / CAD from October 16, 2019 will be due to the development and direction of the breakdown of the boundaries of 1/2 Median Line channel (1.3255 - 1.3185 - 1.3120) of the Minor operational scale fork. The marking of the movement inside this channel is presented in the animated chart.

In case of breakdown of the upper boundary of the 1/2 Median Line channel (resistance level of 1.3255) of the Minor operational scale fork, the upward movement of the Canadian dollar can continue to the targets - the initial SSL line (1.3280) of the Minuette operational scale fork - control line UTL Minuette (1.3320) - local maximum 1.3347 with the prospect of reaching the control line UTL Minor (1.3470).

On the contrary, in case of breakdown of the lower boundary of the 1/2 Median Line channel (1.3120) of the Minor operational scale fork, the development of the USD / CAD movement will continue to the boundaries of the equilibrium zone (1.3015 - 1.2925 - 1.2830) of the Minuette operational scale fork.

From October 16, 2019, we look at the layout of the USD / CAD movement options in the animated chart.

analytics5da5e3473fd3e.jpg

____________________

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 the power coefficients 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.

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

EUR/USD - through thorns to the stars!

Greetings, dear traders. It is time to remember about EUR/USD, which has successfully fulfilled our previous plans. Following GBP/USD, the European currency is now demonstrating a strong bullish direction. It's easy to guess that all these movements are connected with the next portion of news regarding Brexit. If you omit all the fundamental details and focus on how to make money from it, the answer is simple. To take a neat positions in the purchases with a pullback. At the same time, wherever you try to buy, the extreme point of the scenario cancellation is today's minimum at the quote of 1.0991. Therefore, you can limit losses to this level. It is recommended to holding purchases (at least partially) at the level of 1.1064, since this is an important level for sellers over the past few days.

analytics5da5deadccb48.png

I wish you success in trading and big profits!

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

Gold is preparing for the storm

analytics5da65ed6b2a4f.jpg

The yellow metal has always served as a symbol of security, justifying its status as a safe-haven. Until recently, it was used intensively in the market, tossing up new incentives for growth. However, now the situation is changing, and it may not be in favor of precious metals, experts warn.

According to some analysts, a correction has ripened in the gold market, which inevitably occurs after an impressive price growth. The precious metal showed excellent performance, trading at six-year highs, but now there are changes that could lead to its decline. Further dynamics of gold will largely depend on the outcome of trade negotiations between the United States and China and the implementation of the quantitative easing policy (QE) by the Federal Reserve.

A preliminary interim agreement between Washington and Beijing slightly lowered the degree of trade confrontation, which was not slow to affect the cost of precious metals. Reducing tension does not require a premium for geopolitical risk, which was added to the current price of gold. Experts recall that the key driver of growth in the price of precious metals was the trade conflict between the United States and China, the echoes of which affected both Hong Kong and the Middle East.

According to experts, the receipt of new information about a potential trade agreement provokes increased sales in the gold market. However, experts do not expect large-scale liquidation of long positions in gold, rightly believing that so low - less than $1,400 per troy ounce - the price of precious metal may not fall.

Currently, another, more powerful driver for the growth of the precious metals market has loudly announced itself - the Fed's position, which plans to conduct QE. At the same time, the regulator carefully circumvents this term in its statements, focusing on the normalization of the monetary balance. Over the past few months, the Federal Reserve has insisted on reducing its balance to $3.5 trillion, but in September it sharply curtailed this process, not reaching the target level. Recently, Jerome Powell, head of the Fed, announced plans to buy up $75 billion in assets every month, which also could not help but affect the price of gold.

The reason for the sudden changes in the policy of the regulator was a comprehensive panic that gripped the US interbank repo lending market. Recall that last month overnight rates in this market soared to 10% per annum. Experts have recorded a sharp jump in demand for dollar liquidity, which is many times higher than the supply. The central bank had to intervene so that the interbank lending market is not paralyzed, analysts said. They believe that the September surge is the start of a massive panic in the debt market, which is similar to a time bomb.

Statements by the heads of leading central banks add fuel to the fire. For example, Klaas Knot, the head of the central bank of the Netherlands, is certain that in the event of a collapse of the global financial system, it will be gold that will become the basis for its restoration. In the literal and figurative sense, precious metals play the role of a "brick", the building material from which a new system will be formed in the future. The Dutch regulator considers gold an anchor of confidence for the financial mass of the planet. "Precious metal gives confidence in the strength of the balance sheet of the central bank," K. Not said.

In this situation, the yellow metal really became a litmus test, fixing the level of trust in the system. It turns out that the lower this level, the more often there is a desire to withdraw their assets from the banking system. Investors and traders perceive gold as a tool for storing capital outside the system, and the further it is from it, the calmer it is.

This week, experts expect a continuation of the downward trend. The market is bearish. Last week, an entry point for a sell on the rebound formed on the precious metal market. Short positions on gold remain relevant, as long as the market is below the nearest resistance level of the daily timeframe. Large market players are actively selling precious metals. Gold is currently trading near $1,500 per ounce. In the morning, the yellow metal was at $1,499 per ounce.

In the medium term, analysts expect a new phase of strong growth in gold prices. If this scenario is realized in the next 1.5 years, the yellow metal will test the levels of $1900–$2000 per ounce, analysts said.

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