Technical analysis of ETH/USD for 25/10/2019

Crypto Industry News:

According to financial media, none of the 21 founding members of the Libra Association, except Facebook, have yet spent any money to support stablecoin.

Since the Libra Association Council was announced on June 2019, no financing agreement for the founding partners has been concluded so far, inform the media, citing several anonymous sources. With the release of the White Paper, Libra in June, Facebook announced that each of its founding members must make at least a $ 10 million investment to take a stand and ensure council vote.

According to media sources, members did not discuss fees at the Libra Association's first general assembly last week. While the association declined to comment on the matter, the report claims that the project did not receive any financial support from a source other than Facebook itself.

The Libra Association, a non-profit consortium responsible for managing the stablecoin project, organized its inaugural meeting in Geneva on October 14. Originally supported by 28 founding members, Libra has recently lost seven partners, namely PayPal, Visa, Mastercard, Stripe, eBay, Mercado Pago, and Booking, who have decided to leave the consortium.

After these events, David Marcus, head of Calibra's Facebook cryptographic portfolio, said that the withdrawal of seven companies has no effect on the project.

Technical Market Overview:

The ETH/USD pair has made a Pin Bar candlestick pattern at the very end of the recent sell-off towards the level of $152.26. The bulls used this opportunity to bounce a little, but so far were capped below the technical resistance located at the level of $163.11. The momentum has increased slightly to the upside, but the market is still trading below the local technical resistance and below the short-term trendline resistance. In the case of a further slide, the next technical support is located at the level of $147.94.

Weekly Pivot Points:

WR3 - $203.55

WR2 - $195.01

WR1 - $184.09

Weekly Pivot - $175.68

WS1 - $163.10

WS2 - $154.16

WS3 - $142.73

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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Elliott wave analysis of GBP/JPY for October 25 - 2019

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The correction has turned into a more complex structure. However, we need a break below short-term important support at 138.60 to release more downside force towards our ideal target near 135.67 where a new impulsive rally higher towards 144.98 is expected.

We continue to stress that corrections during the third impulsive wave tend to be sub-normal. A break above minor resistance at 140.74 will indicate that the correction in blue wave ii has been completed and the impulsive rally higher has been revived for an increase to at least 144.98 and in the long-term much higher.

R3: 141.51

R2: 141.12

R1: 140.74

Pivot: 140.21

S1: 139.40

S2: 139.07

S3: 138.60

Trading recommendation:

We continue to look for a buying opportunity near 135.75 or upon a break above 140.74.

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Elliott wave analysis of EUR/JPY for October 25 - 2019

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The correction in red wave ii continues to play out as expected. The correction has become more complicated and should eventually move lower to our ideal target at 119.87 before completing the correction and turn back up towards 124.64 and 129.50. In the long term, it is likely to grow higher if strong resistance near 129.50 has been overcome.

In the short-term, a break below minor support at 120.36 should lead to a final dip closer to our ideal target at 119.87 before moving higher again.

R3: 121.47

R2: 121.30

R1: 120.85

Pivot: 120.71

S1: 120.36

S2: 119.87

S3: 119.53

Trading recommendation:

WE are long EUR from 117.25 with our stop placed at 119.00. If you are not long EUR yet, then buy EUR near 120.00 for the next impulsive rally towards 124.64

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Technical analysis of BTC/USD for 25/10/2019

Crypto Industry News:

Kryptoin Investment Advisors based in Delaware has applied to the American Securities and Exchange Commission (SEC) for the launch of a Bitcoin ETF.

According to the filing document published by the SEC, Bitcoin ETF Trust is to be traded on the Arca New York Stock Exchange. This product has been designed to:

"[...] provide Bitcoin exposure at a price that reflects the actual Bitcoin market, where investors can buy and sell Bitcoins, fewer expenses related to Trust," we read.

The company plans to hold Bitcoin and value trust shares in accordance with the Chicago Mercantile Exchange Bitcoin reference rate. The cryptocurrency will be kept by an indefinite insured trustee, who is also regulated by the Investment Advisors Act of 1940.

The SEC documentation also states that Trust will store Bitcoins "to ensure that the Trust stock price reflects the actual Bitcoin market." However, the Trust will not buy or sell Bitcoins directly, but will instead purchase them through actions called "baskets".

Another noteworthy detail is that the head of the Crypto-listed product is Jason Toussaint, former managing director of the World Gold Council and former asset manager of SPDR Gold Shares, one of the largest gold ETFs in the world.

Meanwhile, the race to launch the first regulated Bitcoin ETF is becoming more and more competitive. Earlier this month, documents revealed that the Wilshire Phoenix Fund had updated its own Bitcoin ETF offer to the SEC. Also this month, Bitwise's asset manager with NYSE Arca confirmed his intention to re-apply for an ETF after the last rejection by the SEC.

Technical Market Overview:

The BTC/USD pair is testing the technical resistance located at the level of $7,464 after the sudden drop towards the level of $7,232. The bounce from that level is shallow and clearly corrective in nature, so the short-term downtrend might resume soon again. Nevertheless, in the case of a breakout higher, the next target for bulls is seen at the level of $7,672, which was the previous low of the wave (A).

Weekly Pivot Points:

WR3 - $9,074

WR2 - $8,707

WR1 - $8,444

Weekly Pivot - $8,103

WS1 - $7,849

WS2 - $7,474

WS3 - $7,245

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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Technical analysis of GBP/USD for 25/10/2019

Technical Market Overview:

As anticipated before, any violation of the level of 1.2865 would have likely lead to another leg down to the level of 1.2783 again and this is what the GBP/USD market did. Despite the neutral momentum, the bears are getting more active and try to push the prcies lower towards the next technial support located at the level of 1.2783. The key technical support is still located at the level of 1.2561. The larger timeframe trend remains bearish.

Weekly Pivot Points:

WR3 - 1.3651

WR2 - 1.3325

WR1 - 1.3193

Weekly Pivot - 1.2842

WS1 - 1.2723

WS2 - 1.2355

WS3 - 1.2252

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 1.2999 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.

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Technical analysis of EUR/USD for 25/10/2019

Technical Market Overview:

The EUR/USD pair has tested the local technical sup[port located at the level of 1.1091, but the bounce from this level did not make it over the resistance at the level of 1.1109. The volatility has slightly increased and the bearish activity is more visible. The market is still trading inside of the channel, the momentum is now slightly negative, but there is still a chance for another leg up after the correction is completed. The nearest technical support is seen at the level of 1.1109 and the key technical support is still located at the level of 1.1091.

Weekly Pivot Points:

WR3 - 1.1435

WR2 - 1.1300

WR1 - 1.1250

Weekly Pivot - 1.1120

WS1 - 1.1063

WS2 - 1.0981

WS3 - 1.0893

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 1.0999 and the technical resistance at the level of 1.1267.

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Control zones for EURUSD 10/25/19

Yesterday, the pair reached the defining support zone for WCZ 1/2 1.1100-1.1092. The test of this zone will be decisive for further trading. Since the zone is within the monthly control zone, purchases from its limits are not profitable and it is better to refuse them. The probability of closing trades within the monthly average move is 70%.

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The close of trading this week below the level of 1.1092 will provide an opportunity for repeated sales of the pair on Monday.

An alternative model will be developed if the closure of today's trading occurs above the WCZ 1/2. This will provide an opportunity to sell in the future at a better price. The probability of renewal of the upward movement is below 50%, which does not allow using the test zone to enter the purchase.

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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.

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Control zones for USDJPY 10/25/19

The main support this week was WCZ 1/4 108.44-108.39. It is important to note that at the same levels is the high of September, above which consolidation takes place. If the close of trading this week occurs above the level of 108.49, then purchases will remain a priority in the future

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The formed accumulation zone indicates the need for partial consolidation of purchases at the upper boundary, as its test can lead to the appearance of a large offer.

An alternative model will be developed if the closure of today's trading occurs below the WCZ 1/4. This will allow you to change the vector of trade to a downward one. The target of the bearish model will be WCZ 1/2 107.94-107.85.

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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

GBP/USD: plan for the European session on October 25. Boris Johnson continues political games with the EU and Parliament.

To open long positions on GBP/USD you need:

The pound fell against the US dollar yesterday, as the bulls rushed to take profits after the major growth observed in the past few weeks. However, the decision of the British prime minister to hold a general election on December 12 supported the GBP/USD pair. This was done in order to put pressure on the EU when deciding on a deadline for the UK exit. Bulls need to return to the resistance of 1.2860 today, which will be a signal to open long positions capable of updating highs of 1.2943 and 1.3012, where I recommend profit taking. If the pressure on the pound remains in the first half of the day, then only the formation of a false breakout near the lower boundary of the current correction channel, as well as the support test of 1.2757 will be a signal to open long positions. Otherwise, it is best to buy GBP/USD for a rebound from a low of 1.2664.

To open short positions on GBP/USD you need:

Bears will continue to rely on the EU's intransigence on the issue of postponement, as well as on blocking Johnson's attempt to hold the election on December 12 this year. All this will put pressure on the pound. Therefore, the formation of a false breakout in the resistance area of 1.2860 will be the first signal to open short positions in order to update support in the area of 1.2757, which coincides with the lower boundary of the current correction channel. In case of positive news from the EU, and a breakthrough of resistance at 1.2860, it is best to consider short positions in GBP/USD from larger highs around 1.2943 and 1.3012.

Signals of indicators:

Moving averages

Trading is carried out below 30 and 50 moving average, which indicates a possible continuation of the downward correction.

Bollinger bands

In case the pair falls, a breakthrough of the lower boundary of the indicator in the region of 1.2807 will raise pressure on the pound. Growth will be limited by the upper level of the indicator in the area of 1.2910.

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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: Important Intraday Levels For EUR/USD, October 25, 2019

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When the European market opens, some economic reports will be released such as German Ifo Business Climate and German GfK Consumer Climate. The US will also publish the economic data such as Revised UoM Inflation Expectations and Revised UoM Consumer Sentiment, 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: 1.1158. Strong Resistance: 1.1152. Original Resistance: 1.1141. Inner Sell Area: 1.1130. Target Inner Area: 1.1104. Inner Buy Area: 1.1078. Original Support: 1.1067. Strong Support: 1.1056. Breakout SELL Level: 1.1050. (Disclaimer)The material has been provided by InstaForex Company - www.instaforex.com

EUR/USD: plan for the European session on October 25. US manufacturing activity data and statements by Mario Draghi return

To open long positions on EURUSD you need:

Mario Draghi said yesterday that he was ready to take any measures to stimulate economic growth, which put pressure on the euro, as most likely the regulator will lower rates again at the end of this year. US manufacturing growth supported the dollar. At the moment, the bulls need the formation of a false breakout in the support area of 1.1090, which may coincide with the release of good data from the IFO Institute in Germany. However, return to a resistance of 1.1120 continues to be a more important goal for euro buyers, above which the bulls will pick up the pair, which will make it possible to update highs of 1.1149 and 1.1178, where I recommend profit taking. If pressure on the euro continues, which is also very likely, it is best to open new long positions in EUR/USD by rebounding from a new low of 1.1060.

To open short positions on EURUSD you need:

Sellers will try to take advantage of the weak IFO report on the conditions of the German business environment, and the formation of a false breakout in the resistance area of 1.1120 will be an additional signal to open short positions. The main target of the bears will be the lower boundary of the current descending channel, which coincides with the first support level of 1.1090. A breakthrough in this area will increase pressure on the euro, which will lead the pair to lows in the area of 1.1060 and 1.1026, where I recommend profit taking. If EUR/USD rises above the resistance on the data, it is best to consider short positions from yesterday's resistance of 1.1149, which was formed after a press conference by Mario Draghi.

Moving averages

Trading is conducted below 30 and 50 moving averages, which indicates the preservation of the bearish momentum.

Bollinger bands

If the euro rises in the first half of the day, the upper boundary of the indicator in the 1.1136 area will act as resistance. A break of the lower boundary in the region of 1.1090 will put new pressure on the pair.

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Description of indicators

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

Technical analysis: Important Intraday Levels for USD/JPY, October 25, 2019

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In Asia, Japan will not release any economic reports today, but the US will publish some economic data such as Revised UoM Inflation Expectations and Revised UoM Consumer Sentiment. 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: 109.23.

Resistance. 2: 109.02.

Resistance. 1: 108.80.

Support. 1: 108.55.

Support. 2: 108.34.

Support. 3: 108.12.

(Disclaimer)

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Forecast for EUR/USD on October 25, 2019

EUR/USD

So the last ECB meeting was chaired by Mario Draghi. In the closing speech, he traditionally noted the risks for the eurozone, but stated that the current soft policy mitigates these risks, and also traditionally wished European politicians to strengthen financial integration processes. The speech can be generally called neutral.

European Manufacturing PMI for October did not change: 45.7 against the forecast of 46.1, Services PMI increased from 51.6 to 51.8, the forecast was 51.9. In the US, the data can be called weak: orders for durable goods fell in September by -1.1% (forecast -0.5%), sales of new homes in September showed a figure of 701 thousand compared to the forecast of 710 thousand and the August indicator was lowered from 713 thousand to 706 thousand. US Manufacturing PMI from Markit increased from 51.1 to 51.5 in October, Services PMI grew to the expected 51.0 from September 50.9. The euro closed the day with a decrease of 25 points. Obviously, the second stage of closing positions was taking place on the market simply on the occasion of a farewell speech by Mario Draghi. The first closing day, less voluminous, was on Tuesday.

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On the daily chart, the price worked out the planned Fibonacci level of 110.0% (1.1155) and returned under the blue price channel line. The signal line of the Marlin oscillator is going down steep enough to be a sign of a trend reversal. The immediate goal of 1.1074 is the Fibonacci level of 123.6%. Consolidation under the level (consolidating is necessary, since the level coincides with strong record reversal zones, the closest of which is the middle of September and the third decade of August) will continue to decline to the MACD line in the region of 1.1025.

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On a four-hour chart, the price has consolidated under the indicator lines of balance and MACD, Marlin in the decreasing trend zone. Target levels are marked.

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Forecast for GBP/USD on October 25, 2019

GBP/USD

The pound fell by 63 points due to pressure from the general strengthening of the dollar and the ongoing struggle for Brexit between Boris Johnson and Parliament. The Marlin oscillator is steadily falling, the nearest target at 1.2744 as a Fibonacci level of 123.6% is likely to be achieved soon. At this point, the signal line of the Marlin oscillator can reach the boundary with the territory of the bears. The boundary must be overcome in order to continue the fall. Consolidating the price below the level of 1.2744 and, accordingly, the Marlin oscillator in the negative zone, opens a deeper target at 1.2548 - the Fibonacci level of 161.8%.

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On a four-hour chart, the price has consolidated under the indicator lines of balance and MACD, the Marlin indicator is in the decreasing trend zone. The local trend is down.

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Forecast for AUD/USD on October 25, 2019

AUD/USD

The Australian dollar significantly dropped yesterday under pressure from the US dollar and falling iron ore prices (-1.53%). The aussie received support from the side of the daily balance line. Now the decline may slightly slow down, but the 0.6788 target, as the closest support for one of the lines of price channels, remains. The MACD line moves below the target level.

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The next target at 0.6757 will be achieved with even greater difficulty. The signal line of the Marlin oscillator is close to the transition to the decline zone. The boundary itself is also the resistance to a downward trend.

On a four-hour chart, the price is below the balance lines and MACD, while Marlin in the negative zone. At the moment, the bears are defeating the bulls.

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AUDUSD approaching resistance, potential big drop coming!

Entry: 0.68307

Why is it good: Previous breakout level, horizontal pullback resistance

Take Profit: 0.68012

Why is it good: horizontal pullback support, 38.2% fibonacci retracement, 100% fibonacci extension

Stop loss: 0.68492

Why is it good: 50% fibonacci retracement

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EUR/USD appraoching resistance, potential for big drop!

Entry: 1.11079

Why it's good : Horizontal pullback resistance, previous breakout level

Take Profit : 1.10626

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

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EUR/USD. October 24. Results of the day. The final speech of Mario Draghi as ECB chairman pulled down the euro

4-hour timeframe

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Amplitude of the last 5 days (high-low): 75p - 56p - 41p - 39p - 34p.

Average volatility over the past 5 days: 49p (average).

The penultimate trading day of the week was in more active trading than the first three. There is nothing surprising in this, as there were plenty of macroeconomic reports and events today. Below we will consider them in detail. Now we can say that the bears went on the attack, as they received the most compelling reasons for this at the US trading session. Thus, the chances of a resumption of the downward trend have significantly grown on Thursday, and the euro/dollar pair itself has already fallen 65 points from the high of the day.

All the first three days we just did what we wrote about the upcoming ECB meeting, about the whole package of various macroeconomic reports on Thursday. This Thursday has arrived, and there really is something to analyze. It all started with the publication of business activity indexes in Germany and the European Union. Without going into too much detail, we'll immediately say that all six indices turned out to be worse than forecasted values, although five out of six indices showed improvement compared to the previous month. However, this improvement doesn't mean much and certainly does not add optimism to traders, since the most significant and expected business activity indexes in the EU and Germany production again failed miserably, amounting to 45.7 and 41.9. Recall that any value below 50.0 represents an industry decline. Thus, it is easy to guess in what condition the industry of both the "locomotive of the European Union" and the European Union itself is in. On this news, traders have already begun to gradually get rid of the euro currency, although during the day there was also an increase in the euro/dollar pair.

Then came the time to announce the results of the meeting of the European Central Bank. There were no surprises. The lending rate remained at the level of 0.0%, and the deposit rate - at the level of -0.5%. Such figures could not provoke a serious change in price, and traders calmly accepted the absence of changes. The most interesting event was certainly the speech of the ECB President Mario Draghi, who is completing his 8-year cycle of government. From November 1, his place will be taken by Christine Lagarde, who previously held the post of head of the IMF. What did Draghi say? By and large, nothing new. Yes, he could not say anything new; there were no grounds for this and global changes in the economy or geopolitical situation. Draghi reiterated weak inflation and that the regulator will do everything in his power to increase it. He noted a weak economy, clearly in need of stimulation. Once again, he complained about the increased risks of protectionism policies, alluding to Trump's activities and complete uncertainty with Brexit. Thus, at his last meeting, Mario Draghi did not express himself "softly," leaving Christine Lagarde to further developments. Draghi said everything as it is. His speech caused a sell-off of the European currency. In fact, traders heard a clear hint in Draghi's speech that the rate could be lowered again. This "one more time" may come very soon. The regulator clearly decided to postpone a similar decision, since the announced program of quantitative easing will begin to operate only in November, and before stimulating the economy again, you must at least wait for the first results of the QE program . As for the prospects for the European currency, they are again bearish, as traders again saw how bad everything is in the European Union. Now the bulls hope will be associated only with the Federal Reserve meeting, at which Jerome Powell may not put off the ballot and announce the third consecutive reduction in the key rate. This could save the European currency from updating two-year lows.

To top it off, the United States released indicators of changes in the volume of orders for durable goods and business activity indices in the Markit industries and services. What can I say? All 4 indicators of orders for durable goods were significantly worse than forecasts and August values. The reduction of the main indicator was 1.1% in September, excluding transport - 0.3% of losses, excluding defense orders - a decrease of 1.2%, excluding defense and aviation - a decrease of 0.5%.

Macroeconomic statistics from the United States continues to disappoint, which increases the chances of another easing of the Fed's monetary policy. Well, at the very end, preliminary values of business activity indices in the US for October came out. All three indicators exceeded the previous values, however, these data were clearly lost against the background of all the previous events of Wednesday and there was no reaction to them.

The technical picture was on the side of the bulls on Wednesday. Draghi's speech made adjustments to the plans of traders and now we expect a fall to the support level of 1.1050, where a strong support line for the Ichimoku indicator - Senkou Span B. also passes nearby. Overcoming these two supports will show that the bears are really ready for new feats and will move the pair down at least until the Fed meeting. If the Fed does not lower the rate, this will be another bearish factor for the euro/dollar pair.

24-hour timeframe

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The price hit the Senkou Span B line, and if there is no sharp pullback, then most likely this line will be overcome. But a rebound from it can play in favor of the euro and its long-term prospects. At least in this case, we can expect an upward movement to the resistance level of 1.1190, and on the 4-hour timeframe - consolidation above the Kijun-sen line, which will return the bulls to the game.

Trading recommendations:

EUR/USD continues to be adjusted, however, in the coming days, a downward trend may resume. We do not recommend selling the pair yet, as the sell signal from Ichimoku is very weak, and trading was held on emotions. On Friday, market participants will calm down, the volatility will slightly decrease, and it will be possible to draw conclusions about the movement of the pair on Thursday in a more relaxed atmosphere. However, formally, shorts are now relevant with goals of 1.1079 and 1.1050. Returning to euro purchases is now recommended no earlier than the reverse crossing the critical line with the target of 1.1230.

Explanation of the illustration:

Explanation of the illustration:

Ichimoku indicator:

Tenkan-sen is the red line.

Kijun-sen is the blue line.

Senkou Span A - light brown dotted line.

Senkou Span B - light purple dashed line.

Chikou Span - green line.

Bollinger Bands Indicator:

3 yellow lines.

MACD indicator:

Red line and bar graph with white bars in the indicator window.

Support / Resistance Classic Levels:

Red and gray dotted lines with price symbols.

Pivot Level:

Yellow solid line.

Volatility Support / Resistance Levels:

Gray dotted lines without price designations.

Possible price movement options:

Red and green arrows.

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Fractal analysis of the main currency pairs for October 25

Forecast for October 25:

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: 1.1223, 1.1181, 1.1158, 1.1138, 1.1122, 1.1103, 1.1083, 1.1068 and 1.1049. Here, the price forms a pronounced structure for the downward movement of October 21. The continuation of the movement to the bottom is expected after the breakdown of the level of 1.1103. In this case, the target is 1.1083. Price consolidation is in the range of 1.1083 - 1.1068 For the potential value for the bottom, we consider the level of 1.1049. Upon reaching which, we expect a pullback to the top.

Short-term upward movement is expected in the range 1.1122 - 1.1138. The breakdown of the latter value will lead to an in-depth correction. Here, the target is 1.1158. This level is a key support for the downward structure.

The main trend is the descending structure of October 21.

Trading recommendations:

Buy: 1.1122 Take profit: 1.1136

Buy: 1.1140 Take profit: 1.1156

Sell: 1.1103 Take profit: 1.1083

Sell: 1.1068 Take profit: 1.1050

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For the pound / dollar pair, the key levels on the H1 scale are: 1.3215, 1.3141, 1.3033, 1.2939, 1.2810, 1.2734 and 1.2625. Here, we are following the development of the upward cycle of October 9. At the moment, the price has expressed a pronounced potential for the downward movement of October 21. The continuation of the movement to the top is expected after the breakdown of the level of 1.2959. In this case, the first target is 1.3035. The breakdown of the level of 1.3035 will lead to a pronounced upward movement. Here, the potential target is 1.3141. Price consolidation is in the range of 1.3141 - 1.3215.

We expect consolidated movement in the range of 1.2877 - 1.2810. The breakdown of the last value will lead to an in-depth correction. Here, the target is 1.2715. This level is a key support for the top. Its breakdown will lead to the formation of potential for the downward cycle. Here, the goal is 1.2625.

The main trend is the ascending structure of October 9, the formation of the descending structure of October 21.

Trading recommendations:

Buy: 1.2960 Take profit: 1.3031

Buy: 1.3035 Take profit: 1.3140

Sell: 1.2808 Take profit: 1.2717

Sell: 1.2713 Take profit: 1.2627

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For the dollar / franc pair, the key levels on the H1 scale are: 0.9999, 0.9976, 0.9963, 0.9943, 0.9929, 0.9909, 0.9898 and 0.9878. Here, we are following the development of the ascending structure of October 18. Short-term upward movement is expected in the range 0.9929 - 0.9943. The breakdown of the last value will lead to pronounced movement. Here, the target is 0.9963. Short-term upward movement, as well as consolidation is in the range of 0.9963 - 0.9976. For the potential value for the top, we consider the level of 0.9999. Upon reaching this value, we expect a rollback to the bottom.

Short-term downward movement is possibly in the range of 0.9909 - 0.9898. The breakdown of the latter value will lead to an in-depth correction. Here, the target is 0.9878. This level is a key support for the upward structure.

The main trend is the upward structure of October 18.

Trading recommendations:

Buy : 0.9930 Take profit: 0.9943

Buy : 0.9945 Take profit: 0.9963

Sell: 0.9909 Take profit: 0.9900

Sell: 0.9896 Take profit: 0.9878

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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.

Main trend: local structure for the top of October 23.

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

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For the Canadian dollar / US dollar pair, the key levels on the H1 scale are: 1.3160, 1.3128, 1.3101, 1.3073, 1.3036 and 1.2989. Here, we consider the descending structure of October 10 as a medium-term initial condition. The continuation of movement to the bottom is expected after the breakdown of the level of 1.3073. In this case, the target is 1.3036. Price consolidation is near this level. For the potential value for the bottom, we consider the level of 1.2989. Upon reaching this level, we expect a pullback to the top.

Short-term upward movement is possibly in the range of 1.3101 - 1.3128. The breakdown of the latter value will lead to an in-depth correction. Here, the target is 1.3160. This level is a key support for the downward structure.

The main trend is the downward cycle of October 10.

Trading recommendations:

Buy: 1.3101 Take profit: 1.3126

Buy : 1.3130 Take profit: 1.3160

Sell: 1.3073 Take profit: 1.3038

Sell: 1.3034 Take profit: 1.3000

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For the Australian dollar / US dollar pair, the key levels on the H1 scale are : 0.6933, 0.6901, 0.6886, 0.6856, 0.6836, 0.6794, 0.6781, 0.6752 and 0.6722. Here, we are following the descending structure of October 22. At the moment, we expect to reach the level of 0.6794. Price consolidation is in the range of 0.6794 - 0.6781. The breakdown of the level of 0.6780 will lead to a pronounced movement. Here, the target is 0.6752. Price consolidation is near this level, and there is also a high probability of a rollback to the top. For the potential value for the bottom, we consider the level of 0.6722. Upon reaching which, we expect a departure in the correction.

Short-term upward movement is possibly in the range of 0.6836 - 0.6856. The breakdown of the latter value will favor the formation of an ascending structure. Here, the potential target is 0.6886.

The main trend is the descending structure of October 22.

Trading recommendations:

Buy: 0.6836 Take profit: 0.6854

Buy: 0.6858 Take profit: 0.6886

Sell : 0.6780 Take profit : 0.6752

Sell: 0.6750 Take profit: 0.6724

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For the euro / yen pair, the key levels on the H1 scale are: 121.95, 121.79, 121.34, 121.03, 120.61, 120.28, 119.92 and 119.64. Here, we are following the development of the local ascendant structure of October 15. Short-term upward movement is expected in the range 121.03 - 121.34. The breakdown of the level of 121.35 should be accompanied by a pronounced upward movement. Here, the target is 121.79. Price consolidation is in the range of 121.79 - 121.95. From here, we expect a correction.

Short-term downward movement is possibly in the range of 120.61 - 120.28. The breakdown of the last value will lead to an in-depth correction. Here, the goal is 119.92. This level is a key support for the top. Its passage at the price will lead to the formation of initial conditions for the downward cycle. In this case, the first goal - 119.64.

The main trend is the upward structure of October 15.

Trading recommendations:

Buy: 121.05 Take profit: 121.34

Buy: 121.36 Take profit: 121.76

Sell: 120.60 Take profit: 120.33

Sell: 120.25 Take profit: 119.94

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For the pound / yen pair, the key levels on the H1 scale are : 142.82, 141.23, 139.53, 138.70, 137.79 and 137.08. Here, we are following the development of the upward cycle of October 8. The continuation of movement to the top is expected after the breakdown of the level of 141.23. In this case, the potential target 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 139.53 - 138.70. The breakdown of the last value will lead to a long correction. Here, the target is 137.79. The range of 137.79 - 137.08 is the key support for the top.

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

Trading recommendations:

Buy: Take profit:

Buy: 141.25 Take profit: 142.80

Sell: 139.50 Take profit: 138.75

Sell: 138.65 Take profit: 137.80

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

AUD / USD vs USD / CAD vs NZD / USD vs #USDX (H4). Comprehensive analysis of movement options from October 25, 2019 APLs

Minuette (H4)

Here's a comprehensive analysis of the development options for the movement AUD / USD vs USD / CAD vs NZD / USD vs #USDX from October 25, 2019 on the Minuette operational scale forks (H4 time frame)

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US dollar Index

The movement of the dollar index #USDX from October 25, 2019 will be due to the development and range breakdown direction :

  • resistance level of 97.65 on the Median Line Minuette operational scale forks;
  • support level of 97.40 on the boundary of the red zone of the Minuette operational scale forks.

Now, in case that the Median Line Minuette breaks down (resistance level of 97.65), the dollar index price may continue to rise towards the targets - the upper boundary of the ISL38.2 (98.05) equilibrium zone of the Minuette operational scale forks - the final Schiff Line Minuette (98.20) - the equilibrium zone (98.25 - 98.50 - 98.95) of the Minuette operational scale forks.

Consecutive breakdown of support levels :

- 97.40 (the boundary of the red zone of the Minuette operational scale forks);

- 97.25(lower boundary of the ISL61.8 equilibrium zone of the Minuette operational scale forks);

- 97.20 (start line SSL of the Minuette operational scale forks);

- 97.15 (local minimum);

will make the continuation of the downward movement of #USDX to the control LTL (97.00) and warning - LWL38.2 (96.70) - LWL61.8 (96.35) - to the lines of the Minuette operational scale forks relevant.

The markup of #USDX movement options from October 25, 2019 is shown in the animated chart.

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Australian dollar vs US dollar

The development of the movement of the Australian dollar AUD / USD on October 25, 2019 will depend on the development and direction of the breakdown of the boundaries of the equilibrium zone (0.6825 - 0.6860 - 0.6890) of the Minuette operational scale forks. The details of the development of the boundaries of this equilibrium zone are presented in the animated chart.

The breakdown of the lower boundary of ISL38.2 (support level of 0.6825) of the equilibrium zone of the Minuette operational scale forks - continuation of the development of the downward movement of the Australian dollar to the a Median Line channel (0.6800 - 0.6775 - 0.6750) and equilibrium zones (0.6755 - 0.6720 - 0.6685) of the Minuette operational scale forks.

In the case of combined breakdown of resistance levels :

- 0.6890 (the upper boundary of ISL61.8, the equilibrium zone of the Minuette operational scale forks);

- 0.6896 (local maximum);

The upward movement of AUD / USD can be continued to the final line FSL (0.6995) Minuette operational scale forks.

From October 25, 2019, we look at the layout of the AUD / USD movement options in the animated chart.

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New Zealand dollar vs US dollar

From October 25, 2019, the development of the movement of the New Zealand dollar NZD / USD will be determined by the development and direction of the breakdown of the boundaries of the equilibrium zone (0.6388 - 0.6430 - 0.6465) of the Minuette operational scale forks. The marking of the development of the above levels is shown in the animated chart.

The breakdown of the lower boundary of ISL38.2 (support level of 0.6388) of the equilibrium zone of the Minuette operational scale forks - an option to continue the downward movement of the New Zealand dollar to the targets - 1/2 Median Line Minuette (0.6365) - the final Schiff Line Minuette (0.6350) - the lower boundary of the 1/2 Median Line Minuette channel (0.6315) - the initial SSL line (0.6280) Minuette operational scale forks.

On the contrary, if the upper boundary of ISL61.8 (resistance level of 0.6465) is broken, the equilibrium zone of the Minuette operational scale forks will confirm that further the development of the NZD / USD movement which will occur within the boundaries of the equilibrium zone (0.6435 - 0.6505 - 0.6575) of the Minuette operational scale forks.

The marking options NZD / USD from October 25, 2019 can be seen in the animated chart.

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US dollar vs Canadian dollar

The development of the movement of the Canadian dollar USD / CAD from October 25, 2019 will be due to the development and direction of the breakdown of the range:

  • resistance level of 1.3110 (upper boundary of the 1/2 Median Line channel of the Minuette);
  • support level of 1.3065 - local minimum (control line LTL Minuette operational scale forks).

Consecutive breakdown of support levels :

- 1.3065 (control line LTL Minuette operating scale forks);

- 1.3055 (1/2 Median Line Minuette);

will determine the continuation of the downward movement of the Canadian dollar to the lower boundary of the 1/2 Median Line Minuette channel (1.3000) and the upper boundary of ISL38.2 (1.2880) the equilibrium zone of the Minuette operational scale forks.

In case of combined breakdown, the resistance level is :

- 1.3110 (the upper boundary of the 1/2 Median Line Minuette channel);

- 1.3120 (start line SSL of the Minuette operational scale forks);

the upward movement of USD / CAD can continue to the boundaries of the 1/2 Median Line channel (1.3160 - 1.3190 - 1.3220) and the equilibrium zone (1.3190 - 1.3230 - 1.3270) of the Minuette operating scale forks.

From October 25, 2019, we look at the layout of the USD / CAD movement options in the animated chart.

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

The formula for calculating the dollar index:

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

where 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

Necessary as air: gold is an indispensable attribute of any portfolio

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The market has never questioned the importance of gold. The yellow metal is considered one of the key components of any trader's investment portfolio. However, the current year clearly indicated the high demand and importance of precious metals.

According to the observations of several analysts, gold was on a pedestal in 2019. It has become one of the most important assets. Confirmation of this is the sharply increased price of precious metals. Analysts consider the current policy of world central banks aimed at a total reduction in interest rates to be the reason for this price spurt. The global market is periodically storming, which worries investors who are fleeing into defensive assets. The main safe haven asset is still considered to be gold, which is time-tested.

Many experts conclude that at the moment the precious metal has become a mandatory attribute of any investment portfolio. This point of view is held by the leading currency strategist Peter Grosskopf. He emphasizes that this year gold has won the lion's share of the market and is not going to stop there. Both world central banks and large investors are actively building up gold reserves, the analyst notes.

Last month, the yellow metal reached a six-year high amid growing demand for defensive assets. The reasons for this, experts consider the reduction in interest rates by the Federal Reserve and the appeal of world regulators to super-soft monetary policy. According to analysts, this triggered a rapid increase in investments in exchange-traded funds secured by gold. "Soft monetary policy, as well as negative interest rates, do not stimulate economic activity so that the economic growth rate of countries exceeds the growth rate of debt," P. Grosskopf notes. According to the expert, the Federal Reserve put a check and check in this game, and gold entered the arena, which is now an obligatory portfolio asset.

Over the past few months, the value of the yellow metal has shown impressive growth, and silver has followed up. In 2019, the price of gold increased by 16%. In the first month of autumn, the precious metal reached $1,557 per ounce, which is the limit since 2013. On Wednesday, October 23, immediate-delivery gold futures were trading near $1,492 per ounce. On Thursday morning, October 24, the price of the yellow metal did not rise above $1,494 per ounce.

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Precious metal market experts draw attention to the strong correlation of the European currency with gold and silver. They fear a bullish rally in emerging stock markets, as investors can start selling precious metals in this case. This could trigger a drop in the price of gold and the European currency, analysts said. Over the past two weeks, the yellow metal has consolidated at a strong record resistance level of $1,490 per ounce, which until recently acted as a support. At the moment, the asset is trading within the range of $1491– $1492 per ounce, maintaining its gained position and confidently making its way to the next peaks.

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This year has become a litmus test for the global economy, analysts said. The danger of the onset of the economic crisis came close, and the strong depreciation of fiat currencies became apparent. The current strategy of central banks has created a false idea of successfully overcoming the crisis, but now this soap bubble is ready to burst. According to analysts, the time has come for real assets, namely gold and silver. Their monetary value will play a key role in the coming years, they said. The debt burden in the global economy will continue to grow, and this will provide significant support to precious metals. Gold and silver will become alternative currencies for a wide range of investors, analysts summarize.

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

EUR/USD: farewell song of the ECB president, or why you should buy the euro

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Today will be the last ECB meeting on monetary policy, chaired by Mario Draghi.

"The ECB is ready to do everything necessary to protect the euro" - these words made in 2012 will go down in history, becoming the cultural heritage of the retiring head of the ECB on October 31.

"At that time - in the summer of 2012 - there was a huge systemic risk. Draghi saved not only European sovereign governments, but all European banks, especially given that they are linked like dominoes through interbank overnight lending. In legacy, Draghi is passing on a much healthier financial system with very affordable rates and balanced programs to continue to drive activity and consumer spending, " said Mondher Bettaib of Vontobel Asset Management.

The head of the ECB, indeed, skillfully managed financial markets, but left his post in a difficult time for Europe. Germany is on the verge of a recession, inflation in the EU has slowed to 0.8%, Brexit's fate is still unsettled, and a more serious trade war could erupt between Washington and Brussels than between the United States and China, given the impressive volume of US exports to Europe.

Thus, seeing Super Mario as President of the ECB are, on the one hand, under a storm of applause, and on the other, against the backdrop of increasing criticism of the regulator's last steps.

Skeptics argue that lowering the ECB's deposit rate by 10 basis points, to -0.5%, will hit depositors even more.

95% of analysts recently surveyed by Bloomberg do not believe that the revival of European QE in the amount of €2.6 trillion will help the region's economy.

At the September meeting of the Governing Council of the ECB, representatives of Germany, the Netherlands, France and Austria openly opposed certain elements of the new stimulus package. Recently, some of them have made it clear that they are ready to abandon claims due to the fact that from November the ECB will have a new chairman - Christine Lagarde. However, experts warn that public opposition to the decisions of the regulator weakens confidence in it and may complicate the task of the next head of the ECB if necessary to mitigate monetary policy in the future.

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It is expected that at the upcoming meeting, Draghi will speak in support of the September stimulus package and may even attempt to defend all the measures taken during his tenure at the head of the ECB, drawing attention to the following points: the fall in borrowing costs to record low levels, the weakening of political risks of peripheral eurozone countries, a strong labor market and growing confidence in the euro.

In addition, Draghi can once again emphasize the need to ease the fiscal policy of the eurozone countries.

However, the transfer of the ECB Chairman of his former merits, the protection of the revival of QE and calls to national governments may not provide adequate support to the bears on EUR/USD.

Oxford Economics experts believe that after the announcement of a large-scale monetary stimulus in September, the ECB does not have any opportunity to make serious decisions in October.

ABN Amro predicts that the regulator will reduce the rate on deposits to -0.6% in December, and from March will increase the scale of purchases of assets under QE, but few are of this opinion.

BNP Paribas believes that in the coming months the ECB will operate in autopilot mode, as the Governing Council collects data on how the decisions already made by the regulator work in practice.

It is possible that the ECB monetary expansion has reached its limit, while the Federal Reserve, according to the consensus forecast of Reuters analysts, will lower the rate on federal funds in October this year and early next year.

75% of more than 100 Reuters respondents believe that trade conflicts will push the US economy into a recession, the chances of which within 12 and 24 months are estimated at 35% and 45%, respectively. According to analysts, trade relations between the United States and China are developing according to the "one step forward, two steps backward" scenario. Despite the fact that the parties have concluded a truce, more imports are currently under tariffs than three months ago.

The wider (in comparison with the ECB) space for the Fed's monetary expansion, the US economy is beginning to feel negative from trade disputes, as well as the hope that it will be possible to avoid a "hard" Brexit, are pushing the EUR/USD rate up.

Thus, the press conference of Mario Draghi following the October meeting of the Governing Council of the ECB could be a good opportunity to buy the single European currency with a target of $1.1215 and $1.1270.

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

Forecast of EURUSD ahead of ECB and Fed meetings

Key central banks will hold their meetings on Thursday, October 24, and Wednesday, 29 and 30, which will determine the dynamics of financial markets for at least the next one and a half to two months, and maybe in the longer term. Given these important events, from the point of view of trading in the foreign exchange market, we need to make assumptions cleared of information noise, and then look at how our assumptions worked out in reality. In other words, we need to create an algorithm of actions and make changes to it in accordance with newly emerging circumstances.

However, why did I need to mark up a roadmap before and not after the event has already happened? There are a number of reasons for this, and first of all, my deep conviction that in the current situation, meetings of central banks will only confirm decisions already made earlier. Surprises are possible only from the Fed, but this seems unlikely. Therefore, while there are still some doubts regarding the actions of the Open Market Committee, I personally have no doubts about the actions of the European Central Bank.

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First of all, traders should know that, according to the regulations, the ECB never comments on or regulates the euro or, at least, declares it in words. However, one must be very naive to assume the detachment of the regulator in the fate of the exchange rate of the currency accountable to him. In words, the Fed and the ECB pursue an independent monetary policy, but the ability to create surplus value from the issue of money helps maintain the high standards of life for the "golden billion".

Therefore, it's impossible for me to imagine that the change in exchange rates has been let off by gravity of key central banks. Well, if Russia holds consultations with OPEC countries to limit oil production and thus regulates the price, then the countries that are members of the North Atlantic alliance have been doing this for a long time and quite successfully, but with regard to money. Having in its hands a tool that controls 90 percent of the world's money circulation, it is a sin not to use this tool.

So, what do we currently know about the policy of central banks? The European Central Bank maintains a refinancing rate of 0% and re-launched a large-scale asset purchase program worth €20 billion per month, and did so simultaneously with new long-term refinancing programs, which should not only increase the availability of liquidity in the European market, but also stimulate the development of the European economics. According to many experts, this should serve to weaken the euro, but did it?

Having been hit by a liquidity crisis in the repurchase market that erupted in September, the Fed, under the formal pretext of increasing reserves of commercial banks, was forced to adopt an urgent program for the purchase of short-term bills of the US government totaling $65 billion per month. This at least equalizes the chances of the dollar in the competition of printing presses, if it does not increase its advantage. However, the truth is that the quantitative easing policy does not affect the exchange rate, at least to the extent that we would like to. You can see the evidence on the chart (Fig. 1), which shows the dynamics of the trade-weighted US dollar index calculated by the Fed based on the results of trade with leading world currencies.

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Figure 1: Relationship between US Fed assets and the trade-weighted dollar index. Source - Federal Reserve Bank of St. Louis

Indeed, there are periods on the chart when the dollar depreciated with an increase in the Fed balance, but there are periods when everything happened exactly the opposite. A similar picture can be obtained by comparing the euro and the change in the balance sheet of the European Central Bank. The connection between the exchange rate and the balance sheet of the central bank may exist, but it is certainly not so primitive that we could calculate it using simple methods.

When assessing the prospects for exchange rates, one should rather be guided by dynamic changes in the interest rate differential in the EURUSD rate, an assessment of the yield of treasury instruments with the same maturity, inflation potential, growth prospects for prices of major commodity assets, positioning of leading traders in the futures market, and seasonal factors. You and I can try to evaluate something, but most of the factors will remain unknown to us. At the same time, trading in exchange rates is doing so in probability, and the more facts we can evaluate, the higher the probability of success for the transactions we make. The main thing in these factors then is not to get confused.

If we talk about the dynamic prospects of rates, then the advantage here is on the side of the euro. The ECB is in no hurry to make a refinancing rate below zero, and Mario Draghi, as a downed pilot, is rather concerned about how he can eject a golden parachute. He did everything he could, which at least presupposes a period of some stability in the policy of the regulator.

In turn, since July of this year, the US Federal Reserve lowered the federal funds rate by half a percent, from 2.25 to 1.75, meaning the lower limit of the range established by the Open Markets Committee. Today, 94% of traders believe that the Fed will go for another rate cut in 6 days, dropping it to the level of 1.50-1.75 percent. A decrease in differential by 0.75% over three months is a serious decrease in the possibility of earning by arbitrage operations. Therefore, it is not surprising that from the beginning of August, that is, from the moment the Fed rate was lowered, institutional investors gradually refused to place investments in US dollars.

During this time, the long positions of institutional management funds (Asset Manager) lost about a tenth, while euro sales by this category of traders in the futures market, on the contrary, increased. At the same time, asset managers have been the main buyers of the euro in the futures market since 2016, which was due to their hedging a short position in the cash market that accompanies transactions in investments in higher-yield dollar instruments.

Actually, the question now is not whether there will be a reversal of the downward trend in euros, but when it will happen. Last week ended with serious technical signs of breaking the fundamental trend on the EURUSD course. However, the reversal is not yet over, and its formation may last another one or two months, which is fraught for us with problems associated with the formation of a new direction, and the meetings of central banks that we will see in the near future may accelerate or may slow down the formation of the reversal. However, the probability of a EURUSD rate reversal is becoming more and more every day, take this into account when opening your positions.

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