Technical analysis of GBP/USD for 27/12/2019:

Technical Market Overview:

The GBP/USD pair rally bounced from the technical support located at the level of 1.2904 but is still trading inside of a narrow channel. The bulls have managed to break through the short-term descending trendline resistance around the level of 1.2970 and clearly want to continue the move up. Moreover, the market is bounced from the oversold conditions and the momentum just broke through the fifty levels, which means the move up might get some steam. The next target for bulls is seen at the level of 1.3039 and 1.3101. The immediate support is seen at the level of 1.3012, 1.2988 and 1.2962.

Weekly Pivot Points:

WR3 - 1.3654

WR2 - 1.3526

WR1 - 1.3206

Weekly Pivot - 1.3091

WS1 - 1.2763

WS2 - 1.2640

WS3 - 1.2325

Trading Recommendations:

The best strategy for current market conditions is to trade with the larger timeframe trend, which is up. All downward moves will be treated as local corrections in the uptrend. In order to reverse the trend from up to down, the key level for bulls is seen at 1.2756 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.

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Main events of the coming year that will have an impact on world markets (we consider it possible to sell gold and USD/CAD

The main events of the outgoing year, which had a significant impact on world financial markets, were the trade confrontation between America and China, the situation around Britain's exit from the European Union and the monetary policies of the world's largest central banks.

These events were really the main ones and conducted the markets to the full. Of course, the results are necessarily summed up at the end of the outgoing year, but the most important thing is to identify or highlight the important topics of the coming year, which will highly affect the mood of market players and the dynamics of financial instruments.

The first and foremost remains the situation with trade negotiations between Washington and Beijing. The signing of the "1st phase" of a new trade agreement does not solve all the problems, but only a part of them. Therefore, the further success of their resolution will be in the focus of the markets. Under the influence of this topic, the volatility of all financial markets can significantly increase without exception.

On the other hand, the problem of UK exit from the EU is supposed to be completed on January 31. However, there is a risk which is quite high, that this Brexit epic may drag on, but in our opinion, at least for the first quarter of the new 2020. But unfortunately, the problems of the divorce of Britain and the EU, from which the negative impact of this event on the economies of continental Europe and "foggy Albion" will have a significant impact on the exchange rates of the euro and sterling for a long time to come even if everything is resolved.

Now, let's move to the issue of monetary policies of the largest world Central Banks. We expect them to remain soft and super soft. The Fed will pause the decision on rates, which may support the exchange rate of the American currency, especially against the euro. The ECB, most likely in the wake of Brexit, as well as the weakness of the European economy, will still expand incentive measures, which will weaken the single currency. In turn, sterling will fully depend on the situation with Brexit and its consequences. On the other hand, the Japanese yen will continue to be held hostage to its function of a safe haven currency, as will the Swiss franc. Commodity and commodity currencies will depend entirely on the situation around the Washington-Beijing trade negotiations, which will also have a significant impact on the dynamics of crude oil prices while stocks markets are likely to remain in favor, primarily due to the soft monetary policies of the world's Central banks.

Another event will not pass the markets - this is the election of a new US president. The tense struggle between D. Trump and the Democratic Party will only escalate, which could cause market unrest. Therefore, in general, we believe that nothing catastrophic will happen in the global economy.

Forecast of the day:

The USD/CAD pair is trading above the level of 1.3100. Thus, we consider it possible to sell it after crossing this level with the target of 1.3060 in the wake of an increase in crude oil prices.

Gold quotes could not break through the strong resistance level of 1516.00. We consider it possible to sell it with a likely reduction in price to 1500.00, and then to 1491.00, which will correspond to Fibonacci retracements of 23% and 38%.

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Technical analysis of EUR/USD for 27/12/2019:

Technical Market Overview:

The EUR/USD pair has bounced strongly from the 61% Fibonacci retracement on 20th December and keeps going higher. The first rally has been capped around the level of 1.1096, but after some struggle, the bulls have managed to continue to rally higher and are currently trying to hit the level of 1.1144, which is the next target for them (it is a technical resistance for the price as well). Any breakout above this level might lead to the old trendline test, but to do this the bulls would have to break through the technical resistance located at the levels of 1.1167 and 1.1179. Although the higher timeframes trend remains bearish, the global investors must take into account, that the EUR/USD might be finally breaking up from the multi-month Ending Diagonal pattern.

Weekly Pivot Points:

WR3 - 1.1242

WR2 - 1.1207

WR1 - 1.1132

Weekly Pivot - 1.1099

WS1 - 1.1021

WS2 - 1.0984

WS3 - 1.0910

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 1.1040 and the technical resistance at the level of 1.1267.

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USD/JPY and EUR/USD: Yen will continue its decline against the US dollar on the background of possible measures to stimulate

Euro strengthened slightly against the US dollar. Yesterday's data showing that the number of Americans who applied for unemployment benefits decreased for the first time, did not affect the market significantly. Also, the report from the US Department of Labor is incomplete, as it is characterized by increased volatility between Thanksgiving and mid-January next year. However, even without these data, it is clear that the American labor market is in full order, gradually making its way to its historical lows.

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According to the report, for the week of December 15 to 21, the number of initial applications for unemployment benefits fell by 13,000 and amounted to 222,000. Economists have expected this number of initial applications to be at 220,000 only. Meanwhile, as for the revised data for the week of December 8 to 14, the number of initial applications increased by 1,000, and amounted to 235,000.

In total, the moving average of applications for four weeks rose by 2,250 and amounted to 228,000.

As for the figure on the secondary number of applications for unemployment benefits, which are Americans who remain out of work for more than a week, for the week from December 8 to 14, it fell by 6,000 as well, and amounted to 1.72 million.

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Other important fundamental data were not released on Thursday. This led to a reduction in traders' long positions in the US dollar, enabling risky assets to strengthen slightly by the end of this week.

As for the technical picture of the EUR/USD pair, at the moment, the upward correction in euro may continue. This will lead to an update of the highs at 1.1130 and 1.1160. Without a good fundamental recharge, breaking above these levels is unlikely. If the pressure on risky assets returns, with such a thin market in pre-holiday days, it is quite possible, without the publication of statistics, that the pair will be supported by a minimum of 1.1070. A larger area is seen as well around 1.1040.

USD/JPY

The Japanese yen strengthened against the US dollar after data that the core consumer price index (CPI) in Tokyo rose to 0.8% year-on-year in December. Economists had expected the figure to be at 0.6% only. As for inflation, taking into account the volatile categories, the Tokyo CPI in December was at 0.9% per annum, compared to November this year where it remained unchanged.

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Yen was also supported by the unemployment rate data in Japan, which fell to 2.2% in November, returning to the lows of the year. Economists had expected it to remain at 2.4%. The ratio of jobs to job seekers in Japan in November is 1.57, as compared to 1.57 in October.

The real problems with the rising inflation in Japan remain even amidst such low unemployment and interest rates. Let me remind you that just recently, Bank of Japan Governor Haruhiko Kuroda said that if there are minimal signs of slowing the movement of inflation, he would not hesitate to resort on lowering interest rates and additional measures to ease monetary policy. Apparently, today's data indicate the continuation of a wait-and-see position on the part of the regulator, which will support the yen in the future.

Meanwhile, the annual drop in retail sales in Japan, as well as the reduction in industrial production, is unlikely to add optimism to traders who bet on the strengthening of yen in the short term. According to the data, sales in Japan decreased by 2.1% in November this year, as compared to the same period in 2018. Industrial production also decreased by 4.5% in November, as compared to October, while economists had predicted a fall of only -1.2%.

In general, the weakening of the Japanese yen and the upward trend of the US dollar, which was formed at the end of this summer, remains. While the pair is in a narrow side channel of 109.30-109.70, we can expect a breakthrough on the upper border, and a new wave of growth on the trading instrument in the area of highs 110.00 and 110.60. Breaking the lower limit of this range will push the dollar back to the support of 108.50

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Positivity continues to dominate the markets, NZD and AUD will try to continue growth

Markets continue to win back the positives associated with the signing of the first phase of a trade deal between the US and China and rising expectations for a global economic recovery. On Thursday, US stock indices updated historical records again. At the same time, the S&P 500 closed at 3239.91 and a rise in commodity prices was recorded on Friday morning. Brent surpassed the level of 68 dollars per barrel in anticipation of increased consumption.

Moreover, additional positive growth was ensured by the passage through Congress of a bill on government financing in 2020. Now, given that there is no deterioration in employment rates and consumer confidence has stabilized at high levels, it can be assumed that the risks have decreased, which means that some positivity will dominate during that time.

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US dollar declines against most G10 currencies, while commodity currencies are especially confident. At the same time, there is still no serious reason to believe that the peak of the crisis is over - the growth in consumer activity by the end of the year is quite explained by seasonality, while the Brexit factors and the US-China deal have no clear prospects. The risk of breaking the agreement is real, although the key contradictions have not been resolved.

Forecasts for bet are neutral. On the one hand, a three-fold reduction in the rate this year has brought an additional impulse to the US economy. Thus, it is unlikely that the Fed will continue to lower the rate in the face of lower risks. On the other hand, the probability of a rate increase is even less, as inflationary expectations remain depressed.

As a result, the most likely scenario in the currency exchange market in the coming days is the development of current trends. The threat of sudden changes in sentiment is low.

NZD/USD

The NZIER Institute in a quarterly study of the state of the New Zealand economy worsened forecasts for most parameters when compared with September. NZIER expects not only a slowdown in GDP growth, but also a decrease in investment in business, a slowdown in exports, housing. However, inflation is forecasted to be positive only in the coming months, after which it will move down from the target levels of RBNZ. Therefore, a worsening labor market and a slowdown in wage growth are also expected.

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The question of the RBNZ rate remains open. After an unexpected reduction in August, bets immediately went by 50p. As a result, RBNZ in November did not take any steps and took a break. In fact, the Central Bank was forced to act faster than the markets expected. These steps led to a positive impact on the economy - mortgage rates fell, which led to an increase in housing construction and household expenses.

Meanwhile, ANZ Bank also adheres to a close assessment, which predicts that the RBNZ will be forced to recognize the negative dynamics in inflation by May and will lower the rate again.

As a result, the forecast for TWI (NZD trade-weighted rate) for the coming months is positive, but it looks worse since spring than in September. This means that kiwi is close to the exhaustion of momentum, and thus, the factors that led to an increase in NZD in October-December are weakening.

Growth may continue if markets rely on continued global economic recovery, but such a scenario is unlikely. Resistance 0.6790 is reachable, however, the formation of the top and the closure of long positions will most likely begin near this level. On the other hand, closer is the resistance 0.6710 / 25. This is most likely the boundary of the growth of NZD in the current impulse.

AUD/USD

The Australian dollar has been steadily adding in recent days. The growth is steady, because it relies not only on positive changes in the external background, but also on its own domestic economic factors. Moreover, Australian currency received a strong impulse on December 19 after the publication of the employment report, which turned out to be noticeably better than expected in most parameters.

At the same time, a strong labor market gives the RBA reason to hold a pause in monetary policy, rising commodity prices and lowering tension support commodity currencies. Technically, AUD continues to implement the impulse, testing of the upper border of the channel 0.6975 / 80 is expected, after which either a correctional decline to supports 0.6927 or 0.6870 / 80 or a breakthrough of the channel will follow.

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Trading plan on EUR/USD for December 27, 2019

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The market remains very thin as most of the inhabitants of the West are celebrating the Christmas holidays.

There is also almost no news. The US market showed new highs on the first day of trading after Christmas, however, I still believe that the US market expects a strong correction in January.

Nevertheless, the first movements after Christmas are very interesting, because they can show us the mood of the market without significant participation of speculative interest.

EUR/USD: the sellers' attack on euro has ran out. There was no attempt to break down the important levels of 1.1065 and 1.1035.

On the contrary, the euro broke through the resistance at 1.1100.

Further purchases are possible at a break of 1.1200 and up.

Alternative: in the case of a downward reversal, sell from 1.1065.

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Indicator analysis: Daily review on GBP / USD for December 27

Trend analysis (Fig. 1).

On Friday, the price can continue the pullback upward movement with the target of 1.3050, a pullback level of 23.6% presented in a blue dashed line. If this line is reached, continue to work upward with the next target 1.3139 which is a retracement level of 38.2% presented in a blue dashed line.

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Fig. 1 (daily chart).

Comprehensive analysis:

- Indicator analysis - up;

- Fibonacci levels - up;

- Volumes - up;

- Candlestick analysis - up;

- Trend analysis - up;

- Bollinger Lines - down;

- Weekly schedule - up.

General conclusion:

Today, the price may continue to move up.

Another scenario is unlikely, but a different scenario is possible where from a retracement level of 14.6% which is equivalent to 1.2995 presented in a blue dashed line, work down, with a target of 1.2905 the lower fractal presented in a blue dashed line.

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Indicator analysis: Daily review on EUR / USD for December 27

Trend analysis (Fig. 1).

On Friday, the price may continue to move up with the first target of 1.1128, the historical resistance level presented in a blue dashed line. If you reach this level, continue to work up.

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Fig. 1 (daily chart).

Comprehensive analysis:

- Indicator analysis - up;

- Fibonacci levels - up;

- Volumes - up;

- Candlestick analysis - up;

- Trend analysis - up;

- Bollinger Lines - up;

- Weekly schedule - up.

General conclusion:

An upward trend is possible today.

There is an unlikely, but quite possible scenario where from a pullback level of 38.2% which is equivalent to 1.1117 presented in a red dashed line, the price goes down to the lower target of 1.1067, the lower fractal presented in a red dashed line.

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EUR/USD approaching resistance, potential drop!

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Trading Recommendation

Entry: 1.11104

Reason for Entry:

Horizontal overlap resistance, 38.2% Fibonacci retracement, 78.6% Fibonacci extension

Take Profit : 1.10667

Reason for Take Profit: horizontal swing low support, 61.8% Fibonacci retracement

Stop Loss: 1.11541

Reason for Stop loss:

Horizontal swing high resistance, 61.8% Fibonacci retracement

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GBP/JPY approaching resistance, potential drop!

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Trading Recommendation

Entry: 142.875

Reason for Entry: breakout level

Take Profit : 1.27253

Reason for Take Profit:

38.2% Fibonacci retracement, horizontal swing low support

Stop Loss: 144.223

Reason for Stop loss:

Horizontal swing high resistance, 61.8% Fibonacci retracement

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USD/CAD testing support. Bounce expected!

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Trading Recommendation

Entry: 1.31

Reason for Entry: 78.6% Fibonacci retracement, 100% Fibonacci extension, horizontal overlap support

Take Profit : 1.31684

Reason for Take Profit: 38.2% Fibonacci retracement

Stop Loss: 1.30431

Reason for Stop loss:

Horizontal swing low

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Technical analysis: Important Intraday Levels For EUR/USD, December 27, 2019

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When the European market opens, no economic reports will be released, while the US will publish some economic data such as Crude Oil Inventories and Natural Gas Storage, 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: 1.1156. Strong Resistance: 1.1150. Original Resistance: 1.1139. Inner Sell Area: 1.1128. Target Inner Area: 1.1102. Inner Buy Area: 1.1076. Original Support: 1.1065. Strong Support: 1.1054. Breakout SELL Level: 1.1048. (Disclaimer)The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis: Important Intraday Levels for USD/JPY, December 27, 2019

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In Asia, Japan will release the Retail Sales y/y, Prelim Industrial Production m/m, Unemployment Rate, and Tokyo Core CPI y/y. The US will also publish some economic data such as Crude Oil Inventories and Natural Gas Storage. 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 : 110.06.

Resistance. 2: 109.84.

Resistance. 1: 109.60.

Support. 1: 109.39.

Support. 2: 109.15.

Support. 3: 108.93.

(Disclaimer)

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GBP/USD: plan for the European session on December 27. Pound is trying to recover, but so far there are very few willing

To open long positions on GBP/USD you need:

Yesterday, the bulls made another attempt to break the resistance of 1.3000, but this did not lead to anything good. Only a new level at 1.3018 was formed, which now represents the main problem for buyers of the pound. Only after consolidating above this range will it be possible to speak about the continuation of the upward trend already in the area of highs 1.3074 and 1.3128, where I recommend taking profits. If the bulls fail to cope with resistance of 1.3018, and by analogy with yesterday, after updating the highs of the day, return to the area below 1.3018, in which case I recommend postponing long positions until the support test of 1.2966, subject to the formation of a false breakout, but buy GBP/USD immediately on a rebound from a low of 1.2904.

To open short positions on GBP/USD you need:

Sellers are also not in a hurry to return to the market and use only false breakouts after updating daily highs. I also recommend acting today. Failure to consolidate above 1.3018 will be the first signal to open short positions in GBP/USD, and the closest target for sellers will be the support of 1.2966. However, it will be possible to talk about the resumption of the downward trend only after a breakout and consolidation below this level, which will raise the pressure on the pair and lead to a decrease in the support area of 1.2904, which coincides with the low of this week. Breakout of this range will push the pair to December lows in the area of 1.2831 and 1.2767, where I recommend taking profits. In the scenario of a pound growth above the resistance of 1.3018 in the first half of the day, it is best to consider new short positions in the pair for a rebound from the highs of 1.3074 and 1.3128.

Signals of indicators:

Moving averages

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

Bollinger bands

A break of the lower boundary of the indicator at 1.2966 will raise pressure on the pound. Growth above the upper boundary of the indicator in the area of 1.3018 will lead to new purchases.

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Description of indicators

  • Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.
  • Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.
  • MACD indicator (Moving Average Convergence / Divergence - moving average convergence / divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9
  • Bollinger Bands (Bollinger Bands). Period 20
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EUR/USD: plan for the European session on December 27. Bulls need to protect support at 1.1095

To open long positions on EURUSD you need:

Buyers of the euro coped with the task yesterday, and despite the fact that data on the US labor market came out according to the forecast of economists, where the number of initial applications for unemployment benefits increased by 222,000, they continued to push the pair above the level of 1.1095. At the moment, all emphasis is on this range, but already as support. The formation of a false breakout there will be a signal to open long positions in the continuation of the upward correction to the area of highs 1.1129 and 1.1172, where I recommend taking profits. However, given the lack of important fundamental data in the morning, in addition to the publication of an economic bulletin from the European Central Bank, the lack of activity at the level of 1.1095 may lead to the pair returning to the area of a low of 1.1069, where I recommend opening long positions immediately for a rebound.

To open short positions on EURUSD you need:

Sellers need to regain the level of 1.1095, which they tried to protect all this week. Only a decrease below this range will increase the pressure on the pair and lead to a downward correction to the support area of 1.1069, a breakthrough of which will provide the bears with a direct path to the lows of 1.1041 and 1.1004, where I recommend taking profit there. If there is no pressure on the euro in the first half of the day and the upward correction continues, short positions can be returned from the level of 1.1129, subject to the formation of a false breakout there. But I recommend selling the pair immediately for a rebound only in the resistance area of 1.1172, the test of which will indicate the formation of a new upward trend in the euro.

Signals of indicators:

Moving averages

Trade is conducted slightly above 30 and 50 moving averages, which indicates that it is possible for the euro to grow in the short term.

Bollinger bands

If the pair decreases, support will be provided by the lower boundary of the indicator in the region of 1.1080.

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Description of indicators

  • Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.
  • Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.
  • MACD indicator (Moving Average Convergence / Divergence - moving average convergence / divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9
  • Bollinger Bands (Bollinger Bands). Period 20
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Forecast for EUR/USD on December 26, 2019

EUR/USD

The dollar is in no hurry to breakthrough in the foreign exchange market, probably leaving decisive action in the early days of the new year. Today, the euro enjoys easing and continues to correct. The first barrier to this growth is the MACD line on a four-hour chart at a price level of 1.1120.

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Overcoming this resistance may extend growth to the top of December 19 at the price of 1.1144. The signal line of the Marlin oscillator is in the growth zone, but has penetrated into this zone along a gentle trajectory, which warns of a weak trend.

After the correction is completed, we are waiting for the price to fall to support the embedded line of the price channel on the daily chart, in the area of 1.1056. When the price exits below the MACD line (1.1036), this will signal a medium-term decline in the euro.

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The Marlin oscillator slightly rises after the market, its positive reading is weak, consolidation in the growth zone has not yet occurred.

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Forecast for GBP/USD on December 27, 2019

GBP/USD

On Thursday, the British pound slightly grew (32 pp), taking advantage of the general weakening of the dollar (-0.09%). The MACD line on the daily chart (1.3010) acts as a growth limiter. In the main scenario, a pound reversal for a further decline can occur today. The target until the end of the year is the Fibonacci level of 138.2% at a price of 1.2820. The Marlin oscillator is in the decreasing trend zone.

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On the four-hour chart, yesterday's growth was delayed by the balance line indicator. Here, the probability of continued correctional growth to the Fibonacci level of 23.6% (1.3049) or even to the MACD line at the price of 1.3095 is manifested here. But if the price lingers at current levels until tonight, the signal line of the Marlin oscillator, already showing the intention to turn down, could be in the zone of negative numbers, and then continued growth will have low chances.

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Forecast for AUD/USD on December 27, 2019

AUD/USD

The Australian dollar showed strong growth yesterday, supported by the growth of oil and gold: oil grew by 1.01%, gold by 0.73%. However, the growth occurred at the lowest daily volumes for the last 12 months, that is, even less than the Christmas period last year, according to the Marlin oscillator, a reversal divergence is being prepared - the price yield over the embedded price channel line can already be determined as false.

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With the price leaving yesterday's low, the 0.6846 target opens - the point of coincidence of the MACD line with the underlying embedded line of the price channel.

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On the four-hour chart, the main support is the MACD line (0.6915). Consolidating the price below it can strengthen the aussie's decline.

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Comprehensive analysis of movement options of #USDX vs AUD/USD vs USD/CAD vs NZD/USD (H4) on December 27

Minuette operational scale (H4)

It is already the end of year 2019 - what will happen next with the raw materials instruments? Here's a comprehensive analysis of the development options for the movement #USDX vs AUD / USD vs USD / CAD vs NZD / USD from December 27, 2019.

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US dollar index

The development of the movement of the dollar index #USDX from December 27, 2019 will be due to the development and direction of the breakdown of the range:

  • resistance level of 97.68 (the upper boundary of ISL61.8 is the equilibrium zone of of the Minuette operational scale forks);
  • support level of 97.55 (lower boundary of the ISL38.2 equilibrium zone of the Minuette operational scale forks).

The breakdown of the resistance level of 97.68 at the upper boundary ISL61.8 of the equilibrium zone of the Minuette operational scale forks will determine the further development of the #USDX movement in the equilibrium zone (97.55 - 97.82 - 98.08) of the of the Minuette operational scale forks with the prospect of reaching the final Schiff Line Minuette (98.22) and the final line FSL Minuette (98.38).

On the contrary, the breakdown of the lower boundary of the ISL38.2 channel of the equilibrium zone of the Minuette operational scale forks (support level of 97.55) - an option to return the development of the movement of the dollar index within the boundaries of the equilibrium zone (97.68 - 97.45 - 97.22) of the Minuette operational scale forks with the prospect of reaching the boundaries 1/2 Median Line Minuette channel (96.87 - 96.70 - 96.50).

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

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Australian dollar vs US dollar

The movement of the Australian dollar AUD / USD from December 27, 2019 will also occur depending on the development and the direction of breakdown of a narrow range:

  • resistance level of 0.6930 (the lower boundary of the 1/2 Median Line channel of the Minuette operational scale forks);
  • support level of 0.6925 (the lower boundary of the channel 1/2 Median Line of the Minuette operational scale forks).

In the event of a breakdown of the support level of 0.6925, the development of the Australian dollar will begin to flow again in the 1/2 Median Line (0.6925 - 0.6900 - 0.6875) of the Minuette operational scale forks with the prospect of reaching the SSL Minuette start line (0.6855).

On the other hand, in case of breakdown of the resistance level 0.6930 - it will lead to an option for the development of the AUD / USD movement in the 1/2 Median Line channel (0.6930 - 0.6945 - 0.6960) of the Minuette operational scale forks with prospect. Now, after the breakdown of the above levels of this channel - the price of the instrument will try to reach the boundaries of the equilibrium zone (0.6965 - 0.7000 - 0.7040) of the Minuette operational scale forks.

We look at the layout of the AUD / USD movement options on the animated chart from December 27, 2019.

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US dollar vs Canadian dollar

Te development of the USD / CAD movement, respectively from December 27, 2019, will be determined by the development and direction of the breakdown of the levels boundaries (1.3130 - 1.3165 - 1.3200) of this channel - traffic marking inside the 1/2 Median Line Minuette channel is presented on the animated chart.

The breakdown of the upper boundary of the 1/2 Median Line channel (resistance level of 1.3200) of the Minuette operational scale forks will confirm the development of the upward movement of the Canadian dollar to the equilibrium zone (1.3245 - 1.3265 - 1.3290) of the Minuette operational scale forks.

In case of breakdown of the lower boundary of the 1/2 Median Line Minuette channel (support level of 1.3130) and the local minimum 1.3102 is updated, the downward movement of USD / CAD will be directed to the equilibrium zone (1.3015 - 1.2970 - 1.2925) of the Minuette operational scale forks.

We look at the markup of the USD / CAD movement options on the animated chart from December 27, 2019.

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New Zealand Dollar vs US Dollar

New Zealand Dollar in the range:

  • resistance level of 0.6685 (control line UTL of the Minuette operational scale forks);
  • support level of 0.6640 (the initial line of SSL of the Minuette operational scale forks).

The breakdown of the support level 0.6560 (the initial SSL Minuette line) - the development of the NZD / USD movement will be directed to the boundaries of the 1/2 Median Line channel (0.6620 - 0.6600 - 0.6580) of the Minuette operational scale forks and the equilibrium zones of the Minuette operational scale forks (0.6590 - 0.6525 - 0.6450) and Minuette (0.6525 - 0.6492 - 0.6455).

Meanwhile, the breakdown of the control line of the pitchfork UTL operational scale Minuette (resistance level of 0.6685) will make possible the development of the movement of the New Zealand dollar to levels of resistance:

- 0.6695 - warning line UWL38.2 of the Minuette operational scale fork;

- 0.6735 - warning line UWL61.8 of the Minuette operational scale forks;

- 0.6790 - warning line UWL100.0 of the Minuette operational scale forks.

We look at the layout of the NZD / USD movement options on the animated chart from December 27, 2019.

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The review was prepared 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

USD/JPY: Kuroda's usual concern, Trump's optimism and general risk appetite

Christmas Eve, Christmas Day, Boxing Day, St. Stephen's Day - the foreign exchange market continues to trade amid low liquidity. Only Japan has a peculiar role as a news provider, influencing the yen accordingly. The Japanese currency also reacts more actively to the external fundamental background - at least in comparison with other currencies of the major group. The increased risk appetite against the backdrop of a dovish speech by the head of the Bank of Japan helped the bulls of the USD/JPY pair rise by several dozen points. Nevertheless, the pair remained in the price range of 109.00-109.90, within which it has been trading for almost two weeks. To break out of this price range, bulls or bears of the pair need a more compelling information event - either from the Japanese regulator or from China/US.

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Today, the head of the Japanese central bank Haruhiko Kuroda made a speech at the annual meeting of representatives of the Nippon Keidanren Business Federation. He reiterated his thesis that the regulator "without hesitation" will resort to additional measures to mitigate monetary policy if the momentum of inflationary growth fades. It is worth noting here that inflation in Japan shows an extremely weak, but still growth: the November consumer price index reached 0.5% (in annual terms), while this figure could only increase to 0.2% in October. On a monthly basis, inflation in November grew by a modest 0.2%. The consumer price index excluding the cost of fresh food (the main indicator for the Japanese regulator) in November increased by 0.4% year on year after rising 0.2% in September. In general, this dynamics did not come as a surprise to most experts - the indicator came out at the forecast level.

Weak but stable inflationary growth allows the Bank of Japan to maintain a wait-and-see attitude - the latest meetings are held in a verbal setting mode, which everyone has become accustomed to by and large. Kuroda has repeatedly shown readiness for action, but does not mean the "red lines" at the intersection of which the Bank of Japan will move from words to deeds. So far, the head of the Japanese regulator is trying to influence the situation using slightly different methods.

For example, at today's meeting, he called on major Japanese employers to increase the payroll for their employees. According to him, this will help increase consumer demand and accelerate inflation. On the one hand, this is just a recommendation from the head of the central bank. But on the other hand, it is worth considering the specifics of the relationship between Japanese business and the banking regulator. As we know, Japan is a country of financial conglomerates, industrial giants and other large holdings. Their impact on the country's economy is very significant. Kuroda several years ago already resorted to such requests, but then they could not get the situation off the ground. Now the situation is repeating itself - apparently, the head of the central bank considers the interest rate cut as a necessary measure. Despite the threats of the dovish nature voiced today, he voiced an optimistic assessment of global economic prospects. This suggests that the de facto Japanese regulator in the foreseeable future will maintain a wait-and-see attitude.

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Despite the contradictory results of today's speech by Kuroda, the yen lost ground with the dollar. The Japanese currency is weakening amid a general risk appetite. Let me remind you that just recently - at the beginning of this week - relations between the United States and China again worsened, against the background of Trump's signing of the military budget for next year. This document includes the provision of military assistance to Taiwan, and the provision of support to Hong Kong protesters. The Chinese were outraged by this state of affairs, since they consider these territories part of their country. A spokesman for the Chinese Foreign Ministry threatened the United States with almost a cold war if the intentions declared by the Americans were implemented. After that, the dollar slowed down, especially against the backdrop of weak data on the volume of orders for durable goods (the only significant release this week).

But then Donald Trump tweaked the fundamental picture with his tweets - he announced that "in the near future" the ceremony of signing the first phase of the trade transaction will take place. According to preliminary data, this will happen in January, after the 86-page text of the agreement is translated and finally agreed. Trump said that next year he will "meet" with the Chinese leader, although the procedure for signing the first part of the deal will be at the ministerial level. Nevertheless, the optimistic mood of the US president encouraged dollar bulls, while interest in the yen (as a defensive asset) declined throughout the market.

Tokyo's consumer price index will be published tomorrow in Japan. This indicator is considered a leading indicator for price dynamics across the country. In normal times, this index is ignored by the market, but against the background of an almost empty economic calendar, traders can turn their attention to it. According to the general forecast, the index should demonstrate positive dynamics (growth up to 0.9%). Otherwise, the USD/JPY pair will continue its upward dynamics, at least up to the resistance level of 109.90 - this is the upper line of the Bollinger Bands indicator on the daily chart.

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

Trading idea for natural gas on 2020 of the 3rd millennium

Good evening, dear traders. Merry Christmas and a Happy New Year to all Catholics!

The market is relatively quiet. Some instruments were opened with gaps after yesterday's Christmas, while some have not been opened so far. This is normal. Thus, you must understand that this happens every year, as inevitably as the seasons change. Moreover, Forex is an interbank market, and, as you know, not a single bank will carry out serious large operations at this time. This time is characterized by low interest and liquidity. This means that you should not rely on objective medium-term trends in the currency exchange market at this time. However, the movements can vary, and more so, very sharp and often unpredictable, which then explain everything with reduced liquidity. Against this background, I recommend reducing sales volumes before the start of the year, as well as paying attention to NG natural gas.

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Gas is traded at the lows of the year near the historical low of 2016. If you want to build a long-term idea for the purchase of one of the most popular energy resources on the planet, you should pay attention to this from the point of view of the investor. Nevertheless, few people know that the currency market has one of the lowest gas swaps:

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In addition, even if they can not be paid by using accounts without charging swaps - they can do another option which is by putting only one checkmark when opening an account.

The trading idea for the purchase of natural gas can be implemented by a network of limit purchases in the range shown in the first figure. Holding a position can be from several months to a year. Therefore, this idea can bring good and stable returns at the investment level.

Good luck in trading!

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

Christmas debts on euro. Trading idea for the EUR/USD pair

The EUR/USD pair, which is the most popular trading instrument among currency traders, left a good three-day trading floor for December lows after the decline on December 20, thereby indicating the risk level of sellers in this zone. Indeed, if you imagine that, for example, the last 3 days you have been buying euros against the US dollar, then the most likely scenario will be the placement of a stop order exactly at the level of 1.1066. In my opinion, this is a classic trap.

Thus, the hunt for this level is declared! Today is not closed yet, but in the case of closing the American session in the red - you can develop in the sell with take-down at the stop level of buyers 1.10663.

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From the point of view of Price Action, I recommend waiting for the close of the day, and if it ends with a D1 pin-bar, you can rely on it in sales for the specified target.

Have a successful trading and control the risks!

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

EUR/USD: will 2020 be favorable for the dollar or the euro

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As the western world moves away from Christmas, experts continue to evaluate the prospects for EUR/USD in 2020.

According to a consensus forecast of analysts recently surveyed by Bloomberg, the euro will rise against the US dollar to $1.16 by the end of 2020.

It is assumed that the loss of investor interest in US stocks amid a slowdown in the US economy, lack of support from the Federal Reserve's monetary expansion and overbought S&P 500 will expand capital flows. They will flow from the US to the EU. Hints of this have already appeared in the fourth quarter. For the first time since the middle of last year, the net demand for ETFs oriented to European securities entered the positive zone.

In 2019, the S&P 500 index increased by more than 28%, which is near the levels of 2013 (+29.6%) and 1997 (+31%). However, history shows that the next year, after such an impressive rally, the stock index usually lost ground and increased only by 6.6% on average. On the one hand, the loss of investor interest in American securities is an important trump card in the sleeve of bulls on the euro. On the other hand, if you refer to history, then the slowdown in the S&P 500 is not a reason to refuse to buy the dollar.

If we study the behavior of the US currency (starting from 1978) after the inversions of the yield curve of the Treasuries, the last of which took place about 4-5 months ago, and try to transfer the dynamics of the USD index from the past to the future, then in the next three months the dollar may rise in price by 3 .5%. This will run counter to the majority opinion on the market, which will accelerate the decline in EUR/USD. Experts at Nordea Markets believe that such a scenario is quite possible, and predict a collapse of the euro to $1.0750.

However, not everything depends solely on the US currency. If Washington and Beijing manage to resolve trade disputes, and the eurozone economy embarks on a recovery path, the European Central Bank will have an excellent opportunity to follow in the footsteps of the Riksbank and abandon the policy of negative interest rates, which has many side effects. It is noteworthy that the derivatives market has already begun to lay in the quotes the probability of an increase in the deposit rate in 2020.

Skeptics argue that the European regulator will start the process of normalizing monetary policy only if it wants to get deflation, but in reality everything will depend on the state of health of the eurozone economy.

If the divergence in US and EU economic growth narrows, the Fed, instead of sitting on the sidelines, will begin to talk about lowering the interest rate, and on the contrary, the ECB will raise it, then EUR/USD will go up. In this regard, the consensus forecast of Bloomberg experts on the growth of the euro to $1.16 looks quite convincing.

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