Overview of the EUR/USD pair. April 1. A report from ADP on changes in the number of workers in the US could collapse the

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - downward.

Lower linear regression channel: direction - downward.

Moving average (20; smoothed) - upward.

CCI: 55.1549

The third trading day of the week begins with the same corrective movement that was observed in the first two days. The price successfully adjusted to the moving average line and failed to overcome it within a few hours. Thus, at the moment, we can assume with a high probability that there will be a rebound from this line with the resumption of the upward trend. Moreover, as we have already mentioned in this article, the Senkou span B and Kijun-sen lines of the Ichimoku indicator were worked out, which also act as strong supports, from which the pair can rebound. As a result, we have three strong supports at once. So much the better. If the pair manages to overcome them, the chances of further downward movement will increase many times. If there is a stand-off, the campaign will resume to the north. What is undoubtedly pleasing in the current state of things is the declining volatility of the EUR/USD pair. Yesterday, only 126 points were passed, which is still a lot for the euro currency. However, the pair still does not pass daily by two hundred points, which indicates a slight calming of the market.

Today will be extremely interesting. During the third trading day of the week, a large number of various macroeconomic statistics will be published, from insignificant European to extremely important American. Let's start with the European one. First, a report on retail sales for February in Germany will be published. This report does not even make sense to analyze since there is absolutely no market reaction to it. A little later, business activity indices in the manufacturing sectors of Spain, Italy, France, Germany and the European Union as a whole will be published. This data will also cause at least some market reaction, since the preliminary values have already been published, and they were not a failure or shocking. Yes, there will be a decline in business activity in the manufacturing sector of each country, but not as critical as in the service sectors of the same countries. In Germany, the expected value is 45.5 and in the European Union - 44.7. The values are low, but we would like to remind you that in the last year, business activity in the EU's manufacturing sectors was already below the key level of 50.0, and the industrial sector itself at first just lost its growth rate and then declined in the last year and a half. It would be strange if business activity suddenly started to grow during the raging coronavirus epidemic. Thus, we believe that traders are ready for such figures and they will not be shocked by them. Also today, the European unemployment rate for February will be published, so it is not interesting.

The most interesting data will arrive on April 1 from overseas. First of all, we are talking about the ADP report on changes in the number of employees in the US private sector. Given the fact that the epidemic has led to the strongest increase in unemployment in the US, as well as an increase in the number of applications for unemployment benefits, nothing good can be expected from the ADP report. According to experts' forecasts, we should expect a reduction of 150,000-170,000. Over the past 5 years, the States have only recorded a negative value of this report once, at the end of 2017. Thus, any negative value of the indicator can theoretically put pressure on the US currency. Next, two indices of business activity in the US manufacturing sector for March will be known, according to Markit and ISM. We remind you that the preliminary value of the ISM index is not published, and the preliminary value of the Markit index showed a minimal reduction compared to February - 49.2 points. Yes, business activity in manufacturing in the States will also go "below the waterline", but this is not surprising. The surprising thing is that the decline will only be to 49.2 points or so. However, there is also the ISM index, which is considered more important and significant. And it is for the second index that a serious decline in business activity is expected, from the current 50.1 to 44-45 points. Thus, there is no doubt that business activity in the manufacturing sector will decline by the end of March, the only question is how much will the ISM index decline? But we still believe that first of all, traders will study the report from ADP. And I must say that it can be much worse than the forecasts. From our point of view, it is the ADP report that can provoke new sales of the US currency in the afternoon of Wednesday.

Meanwhile, Donald Trump, via Twitter, showed his satisfaction with the current levels of the Fed's key rate and is also going to initiate a new bill to help the American economy by another $2 trillion. "Since interest rates are now near zero, it is time to pass the long-awaited infrastructure bill. It should be very large-scale and powerful, worth two trillion dollars. He should be fully focused on jobs and rebuilding our country's infrastructure," Trump wrote.

In addition to possible new monetary infusions into the US economy, the Fed will launch a new credit program for central banks starting April 6. Now foreign central banks will be able to receive dollar loans in exchange for US Treasury securities. Earlier, it was reported about the launch of several more programs for dollar lending to foreign central banks. Thus, the US government and the Fed continue to flood not only their economy with cash, but also the world economy. From our point of view, this may significantly reduce the demand for the US currency, which will see some oversupply in the near future. Of course, in the conditions of crisis and panic in the markets, participants can resume buying the US currency, guided only by considerations of the steadfastness of the dollar. However, all the same, fundamental factors will sooner or later return to the scene and make you pay attention to them.

As you can see, the COVID-2019 virus is not retreating. Thus, the markets remain in an agitated state. However, the panic is still slowly subsiding and this can not but please. The economies of many countries around the world remain put on pause, but you can judge their decline by official statistics. Moreover, everything will depend on the time frame during which it will be possible to localize the spread of the epidemic. First of all, this applies to the United States of America and the European Union.

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The average volatility of the euro/dollar currency pair remains at high values, but still continues to gradually fall. The average value for April 1 is 153 points and in the last eight days, the volatility does not exceed 200 points per day. Today, we expect a further decrease in the level of volatility and movement within the channel, limited by the levels of 1.0861 and 1.1167.

Nearest support levels:

S1 - 1.0986

S2 - 1.0864

S3 - 1.0742

Nearest resistance levels:

R1 - 1.1108

R2 - 1.1230

R3 - 1.1353

Trading recommendations:

The euro/dollar pair continues to adjust. Thus, market participants are recommended to wait for the completion of the current correction (the reversal of the Heiken Ashi indicator up) and again buy the euro with the targets of 1.1108 and 1.1167. It is recommended to sell the EUR/USD pair only after fixing the bears below the moving average line with the first target of 1.0864. When you open any position, it is still recommended to be more cautious as the situation on the market remains turbulent.

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

Forecast for EUR/USD on April 1, 2020

EUR/USD

Yesterday, the euro launched an attack on the strong technical support of 1.0967, formed by the point of intersection with the line of the descending price channel and the Fibonacci level of 38.2%, as can be seen on the daily scale chart. At the same time, the price tried to gain a foothold under the MACD indicator line, but it returned to this line by the time the session ended.

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Today, it opened under the MACD line and under the balance line (red indicator), which indicates the market's intention to repeat the attack at 1.0967. The signal line of the Marlin oscillator moves parallel to the boundary with the territory of the bears, waiting for a signal from the price itself.

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Marlin is already in the negative trend zone on the four-hour chart, while the price is kept above the balance and MACD lines. An attack pattern is created for the MACD line, that is, to the target level of 1.0875, determined at the low of October 1, 2019.

So, if yesterday's high of 1.1053 is not violated, short positions in the market can be opened with the target of 1.0875. Stop loss above 1.1053.

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

Forecast for GBP/USD on April 1, 2020

GBP/USD

The British pound lost 170 points on Tuesday at the moment, the day closed near the opening level. With a decrease, the Fibonacci level touched 161.8%, which confirms the working settings of this tool. Therefore, we confirm the early forecast that if the price overcomes the Fibonacci level of 161.8% at the price of 1.2235, the pound may fall to the target at the Fibonacci level of 200.0% at the price of 1.1935.

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On the four-hour chart, the Marlin oscillator has penetrated into the negative trend zone; the second attempt to overcome 1.2235 will probably be successful.

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Aggressive trading allows opening sales at current prices with a stop loss above yesterday's high at 1.2472. A more cautious trading style requires waiting for the breakout of the signal level of 1.2235.

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

Forecast for AUD/USD on April 1, 2020

AUD/USD

The Australian dollar lost 94 points yesterday, and it did not have the strength to overcome the signal level of 0.6078. The signal line of the Marlin oscillator moves along the boundary dividing the growth zone from the decreasing trend zone, it still lacks the initial momentum to turn down.

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Obviously, such an impulse will appear when the price overcomes the signal level of 0.6078. In this case, the 0.5834 target will open - an embedded line of the price channel. Before a price reversal, another small upward movement is possible in the 0.6215/40 range, formed by the line of the price channel and the Fibonacci level of 61.8%.

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On a four-hour chart, a possible exit of the price up to the specified range will mean the formation of a double divergence on the Marlin oscillator. Leaving the price under the signal level of 0.6078 will send the aussie to 0.5834. The MACD line in the area of 0.5915 is the intermediate support here.

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

Forecast for USD/JPY on April 1, 2020

USD/JPY

The dollar jumped 100 points against the yen on Tuesday, but remained under pressure from technical instruments - the balance line (red indicator) and the MACD line (blue indicator). Today, in the Asian session, the price develops in the range of embedded lines of the price channel of the higher scale 107.02-107.85. Consolidating the price under the lower boundary opens the way to movement to the lower line of the price channel 102.60. This is the preferred scenario, since the signal line of the Marlin oscillator is located in the territory of the downward trend. The conditional alternative allows another attempt to raise prices to the MACD line, to 109.00.

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The Marlin indicator is moving up on the four-hour chart, which warns of an alternative. But if growth does not occur, the price will overcome 107.02, sales of the pair with T/P above 102.60 are possible. Yesterday, US stock index S&P 500 fell 1.60%, while the Japanese Nikkei 225 is losing 1.08% today, which puts pressure on the currency pair.

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

Comprehensive analysis of movement options of #USDX vs EUR/USD vs GBP/USD vs USD/JPY (H4) on April 01, 2020

Minuette operational scale (H4)

A day of laughter (April Fool's day) or fun continues in the markets. Here's the development options for the movement of the main currency instruments #USDX vs EUR / USD vs GBP / USD vs USD / JPY from April 1, 2020 in a comprehensive form

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US dollar index

The movement of the dollar index #USDX from April 1, 2020 will be due to the development and direction of the breakdown of the range:

  • resistance level of 99.75 - the lower boundary of the 1/2 Median Line channel of the Minuette operational scale forks;
  • support level of 99.25 - the starting line of SSL of the Minuette operational scale forks

The breakdown of the resistance level of 99.75 is an option for the development of the movement of the dollar index in the 1/2 Median Line Minuette channel (99.75 - 100.65 - 101.55) with the prospect of reaching the SSL Minuette start line (102.40) and the equilibrium zone (102.70 - 104.10 - 104.75) of the Minuette operational scale.

On the other hand, with a sequential breakdown of the resistance level of 99.25 on the initial SSL line of the Minuette operational scale forks and ISL38.2 Minuette (99.50), the movement #USDX will occur again in the equilibrium zone (99.05 - 98.00 - 96.90) of the Minuette operational scale forks.

The details of marking the movement of the dollar index from April 1, 2020 are presented on the animated chart.

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Euro vs US dollar

From April 1, 2020, the development of the movement of the single European currency EUR / USD will continue depending on the development and the breakdown direction of the range:

  • resistance level of 1.0992 - lower boundary of ISL61.8 of the Minuette operational scale forks;
  • support level of 1.032 - the ultimate Schiff Line Minuette.

The breakdown of the final Schiff Line (support level of 1.0932) Minuette will lead to an option to continue the downward movement of the single European currency to the goals:

- reaction line RL61.8 (1.0895) of the Minuette operational scale forks;

- SSL start line (1.0765) of the Minuette operational scale forks

Alternatively, the breakdown of ISL61.8 (resistance level of 1.0992) Minuette will lead to the option of resuming the movement of EUR / USD in the equilibrium zone (1.0992 - 1.1081 - 1.1170) of the Minuette operational scale forks and during the breakdown of ISL38.2 Minuette (1.1170), the movement of this instrument will already begin to flow in the equilibrium zone (1.1150 - 1.1280 - 1.1400) of the Minuette operational scale forks.

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

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Great Britain pound vs US dollar

Her Majesty's GBP / USD currency from April 1, 2020 will continue to develop its movement in the equilibrium zone (1.2070 - 1.2290 - 1.2500 of the Minuette operational scale forks. The details of working out the indicated levels are presented on the animated chart.

The breakdown of the support level of 1.2070 on the lower boundary of ISL61.8 of the equilibrium zone of the Minuette operational scale forks is a continuation of the downward movement of Her Majesty's currency to the equilibrium zone (1.1940 - 1.1750 - 1.1570) of the Minuette operational scale forks.

Meanwhile, in case of breakdown of the upper boundary of the ISL38.2 (resistance level of 1.2500) equilibrium zone of the of the Minuette operational scale forks, the upward movement of GBP / USD will continue to the boundaries of the 1/2 Median Line Line Minuette channel (1.2635 - 1.2815 - 1.2995).

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

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US dollar vs Japanese yen

The currency of the "land of the rising sun" USD / JPY from April 1, 2020 will continue to develop its movement depending on the development and direction of breakdown of the boundaries of the equilibrium zone (107.50 - 108.30 - 109.10) of the Minuette operational scale forks. The details of the development of the mentioned levels are presented on the animated chart.

The breakdown of the upper boundary of ISL38.2 (resistance level of 109.10) equilibrium zone of the Minuette operational scale fork will lead to the continuation of the development of the upward movement of USD / JPY to the goals:

- final line FSL (109.90) of the Minuette operational scale forks;

- ultimate Schiff Line Minuette (110.50);

- 1/2 Median Line Minuette channel (112.00 - 112.50 - 113.00).

On the contrary, the breakdown of the lower boundary of ISL61.8 (support level of 107.50) of the equilibrium zone of the Minuette operational scale forks will lead to the continuation of the downward movement of USD / JPY to the equilibrium zone (106.10 - 104.90 - 103.70) of the Minuette operational scale forks.

We look at the details of the USD / JPY movement on the animated chart.

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The review was compiled without taking into account the news background. Thus, the opening 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 starting date - 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

Trading plan for EUR/USD for March 31, 2020

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Technical outlook:

EUR/USD is drifting/consolidating its previous gains and is seen to be trading around 1.1000 levels at this point in writing. The single currency pair is expected to find support around 1.0950/90 levels, before resuming its rally. The near term target for EUR/USD is seen above 1.1500, which is immediate price resistance as well. A break higher would confirm that medium to long term trend has turned bullish with risk at 1.0630 levels. As discussed yesterday, also note that an engulfing bullish candlestick pattern has appeared on a weekly chart. This also indicated a potential bullish reversal ahead. Overall structure is expected to remain bullish until price stay above 1.0636 support. Aggressive traders may want to buy at current levels with risk below 1.0636 and immediate price targets above 1.1500. A more safe approach is to remain flat for now and allow price action to break above 1.1500; then buy on dips.

Trading plan:

Aggressive: Long now @ 1.1090, stop @ 1.0630 target above 1.1500

Good luck!

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

Instaforex Daily Analysis - 31st Mar 2020

Today we take a look at EURUSD and see how we are going to play the bounce!

We use Fibonacci retracements, extensions, support/resistance, momentum and trend lines to identify trading opportunities in this exciting pair today!

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

Fractal analysis of the main currency pairs for March 31

Forecast for March 31:

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: 1.1273, 1.1220, 1.1133, 1.1068, 1.0988, 1.0942 and 1.0870. Here, we continue to monitor the development of the ascending structure of March 20. We expect short-term upward movement, as well as consolidation, in the range of 1.1068 - 1.1133. The breakdown of the latter value will lead to a pronounced movement. Here, the target is 1.1220. For the potential value for the top, we consider the level of 1.1273. Upon reaching which, we expect a pullback to the bottom.

Short-term downward movement is possibly in the range of 1.0988 - 1.0942. The breakdown of the latter value will lead to an in-depth correction. Here, the potential target is 1.0870. This level is a key support for the top.

The main trend is the upward structure of March 20

Trading recommendations:

Buy: 1.1068 Take profit: 1.1130

Buy: 1.1135 Take profit: 1.1220

Sell: 1.0988 Take profit: 1.0944

Sell: 1.0940 Take profit: 1.0870

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For the pound / dollar pair, the key levels on the H1 scale are: 1.2879, 1.2654, 1.2550, 1.2315, 1.2216 and 1.2099. Here, we are following the development of the upward cycle of March 19. Short-term upward movement is expected in the range of 1.2550 - 1.2654. The breakdown of the latter value will lead to a pronounced movement. Here, the potential target is 1.2550. Upon reaching which, we expect consolidation, as well as a pullback to the bottom.

Short-term downward movement is expected in the range of 1.2315 - 1.2216. The breakdown of the last value will lead to an in-depth correction. Here, the target is 1.2099. This level is a key support for the top.

The main trend is the upward cycle of March 19

Trading recommendations:

Buy: 1.2550 Take profit: 1.2652

Buy: 1.2655 Take profit: 1.2876

Sell: 1.2315 Take profit: 1.2218

Sell: 1.2214 Take profit: 1.2100

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For the dollar / franc pair, the key levels on the H1 scale are: 0.9682, 0.9622, 0.9579, 0.9497, 0.9424 and 0.9342. Here, we continue to monitor the formation of the descending structure of March 20. The continuation of movement to the bottom is expected after the breakdown of the level of 0.9497. In this case, the target is 0.9424. Price consolidation is near this level. For the potential value for the downward trend, we consider the level of 0.9342, upon reaching which, we expect a pullback to the top.

Consolidated movement is expected in the range of 0.9579 - 0.9622. The breakdown of the latter value will lead to an in-depth correction. Here, the target is 0.9682. We expect the initial conditions to be formed for the upward cycle to this level.

The main trend is the downward cycle of March 20, the correction stage

Trading recommendations:

Buy : 0.9579 Take profit: 0.9620

Buy : 0.9623 Take profit: 0.9680

Sell: 0.9497 Take profit: 0.9426

Sell: 0.9422 Take profit: 0.9345

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For the dollar / yen pair, the key levels on the scale are : 109.58, 108.72, 108.17, 107.27, 106.56, 106.10 and 105.15. Here, we are following the development of the descending structure of March 25. The continuation of movement to the bottom is expected after the breakdown of the level of 107.27. In this case, the target is 106.56. Price consolidation is in the range of 106.56 - 106.10. For the potential value for the bottom, we consider the level of 105.15. We expect a rollback to the top upon reaching this level.

Consolidated movement is possible in the range of 108.17 - 108.72. The breakdown of the last value will lead to an in-depth correction. Here, the goal is 109.58. This level is a key support for the downward structure.

Main trend: the downward trend of March 25

Trading recommendations:

Buy: 108.17 Take profit: 108.70

Buy : 108.74 Take profit: 109.56

Sell: 107.25 Take profit: 106.56

Sell: 106.10 Take profit: 105.15

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For the Canadian dollar / US dollar pair, the key levels on the H1 scale are: 1.4344, 1.4215, 1.4119, 1.3956, 1.3747, 1.3615 and 1.3425. Here, we are following the development of the downward cycle of March 19. At the moment, the price is in correction. The continuation of the movement to the bottom is expected after the breakdown of the level of 1.3956. In this case, we expect a pronounced movement. Here, the target is 1.3747. Short-term downward movement, as well as consolidation is in the range of 1.3747 - 1.3615. For the potential value for the bottom, we consider the level of 1.3425. Upon reaching this level, we expect a pullback to the top.

Consolidated movement is possibly in the range of 1.4119 - 1.4215. The breakdown of the last value will lead to an in-depth correction. Here, the potential target is 1.4344. This level is a key support for the downward structure.

The main trend is the descending structure of March 19.

Trading recommendations:

Buy: Take profit:

Buy : 1.4217 Take profit: 1.4344

Sell: 1.3954 Take profit: 1.3750

Sell: 1.3745 Take profit: 1.3620

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For the Australian dollar / US dollar pair, the key levels on the H1 scale are : 0.6596, 0.6511, 0.6352, 0.6241, 0.6031, 0.5935 and 0.5779. Here, we are following the development of the upward cycle of March 19. At the moment, we expect a movement to the level of 0.6241. Short-term downward movement, as well as consolidation is in the range of 0.6241 - 0.6352. The breakdown of the level of 0.6352 will lead to a pronounced upward movement. Here, the potential target is 0.6595. Price consolidation is in the range of 0.6595 - 0.6511.

Short-term downward movement is possibly in the range of 0.6031 - 0.5935. The breakdown of the last value will lead to an in-depth correction. Here, the target is 0.5779. This level is a key support for the top.

The main trend is the upward structure of March 19

Trading recommendations:

Buy: 0.6241 Take profit: 0.6350

Buy: 0.6354 Take profit: 0.6511

Sell : 0.6030 Take profit : 0.5935

Sell: 0.5933 Take profit: 0.5780

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For the euro / yen pair, the key levels on the H1 scale are: 124.47, 123.42, 121.83, 120.62, 119.35, 118.66, 117.73 and 116.27. Here, we are following the development of the ascending structure of March 12. Short-term upward movement is expected in the range of 120.62 - 121.83. The breakdown of the last value will lead to a pronounced movement. Here, the target is 123.42. For the potential value for the top, we consider the level of 124.47. Upon reaching which, we expect consolidation, as well as a pullback to the bottom.

Short-term downward movement is possibly in the range of 119.35 - 118.66. The breakdown of the latter value will lead to an in-depth correction. Here, the goal is 117.73. This level is a key support for the top.

The main trend is the upward structure of March 12

Trading recommendations:

Buy: 120.62 Take profit: 121.80

Buy: 121.85 Take profit: 123.40

Sell: 119.35 Take profit: 118.70

Sell: 118.62 Take profit: 117.75

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For the pound / yen pair, the key levels on the H1 scale are : 140.54, 138.12, 136.99, 134.93, 133.59, 131.58, 129.78 and 127.47. Here, we are following the development of the upward cycle of March 18. Short-term upward movement is expected in the range of 133.59 - 134.93. The breakdown of the last value should be accompanied by a pronounced upward movement. Here, the target is 136.99. Price consolidation is in the range of 136.99 - 138.12. For the potential value for the top, we consider the level of 140.54. Upon reaching this level, we expect a pullback to the bottom.

Short-term downward movement is possibly in the range of 131.58 - 129.78. The breakdown of the latter value will lead to in-depth movement. Here, the target is 127.47. This level is a key support for the upward structure.

The main trend is the upward cycle of March 18

Trading recommendations:

Buy: 133.60 Take profit: 134.90

Buy: 134.95 Take profit: 136.99

Sell: 131.58 Take profit: 129.80

Sell: 129.70 Take profit: 127.50

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

Will China become the driver of global economic recovery? (AUD/USD and USD/JPY pairs are expected to continue to locally

The data on the index of business activity in the manufacturing sector (PMI) of China published on Tuesday were unexpectedly strong, which served as the basis for positive dynamics in the stock markets in the Asia-Pacific region.

According to the data from China, the index of business activity in March unexpectedly rose to 52.0 points from the February value of 35.7 points and the expected growth forecast to 45.0 points. Moreover, it rose above an important level of 50 points, which indicates an objective increase in production in the country after the most severe quarantine measures that were taken at the beginning of the year in the wake of the coronavirus epidemic. It is important to note that the resumption of the pace of work of enterprises amounted to 98.6%, and the number of returned workers rose to 89.9%.

This is very encouraging news. This raises the question: Will China become the driver of global economic recovery from the consequences of COVID-19?

Of course, there are such hopes, but it should be recognized that the Chinese economy, while still being a global manufacturing workshop, will be able to fully function if demand starts to recover in Europe and North America, where the so-called "golden billion" of Chinese consumers are concentrated, and not only it. In this case, China will only be able to return to the usual economic growth rate of around 6.0%. But now it is predicted that it will be from 1% to 2% in the first half of the year, no more than that.

Again, as before, we believe that April will be a decisive month. If a pandemic can be curbed in Europe and the USA, and such signals have already begun to appear in Italy, the epicenter of this infection in the European part of Eurasia, then demand will begin to recover and apocalyptic forecasts of a future grave global crisis will not come true. The failure in the growth of the global economy can reach 10%, which can be overcome already this year.

Based on this, we believe that a gradual recovery in demand for risky assets will put pressure on the dollar, which will continue to decline smoothly against major currencies.

Given the positive on the background of Chinese statistics, we believe that the opening of trading in Europe in the "green" zone, and stock index futures so far demonstrate this, will lead to an increase in the exchange rates of major currencies against the dollar, as well as its growth against the yen and the Swiss franc.

Forecast of the day:

The AUD/USD pair has every chance to continue to grow to the level of 0.6365 after breaking through the level of 0.6210.

The USD/JPY pair can also grow to our previous target 109.00 after breaking through which the direction will open for it to the level of 109.30.

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

Oil is looking for a bottom

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On Monday, crude oil was trading below $ 20 per barrel. Traders assume that oil production may stop, as demand for it, in connection with the coronavirus, declined significantly.

The oil industry is currently facing the biggest drop in oil demand in history, and analysts, as well as traders, believe that the price of oil will continue to decline in the near future.

There are also speculations that in April, oil surplus may reach 25 million barrels.

Jason Bordoff, founding director of the Center on Global Energy Policy and former energy adviser to the Obama administration, said that this historic collapse is not over yet because soon, we will see numerous closures in oil production, as producers are likely to be forced to stop production on an unprecedented scale in the modern oil industry.

With higher costs to producers such as US shale and Canadian oil sands, the current prices are disadvantageous, so naturally, these companies will very much hope that other smaller producers will stop their production first. In addition, according to Baker Hughes, the rapid decline of oil has already led to the reduction of drilling rigs in the US last week. Analysts said that the US oil industry will most likely shrink to 2.5 million barrels per day by the end of 2021, despite the fact that US has greatly expanded this industry in recent years. Other high-cost production, from the North sea to fields in Asia, are also under pressure. The largest oil companies, of course, are cutting capital expenditures or studying plans to reduce them.

Meanwhile, Mathios Rigas,CEO of Energean Oil & Gas, said that weaker companies will go bankrupt. "We will see a big drag on investment decisions," Rigas said. "We are in a different world, but there will be survivors," he continued, adding that some companies will see investment opportunities while others will go bankrupt.

US has put little pressure on Saudi Arabia to reduce oil production, as the drop in demand gave a much greater impact on the price.

Bjornar Tonhaugen, head of oil markets in Rystad Energy, said that the decline in oil demand is the main factor why the price of oil dropped. According to him, it outweighs the increase in supply "by 4-5 times,". "Supply chains in the oil market is broken because of the incredibly large losses," Tonhauser said. According to him, refineries are reducing the processing of crude oil into fuel, and oil companies may begin to close production wells.

Meanwhile, yesterday, Trump and Putin had a telephone conversation, discussing about the spread of the coronavirus around the world. They agreed to consult with energy departments, in order to stabilize oil prices. After that, WTI oil jumped by 7%, while Brent increased by 3.6%.

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Trading plan for EUR/USD and GBP/USD on 03/31/2020

Surprisingly, despite the constant stream of reports about the victorious March of the coronavirus around the world, the currency market behaved strictly in accordance with the macroeconomic data published yesterday. That is, we can say that the market is returning to a certain normality. However, volatility continues to remain somewhat high. The nature of reports regarding the coronavirus indicated that the common European currency should lose ground. Indeed, not only that the number of infected exceeded the mark of 100 thousand in Italy, but also Spain in this indicator came in third place, ahead of China.

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The currency market began the week with a strengthening dollar, which looked like a banal rebound at first from the confident movement of the past week. Well, the dollar cannot exclusively lose its position. But quite quickly, the pound began to behave differently from the single European currency, and the data on the lending market in the UK turned out to be the reason for such an initiative. After all, the most important thing is that the number of approved mortgage loans has not decreased from 70.9 thousand to 67.5 thousand, but increased to 73.6 thousand. It is equally important that the volume of mortgage lending in February, as in January amounted to 4.0 billion pounds. It was expected to reach 3.8 billion pounds. And if we take into account the importance of the real estate market for the UK economy and its investment attractiveness, then the optimism of market participants is understandable.

Mortgages Approved (UK):

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But the single European currency had something to worry about, as preliminary data on inflation in Spain showed a slowdown from 0.7% to 0.1%. It was predicted that inflation will decline to 0.5%. And a stronger slowdown in inflation was not even offset by the acceleration, from 1.7% to 1.8%, of retail sales growth rates. After all, it was expected that sales should accelerate to 2.3%. In other words, everything is much worse in terms of inflation than expected. And this is in anticipation of the publication of pan-European data. True, in Germany, as expected, inflation fell from 1.7% to 1.4%. But since inflation in the fourth economy of the euro area has declined much more significantly than forecasts, then in the euro area as a whole, it may turn out to be worse than forecast. And separately it is worth paying attention to the fact that this is the data for March.

Inflation (Spain):

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Well, American statistics finally put everything in its place. The growth rate of pending home sales transactions accelerated from 5.8% to 9.4% instead of slowing down from 5.7% to 1.5%. That is, not only acceleration was recorded, instead of deceleration, the previous data was also revised upwards. However, we are talking about an indicator that indicates the number of transactions for the sale of housing, which simply have not yet had time to complete. Most often this happens for the simple reason that the parties to the transaction simply wait for registration documents from the registration authorities. This does not affect the actual fact of making a transaction. Just the final stage, namely payment, is transferred to the next month. Therefore, the growth of this indicator suggests that there is a high probability of growth in home sales. As in the primary market, so on the secondary. And of course, which is quite an optimistic factor. Thus, given the way European statistics came out, it's quite clear why the single European currency was declining, and the pound was more likely to stand still.

Unfinished Home Sales (United States):

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At the same time, the general mood for further increase of the dollar remains. Even with respect to the pound. Moreover, the final data on GDP for the fourth quarter finally confirmed the fact of a slowdown in economic growth from 1.2% to 1.1%. So it is not surprising that the mood for the pound in the morning is rather negative, because the slowdown in economic growth, especially in the light of current events, clearly indicates that a deep economic recession will be recorded in the first quarter.

GDP growth rate (UK):

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The most interesting data today is the data which will be published on the euro area. Of course, we are talking about preliminary data on inflation for March, which should show a decrease from 1.2% to 1.1%. However, recalling yesterday's data on inflation in Spain, it is likely that the data will be even worse. In addition, inflation data is also published in France and Italy. And if in the Fourth Republic they expect a decrease from 1.4% to 0.9%, then in the long-suffering Apennines, a rise in consumer prices by 0.3% should be replaced by their decrease by the same 0.3%. That is, in the third economy, the euro zone is waiting for the return of deflation. Therefore, the probability of the resumption of this fascinating process throughout Europe, is becoming more and more realistic. At the same time, the situation is likely to only worsen, since everything is the same Italy, the decline in producer prices should accelerate from -2.3% to -2.7%. So the growth potential of inflation is becoming somewhat illusive. And in Germany, following the United States, they expect a worsening situation on the labor market, as the unemployment rate should rise from 5.0% to 5.2%. And since the unemployment rate is growing, then consumer spending will be reduced, which means that there is nothing to increase inflation. Well, the data on the balance of payments of Spain for January, which should show a deficit of 1.7 billion euros, will become a cherry on the cake. And this is nothing more than another confirmation of the fact that at the moment we are observing precisely the outflow of capital. Indeed, the previous ten months, the balance of payments of the fourth economy of the euro area was purely surplus.

Inflation (Europe):

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In the United States, they are waiting for a new portion of positivity after excellent data on pending home sales. This time in the form of a housing price index from S & P / CaseShiller, which should show an acceleration in the growth rate of these prices from 2.9% to 3.2%. That is, we have sales growth combined with price increases. Well, just the perfect picture. Not a reality, but a dream.

S & P / CaseShiller (United States) Housing Price Index:

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The euro/dollar currency pair returned to the level of 1.1000 once again, where it slowed down and formed a variable range of 1.1000 / 1.1050. It is likely to assume that in case the price is fixed lower than 1.0980, the downward interest will resume directing the quote in the direction of 1.0950-1.0900.

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The pound/dollar currency pair continues to fluctuate within the level of 1.2350, forming a consolidation of Doji candles below it. It is likely to assume that in case of working out the level of 1.2350 as resistance and fixing the price lower than 1.2300, downward interest may resume towards 1.2250-1.2200.

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Trading plan for WTI Crude for March 31, 2020

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Technical outlook:

WTI Crude had dropped to 19.30 levels today during early hours of trade, before reversing sharply. It is seen to be trading around 21.20/30 levels at this point in writing and bulls remain poised to push further higher towards 22.00, before retracing lower again. Strong resistance is seen around the 25.00 levels and a break higher would confirm the reversal. As discussed yesterday and shown here, the fibonacci extensions of earlier drop between 76.88 and 42.40 has already been met around 20.90 levels, and at least a counter trend rally was due any moment. The recent low at 19.30 may remain as interim support, going further. Also note that a pin bar candlestick pattern is under way on the weekly chart, indicating a potential trend reversal. The retracement levels are highlighted here and fibonacci 0.382 is seen around 37.00 levels. A pullback rally might be materializing towards the above levels.

Trading plan:

Remain long stop @ 19.30 target is open.

Good luck!

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Indicator analysis. Daily review of GBP/USD on March 31, 2020

Trend analysis (Fig. 1).

Today, the pair will continue to move down from the level of 1.2418 (closing of Friday afternoon's candle) with the first target at 1.2258, a retreating level of 23.6% (blue dashed line). Upon reaching this line, an upward movement is possible with a target of 1.2518, a retracement level of 61.8% (blue dashed line). From this level, a continuation of the upward movement is possible.

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Fig. 1 (daily chart).

Comprehensive analysis:

- Indicator analysis - down;

- Fibonacci levels - down;

- Volumes - up;

- Candlestick analysis - down;

- Trend analysis - up;

- Bollinger Lines - up;

- Weekly schedule - up.

General conclusion:

Today, a continuation of the down movement is possible with the first target of 1.2258, a retracement level of 23.6% (blue dashed line). Upon reaching this line, the upward movement is likely to continue.

Unlikely scenario: from a retracement level of 23.6% - 1.2258 (blue dashed line) work down with a target of 1.2096, a retracement level of 38.2% (blue dashed line).

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Trading plan for Gold for March 31, 2020

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Technical outlook:

Gold is seen to be trading around $1,615 levels at this point in writing with a negative bias, looking to break down below $1,600 levels. The rectangle highlighted on the above chart is resistance zone for any intraday rallies. The overall structure remains bearish for the yellow metal until prices stay below $1,703 levels. Immediate resistance is seen at $1,703, while interim support is seen around $1,450 levels respectively. The recent boundary being worked upon is between $1,703 and $1,450. As seen here, Gold has risen through the fibonacci 0.618 retracement and almost reached the 0.786 resistance before pulling back. Another spike might push prices through $1,649/50 levels before reversing sharply. Please note that fibonacci extensions are pointing towards $1,298 levels going forward. If we go by the time line taken to form the above wave structure since $1,703 highs, Gold prices remain poised to reach $1,298 levels in the next 4-5 weeks.

Trading plan:

Remain short from yesterday @ $1,615/25. stop @ 1,703 target @ 1,298

Good luck!

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EUR/USD. Dollar at a crossroads: two scenarios

The euro-dollar pair showed a downward track during the Asian session on Tuesday, but still remained within the 10th figure. Bears failed to break through the support level of 1,1010 yesterday (the upper limit of the Kumo cloud on D1) – as soon as sellers touched this target, they attracted the attention of buyers, who returned the pair to the middle of the 10th price level. However, bearish sentiment still continues to dominate: today, EUR/USD again entered the ninth figure, trying to confirm the strength of the downward movement. Judging by the persistence of the bears, the pair will still drop a step lower, while the further vector of price movement is still in question.

By and large, the future fate of all dollar pairs will depend on the overall attitude of investors to the US currency. The rapid growth of the greenback in mid-March was caused by panic: the dollar became the only lifeline for which all investors simultaneously reached out, throwing off less liquid assets. Such excitement helped dollar bulls to survive difficult times, when the Federal Reserve lowered the rate at extraordinary meetings, launching the printing press along the way. The US currency simply ignored all the decisions of the Fed, maintaining the safe-haven status and the most popular currency in the world.

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However, further events were able to suspend the US dollar's growth – the Fed opened dollar swap lines with the ECB, the Bank of Japan and the Bank of England and nine other central banks slightly reduced the excitement around the greenback. Jerome Powell announced a $700 billion quantitative easing program, and later lifted the threshold and made the program unlimited in amount. The Fed also opened credit lines for corporations, states, and local governments. The Fed chief noted that the current purchases of US Treasury and mortgage-backed securities will be expanded "as much as necessary". In addition, there are rumors on the market that in the event of further revaluation of the greenback, the G7 countries may take a coordinated decision to "curb" it, organizing, for example, a "big dollar sell-off".

This fundamental background made it possible for the EUR/USD bulls to take revenge, raising the price to the middle of the 11th figure. However, buyers also failed to rise above this level, against the backdrop of a failed online summit of EU leaders. In addition, the dollar is still considered by the market as the most reliable defensive asset, so as soon as the upward momentum began to fade, traders began to take profits, closing long positions.

The dollar has gradually gained momentum, but there is another side of the coin: important macroeconomic reports will be published this week in the US (ISM indices, Nonfarm payrolls, the number of applications for unemployment benefits, etc.), which may alert and scare traders from the US currency. According to preliminary estimates, the report results will be disastrous – for example, for the first time in many years, the growth rate of employment in the non-agricultural sector will fall into negative territory.

Thus, from a fundamental point of view, the pair was at a crossroads: on the one hand, the dollar retains the status of a defensive asset, on the other hand, it is potentially under the impact of extremely negative macroeconomic reports. For EUR/USD bulls, there is a risk that traders will ignore the weak figures, and against all odds will continue to invest in the US currency. However, the pair's bears are also exposed to a similar risk, especially if the releases turn out to be even worse than the extremely weak forecasts. In this case, the US economy will scare investors away from the dollar. Which of the two scenarios will be implemented is an open question. The answer can be found when the Nonfarms data is published at the end of the week.

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From a technical point of view, there is a similar picture of uncertainty: on the daily chart, the price is located on the middle line of the Bollinger Bands indicator, and the trend indicators have not formed any clear and unambiguous signals. However, if buyers still show character and the pair is consolidated above the 1.1070 mark (the average line of the Bollinger Bands indicator coincides with the Kijun-sen line on the daily chart), the Ichimoku indicator will form a bullish Parade of Lines signal - in this case, it will be possible to consider long positions with the goal of 1.1147 (the local high reached on March 27). But if the bears finally settle below the level of 1.1010 (the upper limit of the Kumo cloud on D1), then short positions will be prioritized here (with the goal of 1.0880) – with a high probability, the downward dynamics will strengthen, and the pair will reach the lower limit of the above cloud. Thus, the intermediate support level is 1.1010, while the stronger level is 1.0880 (the lower boundary of the Kumo cloud on D1 coincides with the Tenkan-sen line). The price ceiling (resistance level) is the local high of 1.1147.

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Indicator analysis. Daily review of EUR/USD on March 31, 2020

Trend analysis (Fig. 1).

Today, the pair will continue to move down with the first target at 1.0953, a pullback level of 38.2% (blue dashed line). If this level is reached further, work up with the target of 1.1168, a retracement level of 61.8% (red dashed line). From this level, it is likely to continue to work up.

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Fig. 1 (daily chart).

Comprehensive analysis:

- Indicator analysis - up;

- Fibonacci levels - down;

- Volumes - up;

- Candlestick analysis - down;

- Trend analysis - up;

- Bollinger Lines - up;

- Weekly schedule - up.

General conclusion:

Today, the price will try to continue its upward movement after a small pullback.

An unlikely scenario: from a pullback level of 38.2% - 1.0953 (red dashed line), work down with a target of 1.0993, a pullback level of 50.0% (blue dashed line).

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Hot forecast for EUR/USD on 03/31/2020 and trading recommendation

In fact, the dollar has been losing ground over the past week, and the main driving force for this has been the development of the situation with the spread of coronavirus in the United States. Yesterday, the dollar resumed its growth, which was due to both fundamental economic factors and the same coronavirus. It's just that the really bad news, to a greater extent, began to come from Europe again. Not only has the number of confirmed cases of coronavirus infection in Italy exceeded 100,000, but Spain also took third place in this terrible anti-rating.

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If we talk about purely economic factors, the growth rate of pending home sales in the United States increased from 5.8% to 9.4%. And not only that, the data turned out to be significantly better than the forecasts, which indicated a slowdown to 1.5%, but also the previous data was revised upwards from 5.7%. An increase in the growth rate of pending home sales transactions indicates a high potential for sales growth.

Unfinished Home Sales (United States):

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Today, preliminary data on inflation in Europe will be in the spotlight, which should show a decrease from 1.2% to 0.7%. Such a rapid decline in inflation will undoubtedly intensify the talk about the need to reduce the refinancing rate of the European Central Bank. The very decline in inflation is clearly not optimistic. Moreover, as a result, the data may turn out to be slightly worse than forecasts, and inflation will slow down even more. This in particular is indicated by yesterday's data on Spain, where deflation is about to begin.

Inflation (Europe):

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The S&P/CaseShiller data on housing prices in the United States will boost the dollar even more, since the growth rate of these prices can accelerate from 2.9% to 3.3%. In combination with yesterday's data on pending transactions, a picture emerges of a combination of both sales growth and price increases. Nearly perfect conditions. So really, the dollar will have a lot of reasons for growth.

S&P/CaseShiller (United States) Housing Price Index:

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From the point of view of technical analysis, we see that after the upward movement, the quote reached the level of 1.1150, where it slowed down and, as a fact, was corrected to the area of the psychological mark of 1.1000. In fact, we last returned the quote to the measure of last Friday, where the pivot point coincided with the current value. Regarding volatility, we see that market activity still remains high, steadily exceeding 100 points.

In terms of a general review of the trading chart, we see that the quote has been in inertial fluctuations for two months now, where it is highly exposed to the external background.

We can assume a temporary fluctuation within 1.1000/1.1050, where in case of price taking lower than 1.0980, downward interest will resume in the direction of 1.0950-1.0900.

Concretizing all of the above into trading signals:

- Short positions, we consider in case of price taking lower than 1.0980, with the prospect of a move to 1.0950-1.0900.

- Long positions, we consider the form of alternative transactions in case of price taking higher than 1.1060, towards 1.1080.

From the point of view of a comprehensive indicator analysis, we see that the minute and hour intervals occupy a downward position against the background of the price returning to the level of 1.1000. Daily periods signal purchases due to an earlier upward move of more than 400 points.

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USD Index Price Movement For March 31, 2020

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The US Dollar Index on 4 Hour Chart is now making a Market Maker Sell Model since the index has already broken out and closed below 101.08. From the technical viewpoint, since the CCI (30) has been already moving below the 100(1), 0(2), and -100(3) levels. As the price is moving below the downward slope 30-period Moving Average, we know exactly that USDX is trading under downward pressure. Now it aims to reach 98.26 as the nearest liquidity pool. As long as the index does not retrace upwards higher than 99.80, the 98.26 level is likely to be broken soon.

The overall bias of #USDX is bearish.

(Disclaimer)

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EUR/GBP to reach 0.8866. Analysis for March 31, 2020

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The EUR/GBP pair is now making a Market Maker Sell Model on the 4-Hour Chart. The pair has already broken out and is moving below 0.9121. From the technical viewpoint, the CCI (30) has been already moving below this 3 important levels: 100, 0, and -100. Besides, the price has been already moving below the MA 30. All these conditions give us a sign that EUR/GBP has been already trading under downward pressure. For now, this pair is trying to reach 0.8866 (a previous day's low). As long as this pair does not retrace upward higher than 0.8987 and the CCI does not move above the zero level, 0.8866 is likely to be broken as the nearest liquidity pool.

The overall bias of EUR/GBP is bearish.

(Disclaimer)

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Bottom is not yet visible and panic may intensify after the publication of macroeconomic reports; Overview of NZD and AUD

News about the slowing or increasing spread of COVID-19 around the world is currently the main impulse of the markets. Emergency measures to support national economies have been taken by all the leading countries, which act according to the common logic and take similar actions.

A global contraction in the global economy is becoming apparent despite the fact that data on trade and industrial production for March will not be published soon. The dynamics of PMI reduction does not give any other result than the recognition that the economic shock will be stronger than in 2008.

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A certain positivity follows from recent reports from Italy, the Netherlands and Portugal, which report a slowdown in the spread of the coronavirus. The experience of China shows that the active period can be reduced with due effort to two months, so the business is already beginning to prepare for a "life after the pandemic," assessing both the depth of the fall into the recession and the prospects for recovery.

The strong decline in the dollar over the past 10 days is primarily due to the fact that the spread of the virus in the United States is currently the main threat that can plunge the world into economic chaos. Yields on 10-year US Treasures stuck in the range of 0.6% -0.7% and investors fear that the publication of ISM reports on employment data in March this week will be worse than market expectations. The Dallas Fed report on business activity in March showed a drop from 1.2p to -70p, and although it more closely reflects the state of the US oil industry, there is no reason to believe that the services sector will withstand the attack of COVID-19.

The panic is increasing, so in the coming days, another wave of oil decline, growth in demand for gold and other protective assets is likely.

NZD/USD

Last week, the RBNZ announced the first QE program in its history, which is called the Large Asset Purchase Program (LSAP), began redeeming bonds, having previously cut the rate and eased the requirements for the core capital of banks.

The actions of the RBNZ completely repeat the measures of other large central banks, which, one by one, turn into a "lender of last resort". A certain positive effect was obtained, the government is implementing its aid package of 5% of GDP, however, the program can be expected to expand, as several countries have introduced measures of up to 10% of GDP.

The depth of economic decline is visible now. The business optimism index from the RBNZ fell in March from 19.4p to -63.5p, which is worse than during the 2008 crisis, the outlook for the near future is negative.

The quarantine in New Zealand will last at least 4 weeks. According to ANZ Bank estimates, the reduction in GDP in Q1 quarter can reach 5-6% of GDP, and in the 2nd quarter up to 17%. Such forecasts cannot provide any support for the New Zealand dollar. Although the CFTC report showed a minimal change in aggregate position, the estimated fair price started moving downwards.

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It is still higher than the spot, and therefore, the short-term impulse of NZD/USD can continue to the resistance of 0.6199, however, the long-term prospects of the kiwi will deteriorate. Under current conditions, it is logical to enter short positions from current levels with a stop of 0.6175 and a target of 0.5905 / 10.

AUD/USD

A strong 7% increase in the S & P / ASX 200 index on Monday is the result of the launch of the third government package of financial support for the economy, which includes wage subsidies for the most affected firms, the total aid package will reach $ 130 billion, or 6.5% of GDP.

The dynamics of the estimated fair price AUD is negative, so the current growth of AUD/USD is close to completion.

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The recommendations are the same as for NZD - the bullish momentum is close to exhaustion and the Australian currency is near the pivot point. The AUD will likely return to the zone 0.6020 / 70, after which there will be an increase in the downward movement, the subsequent targets are 0.5970 and 0.5870.

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