Overview of the GBP/USD pair. February 18. Wages in the UK may cause a new fall in the pound

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - sideways.

Lower linear regression channel: direction - downward.

Moving average (20; smoothed) - up.

CCI: -5.9140

The GBP/USD currency pair returned to the moving average line on February 18 and threatens to consolidate below it again. Thus, once again, the bulls do not have the strength and desire to continue forming an upward trend, the makings of which appear due to the consolidation of quotes of the pound/dollar pair above the moving average. However, we do not see anything surprising, since the pound remains extremely weak. There are no reasons for its purchases (especially long-term ones) now. But there are plenty of reasons to get rid of the British currency. And we are more interested in the moment why the pound has not become cheaper in recent months. However, as in the case of the euro, the luck will end sooner or later. Most likely, the same thing will happen with the pound.

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There will be no important or significant publications in the United States on Tuesday, but some interesting reports will come from the UK. First, the unemployment rate for December. It should be noted immediately that the unemployment rate remains one of the strongest indicators of the state of the economy for Britain. It is the one with the least questions since it is consistently at its minimum values of about 3.8%. However, it is also an indicator that traders rarely react to. Rather, it is more statistical.

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The same can be said about the rate of change in the number of applications for unemployment benefits. It is rare when it happens that the real value of this indicator is very different from the forecast, which provokes more active trading on the market. Usually, this indicator also attracts very little attention from market participants. However, according to experts' forecasts, the unemployment rate in December will remain unchanged – 3.8% and the number of new applications for benefits will be 22,600.

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The latest and most significant report today is the change in UK wages for December. In recent months, as the graph shows, the rate of wage growth in the Foggy Albion has begun to decline. And since this indicator is quite important, it is not surprising that it has started to show a negative trend recently, following a whole host of other important indicators, such as GDP or industrial production. Taking into account bonuses, the salary increase in December should be 3%, and without bonuses – 3.3%. In any case, both forecast values are lower than the values of the previous month (November) so we can expect a deterioration in the figures. Well, for the British pound, this deterioration will mean another potential reason for resuming its own decline. As we have said many times, nothing in the UK is changing for the better, so on what basis should we expect the strengthening of the British currency? One Boris Johnson from time to time provokes small purchases of the pound by his actions. However, there is also nothing positive (at least in the short term) in his actions for the British pound and the UK. Thus, the pound will remain prone to falling. In the near future, namely in early March, negotiations between Brussels and London will officially begin on a trade agreement that will be valid between the Kingdom and the Alliance after 2020 and information about this process will begin to be available to traders. Accordingly, starting in March, the fate of the British currency will largely depend on the course of negotiations.

From a technical point of view, the pound may consolidate below the moving average today, which will return the pair to a downward trend. The lower channel of linear regression is directed downward, so it is the downward movement that is now more preferable. Not to mention the fundamental factors.

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The average volatility of the pound/dollar pair over the past 5 days has dropped to 73 points and continues to fall. According to the current volatility level, the working channel on February 18 will be limited to the levels of 1.2929-1.3075. There will be few important macroeconomic statistics today, so it is unlikely that volatility will be high.

Nearest support levels:

S1 - 1.2970

S2 - 1.2939

S3 - 1.2909

Nearest resistance levels:

R1 - 1.3000

R2 - 1.3031

R3 - 1.3062

Trading recommendations:

The GBP/USD pair is trying to change the upward trend to a downward trend. Thus, purchases of the pound with targets of 1.3031 and 1.3062 can be considered if the pair remains above the moving average. However, we still do not see why the British currency can now perform growth in fundamental terms. It is recommended to return to more reasonable sales of the pound after fixing the price below the moving average line with the first targets of 1.2970 and 1.2939.

In addition to the technical picture, you should also take into account the fundamental data and the time of their release.

Explanation of the illustrations:

The highest linear regression channel is the blue unidirectional lines.

The lowest linear regression channel is the purple unidirectional lines.

CCI - blue line in the indicator window.

Moving average (20; smoothed) - blue line on the price chart.

Murray levels - multi-colored horizontal stripes.

Heiken Ashi is an indicator that colors bars in blue or purple.

Possible variants of the price movement:

Red and green arrows.

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Head & Shoulders Pattern On USD/JPY

USD/JPY has developed a minor Head and Shoulders pattern on the H4 chart. The pair has pressured the neckline again, but we have only a false breakdown at this moment. I believe that a valid breakdown and a validation will signal a potential corrective phase on USD/JPY.

USD/JPY may drop as the JP225 index has plunged today, the index has opened with a gap down and it seems very heavy in the short term. When JP225 drops, the Japanese Yen should increase versus other major currencies, not only versus the US dollar.

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USD/JPY failed to reach and retest the median line (ML), orange line, of the ascending pitchfork signaling the overbought market, so a valid breakdown below the minor uptrend line (neckline) could send the rate at least till the 61.8% retracement level.

The pair wasn't able to reach the 110.21 static resistance, a minor correction could come as the MACD and Stochastic have shown a bearish divergence. When the price fails to reach the median line (ML) of an ascending pitchfork, it should reverse, that's why I'm expecting a potential bearish momentum.

  • Trading Tips

If the pattern is confirmed, we could open a short position with a Stop Loss above the 109.95 previous high. USD/JPY is somehow expected to drop by 50 pips in the short term, but it could drop deeper if it stabilizes below the 61.8% retracement level. The major downside target is seen at the sliding parallel line (SL1).

The chart pattern could be invalidated if the price jumps above the 109.95 shoulder and if it reaches the median line (ML).

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Data from Germany and the publication of the Fed protocol is the focus of the market today (we expect a prospective decline

The Australian dollar came under pressure in the wake of the published protocol of the last meeting of the RBA on monetary policy, which showed that it discussed the probability of continued easing of monetary policy.

Despite the fact that the Reserve Bank of Australia decided to keep the key interest rate at the previous record low of 0.75%, the meeting discussed the topic of readiness for further easing of the monetary policy of the regulator, if necessary. In regards to the problems that risks the Australian economy, the Central Bank seperated the situation with the coronavirus epidemic in China, the inhibition of the country's economy due to forest fires, which could cause a decrease in economic growth in the fourth quarter of last year, as well as in the first quarter of this year. The Bank also highlighted the risk of uncertainty in the level of consumption, however, which can be supported by rising housing prices and their turnover.

In the wake of the promulgated document, the Australian dollar was down against the American one by almost 0.4% at the moment.

The decline in the "Australian" currency had also a negative impact on the New Zealand currency, which has also been under pressure since the beginning of this year amid the situation with coronavirus in China.

Today, market attention will be turned to the publication of data on employment in Britain. The level of average wages in this country, as well as the values of the index of current economic conditions and sentiments in Germany and the eurozone. It is expected that the indicators will show a decrease respectively to -10.3 points from -9.5 points and from 26.7 points to 21.5 points in Germany. At the same time, it is assumed that the index of current economic sentiment in the eurozone, on the contrary, should grow to 30.0 points in February from a January value of 25.6 points.

First of all, if the data in Germany turns out to be worse than expected, this will inflict another blow on the single currency exchange rate, which is still under strong pressure amid clear signals that the economic growth of the first eurozone economy has slowed down.

In addition to the events presented above, the markets are sure to attract the publication of the protocol of the last Fed meeting on monetary policy today. Investors will carefully study it in order to understand whether it is worth expecting any promising changes in the actions of the American regulator in the near future.

In general, we believe that the current general situation in the currency exchange markets this week is unlikely to change significantly, since the distribution of net positions in the futures market clearly demonstrates, according to the reporting of Commitments of Traders (COT).

Forecast of the day:

EUR/USD is trading above the level of 1.0825. Weak statistics from Germany will put pressure on the pair. Thus, we believe it is possible to sell the pair after its decline below the level of 1.0825 with the target of 1.0785.

Spot gold is trading above the level of 1584.00. We expect resumption of its growth to 1592.70 if the price consolidates above the level of 1584.00.

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ExxonMobil is in debt. Oil is at 50.

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ExxonMobil is an integrated oil and gas company that is engaged in the exploration, production and processing of oil around the world. It is the world's largest processor and one of the world's largest producers of commercial and specialty chemicals.

Its net income for the fourth quarter of 2019 was $ 5.69 billion, as compared to its $ 6 billion of the previous year's quarter. The total dividend yield for 12 months is 5.74%, while the forward dividend yield is 5.74% as well.

On February 10, Chairman and Chief Executive Darren Woods bought 2,858 shares at $ 59.86. Since then, the share price has increased by 1.32%.

Now, XOM's market capitalization has shrunk, as technology stocks have taken over the world.

XOM did not grow, as since 2006, around the time when its share price was unchanged, its production, expressed in thousands of barrels of oil equivalent per day (MBOE), has actually declined.

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This is an incredibly long period of time, and it removes any doubts on temporary problems. For both oil and gas, global production has increased during this time. At the same time, XOM sold and bought assets during this time period, as well as invested very large amounts of capital in its projects.

By investing $ 25 billion a year, it is impossible to keep production unchanged, and it is obvious that there will be problems.

The jump in 2019 was quite noticeable. Although operating cash flow was about $ 30 billion, capital investment absorbed almost all of it. Moreover, the $ 14.7 billion dividend was funded primarily by asset sales and increased debt. The current period looks much worse than XOM prices in 2019.

Based on XOM's $ 30 billion capital investment plans, operating cash flows will only be reduced to capital expenditures in 2020. There should be no dividends.

Because of this, we can assume another odd increase of $ 15 billion in debt over the course of 2020. XOM will need an excess of $ 75 WTI in band price, as well as an excess of $ 3 in natural gas in order to sustainably finance the dividends and capex.

For now, the company will increase its debt to finance its dividends and capex (provided that the natural gas prices remain at the same level).

A more likely situation is that XOM will have to either cut its expenses, or pay the dividends. Targeting smaller projects with higher returns will help improve the balance between supply and demand, as well as stop the subsidization of global energy costs at the expense of shareholders.

You can evaluate energy prices positively, but XOM's capex and dividends simply do not allow to do this.

XOM problems are a sign of volatile commodity prices. The company can either accept this reality, or continue to dig itself a hole and promise a profit of "up to $ 35 per barrel." The correct approach is to return capital investments to where there is a steady return on invested capital. For this period though, it can be assumed that all the capital will be wasted. Perhaps, this may lead to a change in the company CEO. Ultimately, prices must rise to reflect what energy companies need to make money. It would be foolish to bet against XOM when the mood is so one-sided, so we should take a neutral point of view. However, based on a technical analysis, at the moment, there is no major increase expected on the company shares.

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We recommend working on short positions, with a pullback to the technical levels shown on the chart.

Good luck in trading and control your risks!

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EUR/USD Intraday Analysis: High and Low Of The Day For February 18, 2020

The High Of The Day and Low Of The Day from the CBDR (Central Bank Dealer Range) Range today are usually formed at STDV 2-STDV 4 under normal market conditions but sometimes the price can reach the STDV 5-STDV 6. Here are the levels for today:

STDV 10 - 1.0988.

STDV 9 - 1.0973.

STDV 8 - 1.0958.

STDV 7 - 1.0943.

STDV 6 - 1.0928.

STDV 5 - 1.0913.

STDV 4 - 1.0898.

STDV 3 - 1.0883.

STDV 2 - 1.0868.

STDV 1 - 1.0853.

CBDR - 1.0838.

==================

CBDR - 1.0823.

STDV 1 - 1.0808.

STDV 2 - 1.0793.

STDV 3 - 1.0778.

STDV 4 - 1.0763.

STDV 5 - 1.0748.

STDV 6 - 1.0733.

STDV 7 - 1.0718.

STDV 8 - 1.0703.

STDV 9 - 1.0688.

STDV 10 - 1.0673.

Pay attention to the level of confluence between today's & yesterday's range at 1.0913, 1.0898, 1.0808, 1.0793 & the previous Day High 1.0851 with the Previous Day Low 1.0829. All these levels can be a potential turning point level.

(Disclaimer)

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GBP/USD Intraday Analysis: High and Low Of The Day For February 18, 2020

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The High Of The Day and Low Of The Day from the Central Bank Dealer Range (CBDR) today are usually formed at STDV 2-STDV 4 under normal market conditions but sometimes the price can reach the STDV 5-STDV 6. Here are the levels for today:

STDV 10 - 1.3156.

STDV 9 - 1.3141.

STDV 8 - 1.3126.

STDV 7 - 1.3111.

STDV 6 - 1.3096.

STDV 5 - 1.3081.

STDV 4 - 1.3066.

STDV 3 - 1.3051.

STDV 2 - 1.3036.

STDV 1 - 1.3021.

CBDR - 1.3006.

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CBDR - 1.2991.

STDV 1 - 1.2976.

STDV 2 - 1.2961.

STDV 3 - 1.2946.

STDV 4 - 1.2931.

STDV 5 - 1.2916.

STDV 6 - 1.2901.

STDV 7 - 1.2886.

STDV 8 - 1.2871.

STDV 9 - 1.2856.

STDV 10 - 1.2841.

Pay attention to the level of confluence between today's & yesterday's range such at 1,2961, 1.2916 & the previous Day High 1.3053 with the Previous Day Low 1.2997. All these levels can be a potential turning point level.

(Disclaimer)

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

Indicator analysis. Daily review of EUR / USD on February 18, 2020

Trend analysis (Fig. 1).

The market may begin to move up today with the target at 1.0885, the retracement level of 14.6% (red 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:

An upward movement is expected today with the target at 1.0885, the retracement level of 14.6% (red dashed line).

An unlikely but possible scenario is from the resistance line 1.0827 (blue bold line), continued work down with the target 1.0744 locates at the lower border of the Bollinger line indicator (blue dashed line).

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Trading plan 02/18/2020 EURUSD. Coronavirus and others

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Coronavirus: 72,500 patients were ill and 1868 died in the morning of 02/18/2020.

The growth of cases per day is +1800, but this is much lower than the +10% pace a week ago.

China has managed to block the epidemic in one province of Hubei - the number of cases decreases outside - and the pace of the epidemic has significantly dropped.

But the economy will suffer: Air travel fell by 70%, many production facilities are not working - Apple announced a decline in sales.

EURUSD: Ready for another fall. Keep sales from 1.0990, sales from rebounds are possible - from 1.0880 and above.

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

Technical analysis of ETH/USD for 18/02/2020:

Crypto Industry News:

IOHK, a Cardano software company, has announced a $ 500,000 donation in Cardano to support and develop the Blockchain Research and Development Lab of the University of Wyoming (UW).

Professor James Caldwell, Assistant Professor Mike Borowczak and Philip Schlump will head the Advanced Blockchain Research and Development Lab.

Professor Borowczak said that the IOHK donation will be used to support students and PhD students in developing practical applications of real Blockchain use cases.

IOHK, founded by the co-founder of Ethereum, Charles Hoskinson, is based on the principles of peer-reviewed academic research. The company is involved in the development of open source software, authentication and anti-counterfeiting measures. For example, New Balance uses IOHK's Blockchain Cardano chain to authenticate its products to consumers.

According to Professor Caldwell, the IOHK donation will specifically help study the practical applications of Blockchain, such as supply chain management, traceability of goods and the development of smart contracts.

Technical Market Overview:

After the Shooting Star candlestick pattern had been made at the H4 timeframe chart around the level of $288.01, the bears took control over the market of ETH/USD and pushed the prices towards the level of $235. Currently, the market is trading around the level of $270 after the bounce has broken through the short-term trendline resistnace. Nevertheless, only a sustained breakout below the level of $229.81 might result in a larger counter-trend corrective cycle as this is the key short-term technical support.

Weekly Pivot Points:

WR3 - $358.03

WR2 - $324.90

WR1 - $285.60

Weekly Pivot - $248.62

WS1 - $213.91

WS2 - $176.19

WS3 - $141.12

Trading Recommendations:

The wave 2 corrective cycles are completed at the level of $115.05, so the market might be ready for another impulsive wave up of a higher degree and uptrend continuation. This strategy is valid as long as the level of $146.94 is not violated. The current move up might be a wave 3 in developing in the overall long-term Elliott wave scenario and so far the top at the level of $288.01 might be the wave 1 of the overall wave 3.

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Technical analysis of BTC/USD for 18/02/2020:

Crypto Industry News:

Bitcoin can reach and even exceed its record highs of $ 20,000 by the time of halving, which is expected to take place in May. This was the opinion of Mike Novogratz, a well-known venture capital investor who consistently supported Bitcoin.

Speaking in an interview with American television, Novogratz called Bitcoin "the best brand of the last eleven years" and said that 2020 will be the year in which it will challenge $ 20,000 again.

"At the moment Bitcoin seems to be a little crazy and we could see it growing, but I think that by the end of the year we could certainly pass old peaks, or at least reach them. We can literally be there for halving, i.e. in a few months" - he said .

Considering that altcoins beat Bitocin in terms of returns from January 1, Novogratz said Bitcoin "found its own path" as a unique means of thesaurization.

Technical Market Overview:

After the Bearish Engulfing candlestick pattern was made around the level of $10,430, the BTC/USD pair has moved south to the level of $9,412. Since then the bulls are trying to bounce and were able to almost hit the 38% Fibonacci retracement located at the level of $9,804. The momentum remains weak and negative so there is still a chance for another wave down. If the level of $9,555 is clearly violated, then the next target for bears is seen at the level of $9,508 and $9,123.

Weekly Pivot Points:

WR3 - $11,039

WR2 - $10,715

WR1 - $10,112

Weekly Pivot - $9,845

WS1 - $9,424

WS2 - $8,941

WS3 - $8,335

Trading Recommendations:

The market might have made the first impulsive wave up of a higher degree. This strategy is valid as long as the level of $7,582 is not violated. Nevertheless, the larger timeframe trend is still down and all the shorter timeframe moves are still being treated as a counter-trend correction inside of the uptrend until the level of $10,433 is clearly broken.

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Hot forecast for GBP/USD 02/18/2020 and trading recommendation

In general, as expected, while the Americans celebrated Presidents Day, the market stood rooted to the spot. Fortunately, as in the EU, no macroeconomic data was published.

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Today, the focus is on UK labor market data, which could cause the pound to decline further. The fact is that forecasts are rather moderately negative. Most indicators should remain unchanged. Especially the unemployment rate itself, which of course inspires some optimism. Moreover, the unemployment rate has been standing still for three months and is at its lowest level in recent years.

Unemployment Rate (UK):

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The growth rate of the average wage should remain unchanged, in contrast to salaries taking into account bonuses, the growth rate of which may slow down from 3.2% to 3.1%. And according to some forecasts, even up to 3.0%. Given that this indicator still largely reflects the willingness of employees to work more, since bonuses are mainly meant to be overtime, expectations are negative. This shows investors that the need for hiring additional workers is growing, which significantly increases staff costs. Which means it reduces profits.

Average salary, including bonuses (United Kingdom):

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Another negative factor may be data on changes in employment, as it should grow by 120 thousand, against 208 thousand in the previous month. That is, the growth rate of employment is clearly decreasing, which also does not usually please market participants.

Employment Change (UK):

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In terms of technical analysis, we see that the the price will return to the area of the psychological level of 1.3000, which was expected in the previous review. In fact, the fluctuation within the boundaries of 1.000/1.3070 comes to an end, where a peculiar accumulation at the peak of correction signals the resumption of the initial move.

Considering the trading chart in general terms, we see that the clock frequency has already changed, and overcoming the mark of 1.3000 is not uncanny. Thus, the main points in this process are the levels of 1.2885 and 1.2770.

It is likely to suggest that downward interest will continue in the market, and price taking will be lower than 1.3000. The prospect of a possible move is presented in the form of steps, where the first platform is located in the region of 1.2960.

From the point of view of a comprehensive indicator analysis, we see a steady downward interest in all major time intervals. In fact, the intersection of the psychological level of 1.3000 was the very starting point in the change of technical indicators.

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Technical analysis of GBP/USD for 18/02/2020:

Technical Market Overview:

The odds for a move up are now low than for a move up as the bears had pushed the price below the lower channel line around the level of 1.3000. Nevertheless, the move upwards looks corrective so far, and the breakout from the recent range might be the beginning of a larger correction to the downside and the next target for bears is seen at the level of 1.2823. In the meantime, the next technical resistance for the bulls is seen at the level of 1.3017 and the local support is seen at the level of 1.2988.

Weekly Pivot Points:

WR3 - 1.3333

WR2 - 1.3194

WR1 - 1.

Weekly Pivot - 1.3006

WS1 - 1.2943

WS2 - 1.2804

WS3 - 1.2739

Trading Recommendations:

The best strategy for current market conditions is to trade with the larger timeframe trend, which is up, so all downward market moves will be treated as local corrections in the uptrend. In order to reverse the trend from up to down in the longer term, 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 1.3512.

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Technical analysis of EUR/USD for 18/02/2020:

Technical Market Overview:

The EUR/USD pair has made another lower low at the level of 1.0823 and is still going down in a descending channel. All the bounces after the sell-offs had been shallow, so the bearish pressure is still high despite the extremely oversold market conditions. The momentum is still weak and negative and there is no indication of any trend reversal yet. The next target for bears is seen at the level of 1.0778 and the immediate technical resistance is seen at the levels of 1.0879 and 1.0885. Beware of short-squeeze.

Weekly Pivot Points:

WR3 - 1.1027

WR2 - 1.0991

WR1 - 1.0896

Weekly Pivot - 1.0858

WS1 - 1.0763

WS2 - 1.0726

WS3 - 1.0633

Trading Recommendations:

The best strategy for current market conditions is the same as it was for recent months: 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 larger timeframes like weekly, which indicates a possible downtrend termination soon. The key short-term levels are technical support at the level of 1.0981 and the technical resistance at the level of 1.1267.

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Elliott wave analysis of EUR/JPY for February 18, 2020

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The downside pressure from 122.88 continues as EUR/JPY has made a new lower low at 118.70. On the other hand, we are seeing a clear loss of downside momentum which indicates a bottom should be in place soon. Short-term a break above minor resistance at 119.27 is needed to signal a bottom is in place, while a break above resistance at 119.61 is needed to confirm that wave 2 has completed and wave three to above 122.88 is developing.

R3: 119.75

R2: 119.55

R1: 119.27

Pivot: 118.98

S1: 118.70

S2: 118.55

S3: 118.35

Trading recommendation:

We are long EUR from 119.35 with a 118.35 stop.

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GBP/USD: plan for the European session on February 18. Pound may resume growth, but good data on the UK labor market is necessary

To open long positions on GBP/USD you need:

Amid the lack of good news related to negotiations between the UK and the EU on a trade deal, buyers of the British pound are gradually losing optimism. Today there are important reports on the state of the labor market that may support the pound in the short term. Return and consolidation at the level of 1.3010 will be the first signal to open long positions in GBP/USD, which will lead to larger growth in the area of a high of 1.3052, on which the pair's further direction depends. Consolidating above this level, and this can happen only in case of good data on the growth of average earnings in the UK, will open a direct path to the areas of 1.3093 and 1.3133, where I recommend taking profits. In the scenario of maintaining pressure on the pound, it is best to return to long positions only after a false breakout is formed in the support area of 1.2967, but I recommend buying GBP/USD immediately for a rebound after updating a low of 1.2928.

To open short positions on GBP/USD you need:

Sellers took back support at 1.3010 during the Asian session, and the entire calculation is reduced to data on the state of the UK labor market. Poor performance can keep the bearish momentum in the market, and a false breakout forming at 1.3010 will be a direct signal to open short positions, which will lead to a test of lows 1.2967 and 1.2928, where I recommend taking profits. If the unemployment rate drops, then the bulls will regain the area of 1.3010. In this case, it is best to consider new short positions only after updating the high at 1.3052, or sell GBP/USD immediately for a rebound from the 1.3092 area with the aim of a downward correction of 20-30 points.

Signals of indicators:

Moving averages

Trading is carried out below 30 and 50 moving average, which saves the likelihood of the pound declining further.

Bollinger bands

A break of the lower boundary of the indicator in the region of 1.2990 will increase the pressure on the pair. Breakthrough of the upper level in the area of 1.3015 will cause GBP/USD to increase.

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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 February 18. Volatility will return. Markets are waiting for new reports on the

To open long positions on EURUSD you need:

Yesterday's low trading volume due to President's Day in the United States and the lack of important fundamental statistics did not cause the euro to fall further, however, it is still very early to say that the lows of the month have large buyers. The emphasis is shifted in the morning to the data on the index of moods in the business environment of Germany and the eurozone, on which the future direction of EUR/USD will depend. However, it is unlikely that the situation with euro purchases will somehow improve, so all attention again needs to be focused at 1.0830. One should be careful, and a return to 1.0830 with a false breakout forming there after the data will return the bulls to the market and then it would be possible to reach the resistance of 1.0860, a breakthrough of which will lead the pair to a high of 1.0886, where I recommend taking profit. In case the euro further falls to long positions, you can look at the rebound from a low of 1.0804, or even lower, in the support area of 1.0773.

To open short positions on EURUSD you need:

Yesterday, sellers did not put everything off the bat and began to act even before the pair approached the resistance of 1.0860, which only confirms the absence of those who are eager to buy euros in the current conditions. Bears also tried today to break below the support of 1.0830, but this did not lead to a major sale. Today, the main task of sellers in the first half of the day will be to break through the 1.0830 area, which may occur after weak reports on moods in the business environment of Germany and the eurozone, which will lead to selling the euro to the lows of 1.0804 and 1.0773, where I recommend taking profits. In the scenario of a small upward correction in EUR/USD, an unsuccessful attempt to consolidate above the resistance of 1.0860 will be another signal to open short positions. You can sell the euro immediately for a rebound from a high of 1.0886.

Signals of indicators:

Moving averages

Trading is carried out in the region of 30 and 50 moving average, which indicates the likely preservation of a downward correction.

Bollinger bands

Volatility has decreased, which does not provide signals for entering the market.

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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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Overview of the EUR/USD pair. February 18. The euro remains dominated by bears, which move the pair to 17-year lows

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) - down.

CCI: -84.5626

The first trading day of the week was completely sideways with minimal volatility. The euro/dollar pair has been trading all day as if it is not currently near three-year lows. The correction did not start on Monday, February 17, although an empty calendar of macroeconomic events could have contributed to its beginning. However, after several months, when the bears gave up positions on the approach to the minimum price values, the situation changed to the opposite. Now the bears continue to hold the initiative in their hands, despite the lack of a fundamental background.

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On Tuesday, the macroeconomic background for the EUR/USD pair will remain extremely weak. However, judging by the results of the first trading day of the week, a strong fundamental background is not particularly necessary for traders now. However, there will be just a couple of reports that are more or less significant. The first is an index of economic sentiment from the ZEW Center for European Studies for the European Union. The graph of all changes in the indicator over the past three years is placed above. As you can see, over the past year and a half, the index has been mostly below zero, which coincides with a temporary slowdown in the EU economy and a decline in the growth rate of industrial production. However, in the last two months (even 5 months), there has been a strong increase in the indicator and it is even difficult to say what it may be associated with. It should be understood that this index is not a business activity, it only reflects the mood of investors. Thus, the mood may be good and the key macroeconomic indicators of the European Union will continue to decline. In any case, there will most likely be no reaction to this report. Thus, we recommend that traders simply note the real value, whatever it may be.

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The second indicator is the ZEW Institute economic sentiment index for Germany, where the situation is approximately the same. The indicator has been in the negative zone for the last year and a half, but it has been growing in the last 5 years. Once again, first of all, ZEW indices are not important reports that traders respond to. Second, the growth in economic sentiment does not affect the key indicators of the German economy.

Thus, at the beginning of a new trading week, nothing changes for the European currency. There are no signs of improvement in the economic situation. No positive news. The European Central Bank remains silent on monetary policy issues. Christine Lagarde pays more attention to structural changes in the bank. The ECB's monetary committee is considering whether to lower the inflation target, which in recent years, despite all efforts, has not been achieved.

From a technical point of view, the downward movement continues, since this is what the "fast" indicator Heiken Ashi signals. Since any further decline will lead to the renewal of three-year lows, the pair does not have any important psychological levels from below. The nearest Murray level is "1/8"-1.0803. Both channels of linear regression are directed downward, as is the moving average line, which in total means a downward trend in the long-term, medium-term, and short-term plans. The CCI indicator has been near the oversold area for two weeks, but the persistent desire of traders to sell does not allow the euro to roll back from the current lows.

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The average volatility of the euro/dollar currency pair has decreased to 41 points per day and is again approaching the "minimum" value. On average, the pair continues to pass 40-50 points per day, but the last two days ended with minimal volatility. On Tuesday, we expect movement between the borders of the volatility corridor of 1.0792-1.0874, but given the macroeconomic background, it is unlikely that at least one of the borders will be reached, and volatility will increase.

Nearest support levels:

S1 - 1.0803

S2 - 1.0742

S3 - 1.0681

Nearest resistance levels:

R1 - 1.0864

R2 - 1.0925

R3 - 1.1047

Trading recommendations:

The euro/dollar pair continues to move down. Thus, sales of the euro with targets of 1.0803 and 1.0783 remain relevant now, which can be kept open until the Heiken Ashi indicator turns up. It is recommended to buy the EUR/USD pair no earlier than the bulls cross the moving average line with the first target of 1.0925.

In addition to the technical picture, you should also take into account the fundamental data and the time of their release.

Explanation of the illustrations:

The highest linear regression channel is the blue unidirectional lines.

The lowest linear regression channel is the purple unidirectional lines.

CCI - blue line in the indicator window.

Moving average (20; smoothed) - blue line on the price chart.

Murray levels - multi-colored horizontal stripes.

Heiken Ashi is an indicator that colors bars in blue or purple.

Possible variants of the price movement:

Red and green arrows.

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Forecast for EUR/USD on February 18, 2020

EUR/USD

Monday was quiet for the euro, since the United States had a public holiday. The price has gained some strength at the Fibonacci reaction level of 161.8% and today in the Asian session it is already deeper than yesterday's low. The immediate goal of the euro at 1.0745 is the underlying Fibonacci level of 200.0%. And since the embedded line of the blue price channel is already relatively close, we are waiting for the price to reach the second target level of 1.0680, formed by the reaction level of 223.6% and this line of the price channel. Probably, the 1.0650/80 range will be worked out, the lower boundary of which is formed by the reaction level of 238.2%.

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On a four-hour chart, the signal line of the Marlin Oscillator is turning from the boundary with the growth territory. The trend on the main work schedules is completely bearish.

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In addition, today, the ZEW Institute will release data on moods in business circles for the current month, the forecast is pessimistic: in Germany it is expected to decrease from 26.7 to 20.0-21.5 points, in the euro area a decrease from 25.6 to 21.3- 25.0 points.

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Forecast for GBP/USD on February 18, 2020

GBP/USD

The British pound fell 40 points on Monday. The price did not struggle with the resistance of the Fibonacci level of 76.4% (in fact, this is the correction level of 23.6%, since the Fibonacci retracement is upside down), and currently the signal line of the Marlin oscillator is in the decreasing trend zone, in the zone of negative values.

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The 1.2845 target at the reaction level of 110.0% is open, but there is a condition on the chart of a smaller scale.

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The price should overcome the MACD line on H4, below the level of 1.2968. The Marlin Oscillator is in the decreasing trend zone, which greatly increases the likelihood of successfully breaking support.

In addition, employment in the UK should be published today. An increase in applications for unemployment benefits in January is expected to be from 15 thousand to 23 thousand, the average level of wages including premiums for December is expected to be 3.0% against 3.2% earlier. The overall unemployment rate is so far projected unchanged at 3.8%. We are waiting for the pound to fall to the designated target. The second target 1.2758 is the Fibonacci level of 123.6%.

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Forecast for AUD/USD on February 18, 2020

AUD/USD

A minutes was issued from the last RBA meeting on monetary policy this morning. Committee members agreed that the economy will slightly decline in the medium term due to drought and the outbreak of SARS in China. By the end of the year, financial politicians are waiting for the economy to grow, pending the growth of investment in fixed assets. This made market participants doubt such optimism, since the IMF expects the global economy to weaken by the end of the year. It was also mentioned that the committee was considering options for lowering the rate, but decided to postpone and leave room for maneuver in the event of a worsening economic situation. In general, the rates are supposed to be kept at a low level for quite a long time.

This release, of course, did not contribute in any way to purchases of the Australian dollar and the aussie lost more than 20 points in the Asian session. The Australian dollar's technical reversal occurred from the Fibonacci level of 161.8% yesterday. The target is 0.6624 in terms of the Fibonacci level of 223.6% and the support of the price channel line is open. Perhaps there will be a breakout of the level, and the price will reach 0.6595 at the Fibonacci level of 238.2%. After this movement, a correction is likely.

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On the H4 chart, the price crossed both indicator support lines - the balance line (red) and the MACD line (blue). Marlin is declining in the negative trend zone. The Australian dollar will continue to decline.

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Fractal analysis of the main currency pairs for February 18

Forecast for February 18 :

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: 1.0938, 1.0910, 1.0888, 1.0864 and 1.0827. Here, the price is near the limit values for the downward cycle, and therefore, we expect a correction. Short-term upward movement is expected in the range of 1.0864 - 1.0888. The breakdown of the last value will lead to the development of correction. Here, the goal is 1.0910. This level is a key support for the downward structure and its passage at the price will lead to the formation of expressed initial conditions for the upward cycle. In this case, the potential target is 1.0938.

The main trend is a downward structure from January 31, we expect a correction

Trading recommendations:

Buy: 1.0864 Take profit: 1.0887

Buy: 1.0888 Take profit: 1.0910

Sell: Take profit:

Sell: Take profit:

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For the pound / dollar pair, the key levels on the H1 scale are: 1.3182, 1.3157, 1.3114, 1.3082, 1.3045, 1.2990, 1.2961 and 1.2928. Here, we are following the development of the ascending structure of February 10. The continuation of the movement to the top is expected after the breakdown of the level of 1.3045. In this case, the target is 1.3082. Short-term upward movement, as well as consolidation is in the range of 1.3082 - 1.3114. The breakdown of the level of 1.3114 will lead to a pronounced movement. In this case, the potential target is 1.3157. Upon reaching which, we expect a consolidated movement in the range 1.3157 - 1.3182, as well as a correction.

Short-term downward movement is possibly in the range of 1.2990 - 1.2961. The breakdown of the latter value will lead to an in-depth correction. Here, the target is 1.2928. This level is a key support for the upward structure.

The main trend is the ascending structure of February 10.

The main trend is the rising structure of February 10th.

Trading recommendations:

Buy: 1.3045 Take profit: 1.3080

Buy: 1.3083 Take profit: 1.3112

Sell: 1.2990 Take profit: 1.2962

Sell: 1.2959 Take profit: 1.2930

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For the dollar / franc pair, the key levels on the H1 scale are: 0.9858, 0.9826, 0.9810, 0.9787, 0.9771, 0.9743 and 0.9719. Here, we are following the local ascendant structure of February 12. Short-term upward movement is expected in the range of 0.9810 - 0.9826. The breakdown of the latter value will lead to movement to a potential target - 0.9857. We expect a pullback to the bottom from this level.

Short-term downward movement is possibly in the range of 0.9787 - 0.9771. The breakdown of the latter value will lead to the development of a downward structure. In this case, the first potential target is 0.9743. We expect expressed initial conditions for a downward cycle to the level of 0.9719.

The main trend is the local potential for the top of February 12

Trading recommendations:

Buy : 0.9810 Take profit: 0.9824

Buy : 0.9827 Take profit: 0.9856

Sell: 0.9787 Take profit: 0.9773

Sell: 0.9769 Take profit: 0.9745

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For the dollar / yen pair, the key levels on the scale are : 110.80, 110.47, 109.99, 109.62, 109.41 and 109.07. Here, we are following the development of the ascending structure of January 31. The continuation of the movement to the top is expected after the breakdown of the level of 110.00. In this case, the target is 110.47. Price consolidation is near this level. For the potential value for the top, we consider the level 110.80. Upon reaching which, we expect a pullback to the bottom.

Short-term downward movement is possibly in the range of 109.62 - 109.41. The breakdown of the latter value will lead to an in-depth correction. Here, the goal is 109.07. This level is a key support for the top.

Main trend: upward structure of January 31

Trading recommendations:

Buy: 110.00 Take profit: 110.45

Buy : 110.49 Take profit: 110.80

Sell: 109.60 Take profit: 109.42

Sell: 109.38 Take profit: 109.10

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For the Canadian dollar / US dollar pair, the key levels on the H1 scale are: 1.3303, 1.3281, 1.3267, 1.3228, 1.3201 and 1.3165. Here, the descending structure of February 10 is considered medium-term. The continuation of movement to the bottom is expected after the breakdown of the level of 1.3228. In this case, the target is 1.3201. Price consolidation is near this level. The breakdown of the level of 1.3200 will lead to the development of pronounced movement to the bottom. Here, the potential target is 1.3165. We expect a pullback to the top from this level.

Short-term upward movement is possibly in the range of 1.3267 - 1.3281. The breakdown of the latter value will lead to an in-depth correction. Here, the target is 1.3303. This level is a key support for the downward structure.

The main trend is the formation of medium-term initial conditions for the downward movement of February 10

Trading recommendations:

Buy: 1.3267 Take profit: 1.3281

Buy : 1.3283 Take profit: 1.3303

Sell: 1.3226 Take profit: 1.3203

Sell: 1.3199 Take profit: 1.3167

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For the Australian dollar / US dollar pair, the key levels on the H1 scale are : 0.6810, 0.6776, 0.6761, 0.6739, 0.6703, 0.6684 and 0.6660. Here, we are following the development of the ascending structure of February 7. The continuation of the movement to the top is expected after the breakdown of the level of 0.6740. In this case, the target is 0.6761. Short-term upward movement, as well as consolidation is in the range of 0.6761 - 0.6776. For the potential value for the top, we consider the level of 0.6810. Upon reaching which, we expect a pullback to the bottom.

Consolidated movement is possibly in the range of 0.6703 - 0.6684. Hence, the high probability of a reversal to the top. The breakdown of the level of 0.6684 will lead to the formation of a downward structure. Here, the potential target is 0.6660.

The main trend is the upward structure of February 7

Trading recommendations:

Buy: 0.6740 Take profit: 0.6761

Buy: 0.6762 Take profit: 0.6775

Sell : Take profit :

Sell: 0.6682 Take profit: 0.6660

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For the euro / yen pair, the key levels on the H1 scale are: 119.85, 119.51, 119.26, 118.80, 118.36 and 118.13. Here, we are following the descending structure of February 5. The continuation of movement to the bottom is expected after the breakdown of the level of 118.80. In this case, the goal is 118.36. For the potential value for the bottom, we consider the level of 118.13. Upon reaching which, we expect consolidation, as well as a pullback to the top.

Short-term upward movement is possibly in the range of 119.26 - 119.51. The breakdown of the last value will lead to an in-depth correction. Here, the goal is 119.85. This level is a key support for the downward structure.

The main trend is the descending structure of February 5

Trading recommendations:

Buy: 119.26 Take profit: 119.50

Buy: 119.55 Take profit: 119.85

Sell: 118.80 Take profit: 118.38

Sell: 118.34 Take profit: 118.14

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For the pound / yen pair, the key levels on the H1 scale are : 145.19, 144.57, 144.12, 143.50, 142.75, 142.47 and 142.08. Here, we revised the key targets for the upward structure of February 10. The continuation of movement to the top is expected after the breakdown of the level of 143.50. In this case, the target is 144.12. The breakdown of this value will lead to short-term upward movement in the range 144.12 - 144.57. Hence, there is also a high probability of a reversal to correction. For the potential value for the top, we consider the level of 145.19. Upon reaching this level, we expect a pullback to the bottom.

Short-term downward movement, as well as consolidation, are possible in the range of 142.75 - 142.47; hence, the likelihood of a reversal to the top. The breakdown of the level of 142.47 will lead to an in-depth correction. Here, the goal is 142.08. This level is a key support for the top.

The main trend is the rising structure of February 10

Trading recommendations:

Buy: 143.50 Take profit: 144.12

Buy: 144.15 Take profit: 144.50

Sell: 142.75 Take profit: 142.50

Sell: 142.44 Take profit: 142.10

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GBP/USD. Unemployment, inflation, retail: pound awaits key reports

The fundamental background for the British currency remains very controversial: the pound is gradually losing ground today following a surge of optimism last week. Given the rather harsh rhetoric of the representatives of London and Brussels, it can be assumed that the downward trend will continue. In addition, tomorrow's data on the growth of the UK labor market may also put pressure on the GBP/USD pair, especially if the average earnings level disappoints. Key indicators of UK inflation and retail sales data will also be published this week. All these reports will complement the overall fundamental picture for the GBP/USD pair.

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But let's start with politics. As you know, over the past few years (to be more precise, since 2016), the pound has been trading in its "coordinate system", sharply reacting to the news flow regarding Brexit's prospects. Now Brexit is behind us, but the degree of intensity is still high: negotiations during the transition period began with harsh statements, both from the Europeans and the British. Boris Johnson recently threatened to leave the negotiation process, while Brussels promised Spain support in the matter of territorial claims regarding Gibraltar. Today, a kind of "exchange of pleasantries" continued: French Foreign Minister Jean-Yves Le Drian said that both sides are far apart on a number of issues. However, he warned the UK that she should expect a "bloody battle" in the upcoming talks. The Foreign Minister of France also repeated the words of the head of the European Commission that it would be difficult for Britain to achieve the goal of concluding a free trade deal before the end of the year.

It is worth noting that the French have always expressed a tougher stance towards the British compared to other Europeans. For example, at the time, Paris was always hostile to the idea of postponing Brexit and extending the negotiation process. Only at the last moment did the French support the common decision of the leaders of the EU countries. Judging by the first comments by French officials, the upcoming talks will indeed become a real diplomatic test.

Meanwhile, the British retail consortium, in a published statement, warned that consumers could face higher costs and reduced availability of goods if a free trade deal was not reached by the end of the year. Representatives of the consortium recalled that 80% of all food products imported by British retailers came from the EU, and this fact makes these negotiations "especially important for these essential goods". Such a remark against the backdrop of harsh statements by Paris put background pressure on the pound.

In the coming days, the attention of GBP/USD traders will switch to macroeconomic reports - unless, of course, British and European politicians increase the verbal pressure on the currency. If you exclude this scenario, the upcoming releases may have a significant impact on the pair. Let me remind you that the Bank of England unexpectedly maintained an "optimistic and expectant" position at its last meeting, contrary to the pessimistic forecasts of most experts. Nevertheless, the English regulator did not rule out a reduction in the interest rate in the foreseeable future, and two members of the Committee have already voted for this decision for several meetings. And if key indicators this week come out in the red zone, then the likelihood of monetary policy easing this spring will increase again.

Key data on the growth of the labor market in Britain will be released tomorrow, February 18. According to general forecasts, the unemployment rate will remain at a record low of 3.8%. However, the number of applications for unemployment benefits may significantly increase - up to 22 thousand. Salaries can demonstrate a downward movement: the increase in the average earnings should slow down to 3.1% with premiums and up to 3.3% without them. If the inflationary component of tomorrow's release comes out in the red zone, the pound will come under significant pressure, especially in anticipation of the publication of basic inflation data.

We will find out the growth dynamics of the British consumer price index on Wednesday, February 19. Preliminary forecasts are contradictory: the overall index on a monthly basis should slow down to -0.4%, and in annual terms, grow to 1.7% (after a decline to 1.3%). Core inflation can also grow up to 1.5%. For bulls of the pair, it is important that inflation data come out at least at the forecast level, otherwise the bears will get a weighty argument for selling the pair.

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Data on retail sales in the UK will be published on Thursday. This release will be the last puzzle that will form the overall fundamental picture for the pound. According to general forecasts, retail sales will please GBP/USD bulls: on a monthly basis, the indicator will leave the negative area where it has been for the past three months (both taking into account fuel costs and excluding this component). A slight slowdown is expected in annual terms.

Thus, according to preliminary forecasts, key macroeconomic reports will show mixed dynamics. If the releases turn out to be one-way, then the volatility for the GBP/USD pair will be much higher: by the end of the week, the probability of a rate cut at the March meeting will either increase or decrease even more. From a technical point of view, the pair is also at a crossroads - 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. From a fundamental point of view, a similar picture has developed: traders are waiting for information drivers that will push the pair either into the region of 28-29 figures, or towards the 31st price level.

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EUR/USD and GBP/USD. February 17. Results of the day. French Foreign Ministry warns of difficult negotiations and war over

4-hour timeframe

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Amplitude of the last 5 days (high-low): 49p - 34p - 60p - 55p - 33p.

Average volatility over the past 5 days: 47p (average).

The EUR / USD currency pair was not able to start an upward correction on Monday, February 17, although no important macroeconomic events were planned for the day. Thus, bulls continue to be absent from the market for the third week in a row. The euro/dollar pair does not have enough strength to move away from three-year (!!!) lows by at least 50 points, and the euro's total fall in recent weeks is already 260 points. Traders were simply resting throughout the day, not selling or buying the pair. Low volatility (29 points at the moment) absolutely clearly characterizes the fundamental background of Monday. However, we are most interested in answering the question of when the corrective movement will begin and under what conditions. One gets the impression that it will begin abruptly, upon reaching any level at which large purchase orders are located. Thus, one thing can now be ascertained with certainty. Bears continue to dominate the market, the pair is likely to continue to fall, despite the fundamental background.

We have already said that today there were no macroeconomic publications in the EU or the US, even secondary ones. President's Day is being celebrated in the States today, and all banks were closed. Thus, we now consider it appropriate to continue to trade lower, or rather, to maintain short positions already opened earlier, since there are still no signs of the beginning of a correction. It is unlikely that they will appear tomorrow, since the calendar of macroeconomic events does not contain anything interesting on February 18. Thus, we believe that as long as the price is trading below the Kijun-sen critical line, we can continue to hold open sell positions. Moreover, the downward trend movement is rather weak, so the Kijun-sen line is constantly kept close to the price.

4-hour timeframe

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Amplitude of the last 5 days (high-low): 74p - 74p - 43p - 126p - 62p.

Average volatility over the past 5 days: 76p (average).

At the same time, the British pound began to adjust against the upward trend that has developed in recent days. The pound/dollar pair, in fact, could not overcome the Senkou Span B line of the Ichimoku indicator and will now try to resume the downward trend. We said in recent reviews that the British currency still has no good reason to go up against the dollar. But there are plenty of reasons for it to become cheaper against the US currency. For example, today it became known that negotiations between London and Brussels are becoming more complicated, before they even begin. As we mentioned in previous reviews, the positions of London and Brussels are obvious. London wants a trade deal and does not submit to the European Union in any area, that is, to distance itself from the bloc as much as possible, and the EU wants to continue to influence as many spheres of life in Great Britain as possible and in return offers a profitable trade deal. It is precisely taking into account the fact that the parties are still at different poles, we still believe that there will be no trade deal. And it seems that we are not the only ones who think so, but also most of the world's experts. Sources close to Boris Johnson's office said today that London considers Brussels' desire to force Britain to continue to comply with European standards after Brexit as "ridiculous". This applies to all norms, but, in particular, we are talking about the norms of state subsidies and tax standards. It is easy to guess that Brussels wants London to continue to comply with European rules in these areas, as it wants to highly protect European companies from unfair competition from the British. The British government also noted that neither Canada nor Japan were subject to such requirements by the European Union, however, it concluded trade agreements with them. The source reiterated that Britain will not take on the responsibility of strictly adhering to European norms and standards. Well, Johnson's position personally confirms this information: if the EU'S proposal does not suit London, then Johnson is ready to curtail any negotiations with the EU and leave the bloc without a deal. That is, in fact, there will be Brexit "without a deal."

At the same time, French Foreign Minister Jean-Yves Le Drian said that he also considers future negotiations between the bloc and the UK extremely difficult. "I think that we will tear each other apart in the negotiations," said Jean-Yves Le Drian. "However, this is an absolutely normal phenomenon, each side will protect its interests," the foreign minister stressed. The head of the French Foreign Ministry also noted that the chances of concluding a trade deal before the end of 2020 are few. France is also firm in its position, which is expressed by the desire to continue to fish in British waters. Great Britain wants to limit or even completely exclude the access of other states to "its waters." In addition, it is also reported that almost 80% of imported food products from the UK come from the EU. The retailer community has already warned Johnson's government that a number of food products could skyrocket in the UK if a trade deal cannot be reached. A shortage may form for certain products.

In general, as we said earlier, the UK, led by Johnson, is rushing at all times to the "hard" Brexit. Naturally, nothing changes for the GBP/USD pair in the fundamental plan, so the pound will still be prone to fall. Therefore, each sell signal from Ichimoku is a strong priori. From a technical point of view, the pound continues to adjust, but is located above the Kijun-sen line, so the upward trend continues.

Trading recommendations:

The EUR/USD pair keeps the downward movement. Thus, it is now recommended that you stay selling the euro with a target support level of 1.0786. The MACD indicator is discharging again. It will be possible to consider purchases of the euro/dollar pair in small lots with the goal of the Senkou Span B line, if traders manage to gain a foothold above the Kijun-sen line, which is not expected in the near future.

GBP/USD began to adjust against the upward trend. Thus, it will be possible to sell the British pound with targets at levels of 1.2967 and 1.2920 only after the price has consolidated below the critical line. Buying the pair of small lots can be considered with a target of 1.3118 if traders overcome the Ichimoku cloud, but it should be understood that the fundamental factors do not remain on the side of the British currency.

Explanation of the illustration:

Ichimoku indicator:

Tenkan-sen is the red line.

Kijun-sen is the blue line.

Senkou Span A - light brown dotted line.

Senkou Span B - light purple dashed line.

Chikou Span - green line.

Bollinger Bands Indicator:

3 yellow lines.

MACD indicator:

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

Support / Resistance Classic Levels:

Red and gray dashed lines with price symbols.

Pivot Level:

Yellow solid line.

Volatility Support / Resistance Levels:

Gray dotted lines without price designations.

Possible price movements:

Red and green arrows.

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

Trading plan for EUR/USD on February 17, 2020

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The epidemic in China remains to be a major nuisance to the markets.

On the morning of February 17, 71 thousand people were infected, 1,770 have died, and 10.6 thousand have recovered. The epidemic is still localized in one province of China, Hubei, and its capital, Wuhan.

Chinese authorities have imposed a death penalty to those who violate the quarantine, cause the virus to spread, and infect other people intentionally.

Chinese authorities also introduced a quarantine for banknotes. New banknotes worth $ 80 billion have been issued, while the potentially infected ones have been sent to quarantine.

Outside of China, the maximum number of infected people does not exceed 1000.

The rate of the increase of the number of cases seems to be decreasing. However, there is no certainty that this decline in the rate of the spread of the virus will continue.

Other than that, everything is calm in the markets. US indices closed the week at historical highs, while oil drew a strong bottom at $ 50. Moreover, it seems that it's not going to fall.

EUR/USD: the euro remains under pressure from the sellers.

It looks very weak, and seems to be ready for a new fall.

Keep selling from 1.0990.

From 1.0900 and above, sales with rebounds to the top are possible.

The correction can reach 1.0945 in the afternoon.

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

Indicator analysis. Daily review of GBP / USD on February 17, 2020

The pair continued to move up on Friday, breaking through the pullback level of 50.0% equivalent to 1.3041 (red dotted line). Strong calendar news is not expected today. Also, the market in the US will be narrow. Perhaps the upward movement will continue with the first target 1.3081, the retracement level of 61.8% (red dashed line).

Trend analysis (Fig. 1).

From the pullback level of 50.0% equivalent to 1.3041 (red dashed line), an upward movement is possible today with the target 1.3081, the rollback level of 61.8% (red dashed line). If this level is reached, there is a roll back down with the target 1.3007, the support line (red bold line).

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Fig. 1 (daily chart).

Comprehensive analysis:

- Indicator analysis - up;

- Fibonacci levels - up;

- Volumes - up;

- Candlestick analysis - down;

- Trend analysis - up;

- Bollinger Lines - up;

- Weekly schedule - up.

General conclusion:

Today, the price may continue to move up.

An unlikely but quite possible scenario is from a pullback level of 50% equivalent to 1.3041 (red dashed line), work down with the target 1.2944, the lower fractal (red dashed line).

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