USD/JPY – take profit!

Congratulations to those who took advantage of yesterday's idea to sell USDJPY.

Let me remind you that the idea was to work out the short initiative for the breakdown of the area of 108.4-108.2

Plan:

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Adjustment:

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The passage was a little more than 500 p and worked on the same day.

Good luck with trading and control risks!

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Simplified wave analysis of EUR/ USD, AUD/USD, and GBP/JPY on January 3

EUR/USD

Analysis:

The upward wave from September 3 to the present time demonstrates the completeness of its structure. The price has reached the lower limit of the wide potential reversal zone. In the last 3 days, the price moves down, forming a correction of the last part (C). The price is in the support area.

Forecast:

Due to the high wave level, the downward movement can be continued, turning into a full-fledged correction of the entire main wave. Today, the price is expected to move sideways. In the first half of the day, an upward vector is more likely. If the volatility decreases, the pair may increase.

Potential reversal zones

Resistance:

- 1.1230/1.1260

Support:

- 1.1170/1.1140

- 1.1090/1.1060

Recommendations:

Purchases of the euro are possible today as part of session trading with a reduced lot. Sales of the instrument will become more promising.

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AUD/USD

Analysis:

The dominant wave on the chart of the "Australian" has a downward course but is formed in the form of an incorrect design. On the chart, it looks like an upward pennant. Its structure still lacks the final part. The price has reached an intermediate resistance level.

Forecast:

A reversal on the final decline can occur at any time. The trend change will likely occur from the current resistance. In the first half of the day, a rollback of the course is possible today. A lateral flat is likely, but a short-term rise to the resistance area is not excluded. A return to decline can be expected by the end of the day.

Potential reversal zones

Resistance:

- 0.7010/0.7040

Support:

- 0.6950/0.6920

- 0.6870/0.6840

Recommendations:

Buying a pair in the coming sessions can be risky. It is recommended that the main attention be paid to the search for instrument selling signals.

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GBP/JPY

Analysis:

As part of the main wave, a bearish wave has been forming since December 13. Previously, it will take the place of correction of the entire wave. There was a clear zigzag in the structure of the movement. The decline that began on December 31 may give rise to the final part (C).

Forecast:

The downward trend of the cross movement is expected to continue in the coming sessions. The nature of the movement is likely to be impulsive.

A short-term pullback is possible from the nearest support. Most likely, there will be a "sideways", but the option of a rebound to the resistance zone cannot be excluded.

Potential reversal zones

Resistance:

- 141.60/141.90

Support:

- 141.00/140.70

- 140.00/139.70

Recommendations:

The purchase of the pair today is unpromising. At the ends of all counter price movements, it is recommended to track the reversal signals to find the pair's selling points.

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Explanations: In the simplified wave analysis (UVA), waves consist of 3 parts (A-B-C). The last incomplete wave is analyzed. The solid background of the arrows shows the formed structure, the dotted background shows the expected movements.

Attention: The wave algorithm does not take into account the duration of the tool movements in time!

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EUR/USD. Market is nervous - dollar is growing: the killing of an Iranian general has stirred up the currency market

The fundamental background in the currency exchange market has changed dramatically literally in a day: anti-risk sentiment has prevailed again, increasing interest in protective instruments. The yen is already testing the 107th figure, and gold has updated a 3-month high, showing impulse growth. At the same time, the American currency was also among the beneficiaries of this situation: the dollar index is growing, as the dollar is traditionally in demand during periods of geopolitical tensions.

It should be noted right away that anti-risk sentiments are growing not only due to the assassination of the Iranian military leader by the US military - the latest news from the DPRK and Turkey also made their respective contributions. Due to this, recent events have been overshadowed by many fundamental factors that traders of the EUR/USD pair have focused on. Moreover, optimism regarding the prospects for US-Chinese relations gave way to anxiety about a possible retaliatory action by Iran. Indeed, in the opinion of the overwhelming number of political experts, the Iranians will take retaliatory steps in any case - the only question is how large and deadly they will be. Such a nervous situation puts pressure on EUR/USD, primarily due to the growth of the American currency throughout the market.

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Let me remind you that the international airport in Baghdad was bombed last night, as a result of which the Iranian general Qassem Soleimani, who led the special unit of the Islamic Revolutionary Guard Corps, was killed. A few hours after the air raid, a Pentagon message appeared according to which a senior Iranian military commander was liquidated on the personal instructions of US President Donald Trump. In addition to General Soleimani, another 8 people died, including the deputy head of the pro-Iranian armed group Al-Hashd al-Shaabi, Abu Mahdi al-Muhandis. According to the American authorities, General Soleimani was engaged in "developing plans for an attack on US diplomats and members of the diplomatic service in Iraq and throughout the region." Moreover, The Pentagon accused Soleimani of approving the assault on the US embassy in Baghdad by supporters of the Kata'ib Hezbollah militia. This attack was committed on the last day of 2019.

As many analysts note, the death of such a high-ranking Iranian military official could be a turning point in the relations between Washington and Tehran. Iran's supreme leader, Ayatollah Ali Khamenei, has already promised "severe revenge" to those who killed the commander of the Iranian elite unit. Iranian Foreign Minister Javad Zarif, in turn, called the killing of Soleimani an act of international terrorism. After these threats, US authorities ordered the Armed Forces to be fully operational.

On the other hand, there is no consensus among experts about possible actions on the part of Tehran, and indeed - what will lead to another aggravation of the US rivalry with Iran. Many analysts believe that Iranians are attacking American targets in Iraq. The US command has already deployed additional forces to protect the US Embassy in the country, including a hundred marines and combat helicopters. Infrastructure or military facilities (or representatives) of US allies in the region may also be affected - first of all, we are talking about Saudi Arabia and Israel.

In the context of the currency market, the very fact of growing geopolitical tensions is important and not only military in nature. Let me remind you that in 2013, Iran threatened to block the Strait of Hormuz (though it did not fulfill its intentions at that time) - and now, there is a probability that Tehran will resume such threats. Meanwhile, oil has already updated its multi-month highs (in particular, Brent is approaching the $ 70 mark), exerting a corresponding effect on commodity currencies. If "black gold" holds out at these price heights, the European currency will receive its "reward" (though in time), as the growth of the oil market will positively affect inflation in the eurozone. But all this will be later: at the moment, the market is focused on possible retaliatory actions by Iran with regard to the States or their allies.

As I said above, the assassination of an Iranian general is not the only cause for concern for traders. North Korea made itself known again, and, as they say, "not on the best side" - on December 31, DPRK leader Kim Jong-un announced plans to no longer extend the moratorium on nuclear weapons tests. Earlier, the chief of the General Staff of the Korean People's Army, Park Jong-chon, declared the risk of the development of relations between the DPRK and the United States into a "full-scale armed conflict." The Pentagon, in turn, announced the readiness of the American side to respond to possible aggression from North Korea.

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The fundamental picture of the day was supplemented by news from Turkey. Yesterday, the parliament of this country approved the sending of troops to Libya. The adopted document states that this conflict will affect Turkey's interests in the Mediterranean basin and in northern Africa if the Libyan government cannot stop the advance of the rebels and the clashes turn into a mass civil war. In other words, Ankara decided to intervene in the internal Libyan conflict, which has been in an active phase for almost a year. One side of the conflict is the internationally recognized government of national unity, which controls Tripoli, the other side is the "Tobruk government", whose armed forces are commanded by the leader of Libyan militias Khalifa Haftar.

Thus, the strengthening of geopolitical tensions will continue to exert pressure on the pair EUR/USD, due to the strengthening of the dollar. The pair overcame the support level of 1.1150 (Tenkan-sen line on the daily chart) and will probably overcome the second support level of 1.1110 (Kijun-sen line on the same time-frame). Most likely, the price will stop its decline in the area of 1.1060 - this is the upper border of the Kumo cloud on D1.

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Technical analysis of AUD/USD for January 03, 2019

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Overview:

Pivot: 0.6887.

The AUD/USD pair is continuing trading upwards from the level of 0.6887. Last time, the pair rose from the level of 0.6887 to the top around 0.6936. Subsequently, it should be noted that the level of 0.6887 coincides with the ratio of 23.6% Fibonacci retracement levels. The AUD/USD pair broke resistance at the level of 0.6887 which turned into strong support at the golden ratio. In the H1 time frame, the level of 0.6887 is expected to act as major support today. Currently, the price is moving in a bullish channel. This is confirmed by the RSI indicator signaling that we are still in a bullish market. To summarise, the price is still above the moving average (100) and (50). From this point, we expect the AUD/USD pair will be continuing to move in the bullish trend from the support level of 0.6887 towards the target level of 0.6940. The double top is set at the point of 0.6940 at the same time frame. If the pair succeeds in passing through the level of 0.6940, the market will indicate the bullish opportunity above the level of 0.6940 so as to reach the second target at 0.6969. On the contrary, in case a reversal takes place and the AUD/USD pair breaks through the support level of 0.6887, a further decline to 0.6801 can occur in order to indicate a bearish market. Overall, we still prefer the bullish scenario, which suggests that the pair will stay above the zone of 0.6887.

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Technical analysis: Important intraday levels for EUR/USD, January 03, 2020

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When the European market opens, some economic data will be released such as Private Loans y/y, M3 Money Supply y/y, German Unemployment Change, Spanish Unemployment Change, French Prelim CPI m/m, and German Prelim CPI m/m. The US will also present a series of economic reports such as Crude Oil Inventories, Natural Gas Storage, Total Vehicle Sales, ISM Manufacturing Prices, Construction Spending m/m, and ISM Manufacturing PMI. So amid the reports, EUR/USD will move with low to medium volatility during this day. TODAY'S TECHNICAL LEVELS: Breakout BUY Level: 1.1229. Strong Resistance: 1.1223. Original Resistance: 1.1212. Inner Sell Area: 1.1201. Target Inner Area: 1.1175. Inner Buy Area: 1.1149. Original Support: 1.1138. Strong Support: 1.1127. Breakout SELL Level: 1.1121. Disclaimer: Trading Forex on margin carries a high level of risk, and may not be suitable for all traders or investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts. The material has been provided by InstaForex Company - www.instaforex.com

Is euro always in the background?

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Many analysts agree that the position of the European currency paired with the American will always remain secondary. Last year, the "European" currency made several attempts to get around the dollar, but this was rarely possible. The dollar regained its position again, and the euro had to be contented with the second line in the rating of world currencies.

Moreover, the EUR / USD pair added 200 points shortly before the New Year, reaching 1.1231. In the future, a sharp jump gave way to a price pullback, which is not surprising for the pre-holiday market.

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At the same time, significant support for the European currency was provided by strong data on business activity in the eurozone manufacturing sector for December 2019. The pan-European index reached 46.3 points, which slightly exceeds the figure for November 2019. However, the current values of business activity in the eurozone are not so high as to help the euro strengthen. In this regard, one should not expect the rise of the "European", experts summarize.

At the beginning of the new year, the American currency turned out to be vulnerable to negative factors despite a slight subsidence of the competitor in the pair. The dollar index fell slightly, demonstrating weak demand for dollars. Therefore, some support for the dollar was provided by a statement by US President Donald Trump on the signing of the first phase of the trade agreement on January 15, 2020. However, in general, traders did not show interest in the "American" currency.

On Friday, January 3, the publication of the minutes of the last Fed meeting is expected. According to experts, this can put additional pressure on the dollar due to the fact that the previous December meeting of the Federal Reserve left a negative impression. Earlier, the regulator announced a significant decrease in consumption growth and a noticeable decline in investment. They still remain weak, the agency stressed. At the same time, the Fed took an indefinitely long pause in the process of easing monetary policy, which greatly disappointed the dollar bulls. The Federal Reserve is also concerned about the weak dynamics of inflationary growth.

Thus, analysts are sure that the current situation may negatively affect the dynamics of the EUR / USD pair. At the moment, experts consider the price ceiling for the pair – 1.1240, which is the level of resistance. The EUR / USD pair does not reach it in any way, demonstrating a clear downward trend. On Thursday, January 2, the pair was trading within 1.1192 – 1.1193, trying to rise higher.

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But unfortunately, attempts to raise the EUR / USD pair were unsuccessful. On the morning of Friday, January 3, the pair held at 1.1170, but then lost ground. The rollback was growing, and the EUR / USD pair went down.

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Currently, the pair runs near 1.1152-1.1153, trying to rise higher from time to time. Sometimes these efforts are not in vain, but in general, the EUR / USD pair rarely succeeds. However, both the euro and the dollar do not stop trying to enter an upward trend.

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Summing up the past year, experts note that the European currency was able to become a full-fledged competitor to the "American" one. Experts explain this by several reasons, including the existence of different economies in the eurozone, both strong and weaker, as well as the presence of negative interest rates, and because of which, investors prefer to invest in the dollar. In 2019, the "European" currency has fallen in price in relation to the dollar by 3%, and in 2020, the single currency may collapse by another 5%, analysts say.

Nevertheless, experts give the euro a chance for further "carte blanche" paired with the "American". According to analysts, the merit of the European currency for its entire existence, which is 21 years, is to undermine the unconditional dominance of the dollar. According to SWIFT calculations, the share of the euro in global trade is 35% and the dollar is 40%. This gap is quite small, experts emphasize. They believe that the European currency took place as a global phenomenon. However, it remains on the sidelines in relation to the American currency.

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Trading plan on EUR/USD for January 3, 2020

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According to media reports, a prominent Iranian General was killed in Baghdad by US forces during an operation. According to unofficial information, this operation was authorized by Trump - the United States strongly opposes Iran's actions in Iraq and Syria. Trump did not voice any messages, but tweeted the US flag after the operation. Meanwhile, Iran's top leader has promised retaliation.

Consequently, markets reacted nervously. Oil increased by 4% to $70 while gold rose to $1,543. Euro, on the contrary, continued to decline. Futures in the S&P500 fell after a new historic high on January 2.

EUR/USD: Despite the second day of decline, euro is still within the correction.

You can buy from 1.1145 and below.

Cancellation of the growth trend is below 1.1100.

Sell from 1.1065.

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Technical analysis: Important intraday levels for USD/JPY, January 03, 2020

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In Asia, Japan today will not release any economic data. However, the US will release a series of economic reports such as Crude Oil Inventories, Natural Gas Storage, Total Vehicle Sales, ISM Manufacturing Prices, Construction Spending m/m, and ISM Manufacturing PMI. So there is a probability the USD/JPY pair will move with low to medium volatility during this day. TODAY'S TECHNICAL LEVELS: Resistance.3: 109.67. Resistance. 2: 108.46. Resistance. 1: 108.25. Support. 1: 107.99. Support. 2: 107.78. Support. 3: 107.57. Disclaimer: Trading Forex on margin carries a high level of risk, and may not be suitable for all traders or investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis recommendations for EUR/USD and GBP/USD on January 3

EUR / USD

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The players took a break for an increase, which was immediately actively used by the opponent after the optimism which we managed to consolidate in the results of the story. Thus far, a downward correction has brought the pair closer to the supports, forming a fairly wide area. The first one on the direction is the daily short-term trend (1.1153), then the levels of different halves are located at 1.1144 - 1.1131 - 1.1111. Now, it is important for promotion players to find support in the designated support area to maintain their capabilities and advantages. The consolidation below will require clarification of the situation, as it may change current plans and priorities.

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In the lower halves, the pair has so far performed a correction to support the weekly long-term trend (1.1164). Today, the following intraday support can be noted at 1.1148 (S1) - 1.1126 (S2) - 1.1087 (S3). At the same time, the nearest resistance, which may affect the current balance of power, is now located at 1.1187 (central pivot-level of the day).

GBP / USD

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The rebound from which the resistance met 1.3250 - 1.3167 - 1.3089 (daily cross + monthly medium-term trend + weekly short-term trend), which are still attracting and restraining the decline, will lead to the continuation of the decline and new testing of the strengthened support zone in the area 1.2920 - 1.2877 (weekly cloud + monthly Fibo Kijun + upper border of the daily cloud).

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On the other hand, a correctional decline in the lower halves led the players to lower to the union of supports for the weekly long-term trend (1.3095) and S1 of the classic Pivot levels (1.3084), as a result, braking is possible in the near future. Overcoming levels will open the way to 1.3032 (S2) - 1.2949 (S3). Now, resistance and benchmark. Consolidation above which will confirm the rebound from the support they met and will allow us to consider further plans to restore the positions of players to increase to the level of 1.3167 (central Pivot-level of the day) today.

Ichimoku Kinko Hyo (9.26.52), Pivot Points (classic), Moving Average (120)

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Technical analysis of ETH/USD for 03/01/2020:

Crypto Industry News:

Mark Hipperson, former head of technology at the Barclays Group, as well as co-founder and former technical director at US Starling Bank, plans to launch his latest digital banking venture, Ziglu, in the first quarter of 2020.

The fully digital account, which is the next step in the bank's concept, will allow you to store multiple currencies, both fiat and digital, in the same account.

A free account will not only be able to keep balances in many currencies, but also freely exchange funds between them. Foreign currencies will be available to buy and sell at interbank rates, and cryptocurrency purchases and sales will be available at the best price among many exchanges.

What's more, according to the Ziglu website, any currency stored on your account can be spent anywhere in the world using a Mastercard debit card. This includes cryptocurrencies that will be immediately converted at the point of sale.

Hipperson has been the CEO of Ziglu since September 2018, and the company has submitted an application to the UK Financial Supervisory Authority (FCA) to become an issuer of electronic money. Pre-release applications are currently being downloaded, but only from UK residents, although there are plans to expand in the future.

Ziglu is certainly not the first company to offer a combined fiat/crypto account. In August of last year, the battle launched an account with an attached Bitcoin wallet and has since also added Ethereum functionality.

Technical Market Overview:

The ETH/USD pair has dropped from the local high at the level of $136.64 to the lower channel line located around the level of $125.00 ( the actual low has been made at the level of $124.48). The bulls have temporary control as they have managed to make a Bullish Engulfing pattern at the lower channel line support and the market is currently trading around the level of $128.00. It is worth to keep an eye on the current developments of the Ethereum market, despite the fact, that the market is still trading aimlessly inside of a range. An important breakout higher or lower can happen anytime now.

Weekly Pivot Points:

WR3 - $156.40

WR2 - $145.89

WR1 - $141.32

Weekly Pivot Point - $130.81

WS1 - $125.47

WS2 - $114.97

WS3 - $109.88

Trading Recommendations:

The best strategy in the current market conditions is to trade with the larger timeframe trend, which is down. All the shorter timeframe moves are still being treated as a counter-trend correction inside of the downtrend. When the wave 2 corrective cycles are completed, the market might will ready for another wave up.

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Technical analysis of BTC/USD for 03/01/2020:

Crypto Industry News:

In most reports summarizing 2019 Bitcoin was not taken into account, and in addition the public still has a rather negative opinion about it. However, despite this, Bitcoin has become the most profitable asset of the past year.

Being more specific, the largest cryptocurrency in 2019 increased its value by over 90%. For comparison, palladium - 57%, followed by crude oil - 35.8% and nickel - 34.1%, according to the data provided by Reuters, at the forefront of traditional assets.

Another objection of Bitcoin opponents is to be its high volatility. Last year, however, showed that this argument is becoming less and less valid. Looking at market data, Bitcoin recorded both positive and negative moves at less than 1% for 150% of this year.

This factor was also responsible for Bitcoin's perception of the media. At one point, he was considered a safe haven for digital gold, but soon became an asset of purely speculative nature.

Last year, we also witnessed the growth of market foundations. At the end of the year, the number of BTC ATM exceeded 6,000 units worldwide, and the number of active addresses in the Bitcoin network increased by 7%.

Technical Market Overview:

The BTC/USD pair has tested the technical support located at the level of $6,798 and bounced suddenly towards the level of $7,157, creating a Bullish Engulfing candlestick pattern. The bull did not throw a towel just yet and the next target for them is seen at the level of $7,389 and $7,482. Nevertheless, the Bitcoin is still trading inside of a narrow range located between the levels of $6,345 - $7,601 and all these inside movements are not as valid and strong as a breakout move. The larger timeframe trend remains down and there are no signals of any trend reversal just yet.

Weekly Pivot Points:

WR3 - $8,243

WR2 - $7,942

WR1 - $7,641

Weekly Pivot Point - $7,288

WS1 - $6,995

WS2 - $6,660

WS3 - $6,345

Trading Recommendations:

The best strategy in the current market conditions is to trade with the larger timeframe trend, which is still down. All the shorter timeframe moves are still being treated as a counter-trend correction inside of the uptrend. When the wave 2 corrective cycles are completed, the market might will ready for another impulsive wave up of a higher degree and uptrend continuation.

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Technical analysis of GBP/USD for 03/01/2020:

Technical Market Overview:

The GBP/USD pair has been capped at the 61% Fibonacci retracement located at the level of 1.3280 and reversed towards the technical support at the level of 1.3121. This level has been violated as well and the price made a new local low at the level of 1.3101 which is inside the old descending channel zone. The next target for bears is seen at the level of 1.3017 or 1.2988 because the market is still coming off the overbought conditions. The momentum is right at its fifty levels, but points to the downside. The larger timeframe trend still remains up.

Weekly Pivot Points:

WR3 - 1.3395

WR2 - 1.3256

WR1 - 1.3182

Weekly Pivot Point - 1.3041

WS1 - 1.2971

WS2 - 1.2819

WS3 - 1.2756

Trading Recommendations:

The best strategy for current market conditions is to trade with the larger timeframe trend, which is up. All downward moves will be treated as local corrections in the uptrend. In order to reverse the trend from up to down, the key level for bulls is seen at 1.2756 and it must be clearly violated. The key long-term technical support is seen at the level of 1.2231 - 1.2224 and the key long-term technical resistance is located at the level of 1.3509.

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Technical analysis of EUR/USD for 03/01/2020:

Technical Market Overview:

After the EUR/USD pair has made a local high at the level of 1.1239, the bears took the control of the market and managed to push the prices below the technical support at the level of 1.1174. The short-term trendline resistance has been tested from below around the level of 1.1210 and violated, but the rally has been terminated, despite the strong and positive momentum. The market is coming off the overbought conditions due to a clear negative divergence between the price of a momentum indicator. After the technical support at the level of 1.1174 has been broken, the next technical resistance is located at the level of 1.1242 and 1.1250. Although the higher timeframes trend remains bearish, the global investors must take into account, that the EUR/USD might be finally breaking up from the multi-month Ending Diagonal pattern.

Weekly Pivot Points:

WR3 - 1.1349

WR2 - 1.1265

WR1 - 1.1228

Weekly Pivot - 1.1151

WS1 - 1.1114

WS2 - 1.1029

WS3 - 1.0994

Trading Recommendations:

The best strategy for current market conditions is to trade with the larger timeframe trend, which is down. All upward moves will be treated as local corrections in the downtrend. The downtrend is valid as long as it is terminated or the level of 1.1445 clearly violated. There is an Ending Diagonal price pattern visible on the larget timeframes that indicate a possible downtrend termination soon. The key short-term levels are technical support at the level of 1.1040 and the technical resistance at the level of 1.1267.

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Indicator analysis: Daily review on GBP / USD on January 3, 2020

Trend analysis (Fig. 1).

On Friday, the price may continue to move down with the target at 1.3095, a pullback level of 50.0% presented in a red dashed line. If this line is reached, the continuation of work down with the target of 1.3050 is a retracement level of 61.8% presented in a red dashed line.

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Fig. 1 (daily chart).

Comprehensive analysis:

- Indicator analysis - down;

- Fibonacci levels - down;

- Volumes - down;

- Candlestick analysis - down;

- Trend analysis - up;

- Bollinger Lines - up;

- Weekly schedule - up.

General conclusion:

On Friday, the price may continue to move down.

The scenario where from a pullback level of 50.0% which is equivalent to 1.3095 presented in a red dashed line, to work up with a target of 1.3169, a pullback level of 50.0% presented in a yellow dashed line is unlikely.

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Indicator analysis: Daily review on EUR / USD on January 3, 2020

Trend analysis (Fig. 1).

On Friday, the price can continue to move down with the first target of 1.1140, the retracement level of 38.2% presented in a red dashed line. If this level is reached, resumption of upward movement with the first goal of 1.1166 is possible, this is the historical resistance level presented in a blue dashed line.

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Fig. 1 (daily chart).

Comprehensive analysis:

- indicator analysis - down;

- Fibonacci levels - down;

- volumes - down;

- candlestick analysis - down;

- trend analysis - up;

- Bollinger Lines - down;

- weekly schedule - up.

General conclusion:

A downtrend is possible on Friday.

An unlikely scenario: from 1.1140 - a retracement level of 38.2% (red dashed line) the price will go down to a retracement level of 50.0% - 1.1110 (red dashed line).

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Elliott wave analysis of GBP/JPY for December 3, 2020

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The break back below short-term key support at 142.41 confirmed that wave b completed already with the test of 144.36 and wave c lower now is unfolding for a decline to to the 137.31 - 137.57 area to complete wave iv or at least the first part of a more complex correction in wave iv.

Short-term resistance is seen at 142.22 and again at 142.78 which is expected to cap the upside for more downside pressure towards the 137.31 - 137.57 target-area.

R3: 143.00

R2: 142.78

R1: 142.22

Pivot: 141.97

S1: 141.61

S2: 141.14

S3: 141.85

Trading recommendation:

Our stop at 142.35 was hit for a nice little profit of 85 pips and we sold GBP at 142.35 too. We will close this short-trade here at 141.75 for another little profit of 60 pips and be ready to sell GBP at 142.50 if seen.

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Elliott wave analysis of EUR/JPY for January 3, 2020

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EUR/JPY has broken back below support at 121.55 indicating that our short-term count was of track and we have reviewed our count from the September low at 115.83. The previous count showing a series of waves ones and twos is no longer the best fit. Instead a leading diagonal seems to be the best count, but this also means that wave 1 completed with the test of 122.66 and a correction of wave 1 now is unfolding as wave 2. The ideal target for this corrective decline is seen at the 50% corrective target at 119.26 which also marks the low of wave iv. So more downside pressure should be expected in the days to come as wave 2 continues lower to 119.26.

Short-term resistance is seen in the 121.18 - 121.36 area, which is expected to cap the upside for more downside pressure towards 120.37 and then 119.26.

R3: 121.69

R2: 121.36

R1: 121.18

Pivot: 120.87

S1: 120.37

S2: 119.88

S3: 119.26

Trading recommendation:

We took profit on our EUR long position from 120.25 at 121.40 booking a nice 115 pips profit even though our count proved incorrect. We will sell EUR at 121.20 with a 122.20 stop and take profit at 119.50.

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GBP/USD: plan for the European session on January 3. Sellers are gradually regaining market equilibrium

To open long positions on GBP/USD you need:

The worsening situation in the manufacturing sector of Great Britain has caused pressure to form on the British pound and its decline in the area of quite important support levels. An attempt by buyers to stop the fall in the region of 1.3147 was not supported by large players, as a result of which, the bulls now need to fight for level 1.3147, which acts as a resistance. Only a return to this range in the first half of the day will lead to the formation of a larger upward correction in the pair to the area of 1.3203. However, a more important task for the bulls will be to break through this range, which will return GBP/USD to the high of this week in the area of 1.3277, where I recommend taking profits. If pressure on the pound remains after the report on the construction sector, it is best to look at long positions on the support test of 1.3085-70, or buy the pound immediately for a rebound from a low of 1.3018.

To open short positions on GBP/USD you need:

As long as the trade is conducted below resistance at 1.3147, pressure on the pound will remain, and sellers will try to do everything to push the pair even lower to a low of 1.3085. A further goal will be to support 1.3018, where I recommend taking profit. However, the minutes of the Federal Reserve, which will be published in the afternoon, will be no less important. Therefore, in the European session, the emphasis will be shifted only to data on the UK construction industry. In the scenario of the bulls returning to themselves the level of 1.3147, it is best to look at short positions on a false breakout from resistance at 1.3203, but selling the pound right away on a rebound is best only from a high of 1.3277.

Signals of indicators:

Moving averages

Trade is conducted below 30 and 50 moving averages, which indicates the preservation of pressure in the short term.

Bollinger bands

In the case the pair declines, support will be provided by the average boundary of the indicator in the area of 1.3085. Growth will be limited to the upper level around 1.3220.

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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 January 3. Inflation in Germany could hurt the euro even more. Bears aim for 1.1145

To open long positions on EURUSD you need:

Yesterday's data on manufacturing activity, which slightly improved in some countries of the eurozone, put pressure on the euro, as production continued to decline in December last year. Today, emphasis will be placed on data on the German labor market and on the report on inflation, which may put pressure on the euro even more. The bull needs to protect the level of 1.1174, which they missed yesterday, since only this scenario will return the pair to the resistance of 1.1200, on which the further upward trend will depend. Consolidating above this level will return EUR/USD to a high of 1.1235 and lead to an update of the resistance of 1.1263. In case the euro further declines after a weak inflation report, it is best to return to long positions on a false breakout from support at 1.1145, or buy immediately for a rebound from a low of 1.1119.

To open short positions on EURUSD you need:

Sellers will be waiting for a weak report on the reduction of inflation in Germany, which will lead to the formation of a false breakout in the resistance area of 1.1174 and will maintain pressure in the EURUSD pair. The first goal of sellers will be to support 1.1145, where I recommend taking profits. In the scenario of its breakout, we can count on a larger bearish momentum already in the area of a low of 1.1119. If sellers are not able to cope with resistance at 1.1174 in the morning, then you can return to short positions after a test of a high of 1.1200, or sell the euro immediately to rebound from resistance at 1.1235. However, such a scenario can only be realized in the event of a sharp increase in the euro after the publication of the minutes of the Federal Reserve.

Signals of indicators:

Moving averages

Trade is conducted below 30 and 50 moving averages, which indicates the preservation of pressure in the short term.

Bollinger bands

If the pair decreases, support will be provided by the lower boundary of the indicator in the region of 1.1155. The upper boundary of the indicator in the region of 1.1210 will act as resistance, a break through which will lead to an increase in the euro.

analytics5e0ec3e740de2.png

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

Forecast for EUR/USD on January 3, 2019

EUR/USD

The euro fell by 57 points on the first trading day of the new year amid a release of macroeconomic statistics. The European Manufacturing PMI in the final assessment for December was raised to 46.3 from 45.9, the US Manufacturing PMI, on the contrary, was revised down from 52.5 to 52.4. This fact confirms the speculative nature of the euro growth in the new year. With the signal level of 1.1150 being overcome below the Fibonacci level of 110.0% on the daily chart, we are waiting for the price to support the embedded line of the price channel in the region of 1.1045. By the time the price goes below the specified signal level, the Marlin oscillator line will exit down its own channel.

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On the four-hour chart, the signal line of the Marlin oscillator has fixed in the zone of negative values - in the decreasing trend zone. With price consolidating under the MACD line, a full-fledged signal for a decline will take place. Note that the MACD line coincides with the signal level of the higher timeframe (1.1150), this increases the significance of the level.

analytics5e0eb21e2e58b.png

Taking into account that current euro quotes are at the peaks of October and November, preliminary price consolidation (about a day) is possible before continuing the decline.

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Forecast for GBP/USD on January 3, 2019

GBP/USD

The British pound grew more than other currencies in the New Year's week, but fell the most with the advent of the new year. Yesterday's decline was 125 points. The immediate goal is the MACD line on the daily chart - 1.3070. And only overcoming the price of this support will unfold the scenario of the pound's further decline.

analytics5e0eb0ff89144.png

On the H4 chart, yesterday's growth was delayed at the Fibonacci level of 38.2%. The immediate goal is to support the MACD line, located at 1.3060, which is close to supporting the Fibonacci level of 23.6% and supporting the daily timeframe 1.3070. The level is strong, respectively, if it is overcome by the price, an accelerated fall in the British currency is possible. The Marlin oscillator shows intention to infiltrate the negative trend zone. Goals 1.2820, 1.2730 - Fibonacci levels of 138.2% and 123.6% on daily.

analytics5e0eb11511f08.png

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Forecast for AUD/USD on January 3, 2019

AUD/USD

The Australian dollar worked out a target range of 0.7023/49, after which it turned sharply down. The signal line of the Marlin Oscillator on the daily chart has formed a sharp peak, which is a sign of a reversal or deep correction of the instrument. The target point is the 0.6928 mark - support for the embedded line of the price channel. Overcoming the first goal opens the way to support the MACD line at about 0.6866, which is also a low on May 17 and 23.

analytics5e0eafd23cfa7.png

On the four-hour chart, the price began to fall immediately after the formation of divergence according to Marlin. The oscillator signal line is already in the negative trend zone, but the price is still above the MACD line (blue indicator), for a more reliable downward signal the price should overcome this line, go below 0.6960.

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Fractal analysis for major currency pairs on January 3

Forecast for January 3:

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: 1.1238, 1.1220, 1.1198, 1.1182, 1.1157, 1.1134, 1.1105 and 1.1085. Here, the price forms the potential for the downward movement of December 31 in the correction of the upward cycle on December 24. The continuation of the movement to the bottom is expected after the breakdown of the level of 1.1157. In this case, the target is 1.1134, wherein price consolidation is near this level. The breakdown of the level of 1.1134 should be accompanied by a pronounced downward movement. Here, the goal is 1.1105. For the potential value for the bottom, we consider the level of 1.1085. Upon reaching which, we expect consolidation, as well as a rollback to the top.

Short-term upward movement is expected in the range 1.1182 - 1.1198. The breakdown of the last value will lead to an in-depth correction. Here, the target is 1.1220. This level is a key support for the top. Its passage at the price will lead to the formation of initial conditions for the upward cycle. Here, the potential target is 1.1238.

The main trend is the upward cycle of December 24, the correction stage

Trading recommendations:

Buy: 1.1182 Take profit: 1.1196

Buy: 1.1199 Take profit: 1.1220

Sell: 1.1157 Take profit: 1.1136

Sell: 1.1132 Take profit: 1.1107

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For the pound / dollar pair, the key levels on the H1 scale are: 1.3417, 1.3338, 1.3282, 1.3199, 1.3097, 1.3061 and 1.3006. Here, we follow the development of the ascending structure of December 23. The continuation of the movement to the top is expected after the breakdown of the level of 1.3200. In this case, the target is 1.3282. Short-term upward movement, as well as consolidation is in the range of 1.3282 - 1.3338. For the potential value for the top, we consider the level of 1.3417. Upon reaching which, we expect a pullback to the bottom.

Short-term downward movement is possibly in the range of 1.3097 - 1.3061. The breakdown of the last value will lead to an in-depth correction. Here, the target is 1.3006. This level is a key support for the top.

The main trend is the upward structure of December 23

Trading recommendations:

Buy: 1.3200 Take profit: 1.3280

Buy: 1.3283 Take profit: 1.3336

Sell: 1.3097 Take profit: 1.3061

Sell: 1.3058 Take profit: 1.3008

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For the dollar / franc pair, the key levels on the H1 scale are: 0.9822, 0.9798, 0.9766, 0.9738, 0.9698, 0.9678 and 0.9644. Here, the price forms the potential for the upward movement of December 31 in the correction of the downward cycle of December 24. The continuation of the movement to the top is expected after the breakdown of the level of 0.9738. In this case, the target is 0.9766, wherein price consolidation is near this level. The breakdown of the level of 0.9766 will lead to a pronounced movement. In this case, the target is 0.9798. For the potential value for the top, we consider the level of 0.9822. Upon reaching which, we expect consolidation, as well as a pullback to the bottom.

Short-term downward movement is possibly in the range of 0.9698 - 0.9678. The breakdown of the latter value will favor the development of a downward structure. In this case, the first target is 0.9644.

The main trend is the downward cycle of December 24, the correction stage

Trading recommendations:

Buy : 0.9738 Take profit: 0.9764

Buy : 0.9767 Take profit: 0.9796

Sell: 0.9698 Take profit: 0.9678

Sell: 0.9676 Take profit: 0.9645

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For the dollar / yen pair, the key levels on the scale are : 109.02, 108.78, 108.61, 108.35, 108.17, 107.94, 107.70 and 107.53. Here, we determine the subsequent goals for the bottom from the local descending structure on January 2. Short-term downward movement is possibly in the range of 108.35 - 108.17. The breakdown of the latter value will lead to movement to the level of 107.94. Price consolidation is near this level. The breakdown 107.94 will allow you to count on a pronounced movement towards a potential target - 107.53. Price consolidation is in the range of 107.53 - 107.70 and from here, we expect a correction.

Short-term upward movement is possibly in the range 108.61 - 108.78. The breakdown of the latter value will have the potential to form the top. Here, the first goal is 109.02.

Main trend: descending structure of December 26, local initial conditions for the bottom of January 2

Trading recommendations:

Buy: 108.61 Take profit: 108.76

Buy : 108.80 Take profit: 109.00

Sell: 108.35 Take profit: 108.18

Sell: 108.15 Take profit: 107.94

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For the Canadian dollar / US dollar pair, the key levels on the H1 scale are: 1.3058, 1.3045, 1.3019, 1.3000, 1.2950 and 1.2924. Here, we are following the development of the local descending structure of December 23. The continuation of movement to the bottom is expected after the breakdown of the level of 1.2950. In this case, the target is 1.2924. We expect a key reversal to the correction from this level.

Short-term upward movement is possibly in the range of 1.3000 - 1.3019. The breakdown of the latter value will lead to an in-depth correction. Here, the target is 1.3045. The range 1.3045 - 1.3058 is a key support for the downward structure. We expect the initial conditions for the upward cycle to be formed before it.

The main trend is the local descending structure of December 23

Trading recommendations:

Buy: 1.3005 Take profit: 1.3017

Buy : 1.3020 Take profit: 1.3045

Sell: 1.2950 Take profit: 1.2926

Sell: Take profit:

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For the Australian dollar / US dollar pair, the key levels on the H1 scale are : 0.7039, 0.7007, 0.6994, 0.6975, 0.6962 and 0.6944. Here, we are following the development of the upward cycle of December 18. At the moment, the price is in the correction zone. Short-term upward movement, as well as consolidation are expected in the range of 0.6994 - 0.7007. For the potential value for the top, we consider the level of 0.7039. Upon reaching this level, we expect a pullback.

Short-term downward movement is expected in the range 0.6975 - 0.6962. The breakdown of the last value will lead to an in-depth correction. Here, the target is 0.6944. This level is a key support for the top.

The main trend is a local upward cycle of December 18, the correction stage

Trading recommendations:

Buy: 0.6995 Take profit: 0.7006

Buy: 0.7010 Take profit: 0.7030

Sell : 0.6975 Take profit : 0.6964

Sell: 0.6960 Take profit: 0.6946

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For the euro / yen pair, the key levels on the H1 scale are: 121.92, 121.62, 121.42, 121.00, 120.86, 120.58 and 120.36. Here, we are following the development of the descending structure of December 27. The continuation of movement to the bottom is expected after the passage of the noise range 121.00 - 120.86. In this case, the target is 120.58. For the potential value for the bottom, we consider the level of 120.36. Upon reaching which, we expect consolidation, as well as a rollback to the top.

Short-term upward movement is possibly in the range of 121.42 - 121.62. The breakdown of the last value will lead to an in-depth correction. Here, the goal is 121.92. This level is a key support for the downward structure.

The main trend is the descending structure of December 27

Trading recommendations:

Buy: 121.42 Take profit: 121.60

Buy: 121.64 Take profit: 121.90

Sell: 120.86 Take profit: 120.60

Sell: 120.56 Take profit: 120.36

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For the pound / yen pair, the key levels on the H1 scale are : 146.07, 145.47, 144.52, 143.74, 142.93, 142.37 and 141.75. Here, we are following the formation of the initial conditions for the top of December 23. The continuation of the movement to the top is expected after the breakdown of the level of 143.75. In this case, the goal is 144.52. Price consolidation is near this level. The breakdown of the level of 144.55 should be accompanied by a pronounced upward movement. Here, the goal is 145.47. For the potential value for the top, we consider the level of 146.07. Upon reaching which, we expect consolidation, as well as a pullback to the bottom.

Short-term downward movement, as well as consolidation are possible in the range of 142.93 - 142.37. The breakdown of the latter value will lead to an in-depth correction. Here, the goal is 141.75. This level is the key support for the ascending structure of December 23.

The main trend is the formation of initial conditions for the top of December 23

Trading recommendations:

Buy: 143.75 Take profit: 144.50

Buy: 144.55 Take profit: 145.45

Sell: 142.35 Take profit: 141.80

Sell: 141.73 Take profit: 141.10

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