EUR/USD Surges Thanks To Weaker Dollar! US Data On Radar

EUR/USD has resumed the upside movement and now is pressuring a strong confluence area formed at the intersection of two resistance levels. We foresee a bullish bias in the short term as the USDX is expected to drop deeper. EUR/USD is trading at 1.0915, above the 1.0908 former high, but we need a confirmation that the pair will resume the bullish movement.

The USDX's drop has enabled the EUR/USD to increase. The index has slipped below 98.91 static support and is expected to drop further if it stabilizes below this level. That's why the odds are in favor of the EUR/USD growth. You should be very careful today because the US data will shake the pair. The US is to release the Prelim GDP, Prelim GDP Price Index, Unemployment Claims, Core Durable Goods Orders, Durable Goods Orders, and the Pending Home Sales. Amid such a loaded economic calendar, EUR/USD should advance further if the data disappoints later today.

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EUR/USD has reached the confluence area formed between the median line (ml) of the descending pitchfork and the R2 (1.0914) level. I've said in my previous analysis that the pair could approach and reach these levels if stabilizes above the Pivot Point (1.0829).

Only a valid breakout above this confluence area will confirm a further increase towards the R3 (1.0966) level, or higher towards the upper median line (uml) of the descending pitchfork. A false breakout and a rejection from this resistance area will send the price down again.

EUR/USD could register a false breakout if the US data comes in better than expected. Some upbeat metrics will boost the USDX, which will signal the USD appreciation versus the major currencies.

  • Trading Recommendation

We may have a great long opportunity if EUR/USD makes a valid breakout through the confluence area formed at the intersection between the median line (ml) and R2 (1.0914) level, the next upside targets are seen at R3 (1.0966), 1.1000 psychological level, and at the upper median line (uml).

A false breakout with a great separation could send the pair back towards the PP (1.0829) level.

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GBP/USD. One step forward, two steps backward: pound cannot determine the direction of its movement

The British currency can not determine the direction of its movement. Yesterday, the pair collapsed to local lows, reaching the level of 1.2893, following the next attack on the 30th figure. However, GBP/USD shows corrective growth again during the Asian session on Thursday. The position is due to a contradictory fundamental background: on the one hand, the pound is under pressure from the Brexit issue (especially in anticipation of negotiations on a trade agreement), on the other hand, the fall of the pair is constrained by the weakness of the dollar, which remains vulnerable. The market also discusses the prospects of monetary policy, although this fundamental factor has so far played a secondary role, since it is still a month (March 26) until the next meeting of the Bank of England. As a result, the pair is forced to trade as part of a wide-range 200-point flat, the lower border of which is the middle of the 28th figure, and the upper border is the middle of the 30th price level.

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Brexit remains the most sensitive topic for the pound. This week, the EU General Affairs Council approved the mandate of the European Commission in negotiations on future relations with Britain. The 46-page document will become the basis for the upcoming negotiations within the transition period (the first consultations between the parties will begin as early as next Monday). The European delegation will be led by Michel Barnier, who "fought with the British" during the first stage of negotiations.

The 46-page document above put significant pressure on the British currency. It reflects Brussels' quite tough position in the upcoming discussions. The common thread is the idea that EU standards should serve as an "unconditional reference point" in any version of a future trade agreement. According to the European Commission, these standards should be applied in the areas of state aid, competition, state, social and labor standards, environmental standards, climate change, relevant tax issues "and other regulatory measures and practices in these areas".

In other words, Europeans initially rejected the so-called "Canadian version" of the deal (as well as the "Australian scenario"). The first option involves almost duty-free trade, with the exception of a number of goods and the market for services. As an alternative, the British propose to consider the "Australian option" - in this case, the parties can choose which sectors of the economy they can agree on, while all other areas will be regulated by the rules of the World Trade Organization.

Moreover, the European Union initially opposed the above options - and now has outlined its position in the form of an approved document. Brussels is trying to "fasten" Britain to EU standards in regulatory matters and trade rules. In addition, Europeans insist that London accept the jurisdiction of the EU Court in possible trade disputes. Great Britain, in turn, is categorically against such proposals. Given these differences, almost all experts and politicians predict a difficult future for the upcoming talks. As French Foreign Minister Jean-Yves Le Drian put it, the parties will "tear each other apart", seeking to gain an advantage in the negotiations. This week, the currency exchange market received another confirmation of such prospects, so the pound paired with the dollar in one day lost more than 100 points.

In addition, many observers are confident that it will be difficult for Britain to conclude a free trade agreement with the EU by the end of 2020. It is worth recalling that the agreement on trade and economic cooperation between the EU and Canada was concluded in 2016 after seven years of negotiations, but similar negotiations between Brussels and Australia on a free trade agreement started back the year before last and have not yet been completed. The upcoming negotiations with London should be completed in 10 months, in December. Given such a short time and all previous statements by politicians, one can imagine how complex and nervous they will be.

The pound paired with the dollar would not be limited to the 28th figure if it were not for the vulnerability of the American currency. The dollar index resumed a downward movement today amid speculation about the prospects for the monetary policy of the Fed. And although Vice President Richard Clarida reassured markets yesterday (he said he was a proponent of a wait-and-see attitude), the general sentiment of the dollar bulls seems depressed. Judging by the dynamics of the spread of coronavirus throughout the world, this issue will be on the agenda for many months to come - therefore, the probability of lowering the interest rate this spring or summer remains high. Due to such risks, the dollar is not able to rally, despite the growth of key macroeconomic indicators.

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Thus, GBP/USD in the medium term will remain within the framework of a wide-range flat: on the one hand, Brexit, on the other hand, the vulnerability of the dollar. The support level is the level of 1.2820. This is the bottom line of the Bollinger Bands indicator on the daily chart, while the resistance level is the price of 1.3030 - the Kijun-sen line at the same time frame.

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Simplified wave analysis of EUR/USD, AUD/USD, and GBP/JPY on February 27

EUR/USD

Analysis:

In the last six months, a downward wave zigzag has been formed on the chart of the European currency. Its last part (C) started in early January. The price has approached the upper limit of the preliminary completion zone. Before the final pull down, a counter rollback is formed.

Forecast:

Today's upcoming trading sessions are expected to see the end of the upward pullback, the formation of a reversal, and a price decline. The beginning of the downward phase can be expected by the end of the day or tomorrow.

Potential reversal zones

Resistance:

- 1.0920/1.0950

Support:

- 1.0850/1.0820

Recommendations:

Trading transactions against the trend direction may be unprofitable and not recommended. In the area of the calculated resistance zone, it is proposed to track euro sell signals.

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AUD/USD

Analysis:

The downward trend continues on the Australian dollar chart. Its last section counts from the beginning of the current year. Last week, the price pushed down the level of intermediate support.

Forecast:

Before continuing the decline, the pair needs to gain a higher wave level, having worked out a pullback up. In the first half of the day, an upward mood is expected today, not above the resistance zone. You can expect a change of course at the end of the day or tomorrow.

Potential reversal zones

Resistance:

- 0.6590/0.6620

Support:

- 0.6520/0.6490

Recommendations:

Purchases on the "Aussie" market today are only possible within the intraday style with a reduced lot. We recommend that you focus on searching for sell signals in the area of calculated resistance.

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GBP/JPY

Analysis:

The last unfinished wave model on the pair's market started in mid-December last year. The middle part (B) is nearing completion. Analysis of the structure of this section shows that the wave is not complete.

Forecast:

In the coming day, you can expect the completion of the downward pullback of the last days, the formation of a reversal and the beginning of a price rise. The upcoming price growth may take a pronounced impulse character. The resistance zone shows the upper limit of the expected volatility.

Potential reversal zones

Resistance:

- 143.30/143.60

Support:

- 142.40/142.10

Recommendations:

Sales of the pair today can be very risky and not recommended. It is suggested to track the instrument purchase signals.

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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 and the dotted background shows the expected movements.

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

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Impact of coronavirus on the currency market will remain high (there is a possibility that the USD will continue to grow

The issue regarding coronavirus remains at the forefront of global financial markets. It continues to dominate, and it seems that investors will not calm down even with its end, since its consequences can be extremely negative for the global economy

The main news of recent days for investors has been an increase in expectations of a slowdown in the US economy. If Fed officials have not yet shown serious concerns about the high probability of a slowdown in the US economy due to the inhibition of the Chinese economy and due to the influence of the coronavirus, then former head of the regulator J. Yellen made it clear on Wednesday that the risks to the American economy remain high and that this misfortune may push the US into recession.

On the other hand, in the wake of the negative that poured into the markets, the US dollar was under noticeable pressure, but not everywhere. After rising in the current last week, it declined against the yen, the Swiss franc and the single European currency. An important role was played here by the growth of expectations that the negative impact of coronavirus on the American economy would force the Federal Reserve to lower interest rates, which, of course, would reduce its attractiveness.

At the same time, the exchange rate of the American currency received support in pairs with the currencies of countries with developing economies from the main ones it rose against the Australian, Canadian and New Zealand dollars. These currencies are commodity and raw materials and strongly correlate with the dynamics of commodity and commodity assets. For example, an "Australian" currency reacts nervously to falling prices for iron ore, the export of which is the most important in the country's economy. Meanwhile, the Canadian dollar is responding to rising or falling oil prices.

The expectation of a slowdown in the global economy amid falling demand for commodity and commodity assets in China is crushing the exchange rates of these currencies. In this case, the American dollar, despite the problems, is growing in relation to them. And such dynamics may continue for some time.

Given recent realities, we believe that, it will continue to remain the main "newsmaker" which will conduct markets until the peak of the influence of coronavirus on investor sentiment passes. Moreover, we believe that by the end of this week, the yen, franc and partly the euro will receive some support in the currency exchange market, which began to increase in the wake of the latest published positive economic statistics on the eurozone. In turn, Canadian, Australian and New Zealand dollars will remain under pressure.

Forecast of the day:

AUD/USD is trading above the level of 0.6500. The persistence of panic in the markets associated with the influence of coronavirus on global economic growth will continue to exert a couple of pressure. This probability is confirmed by the dynamics of the distribution of net positions of futures contracts for the Australian dollar, according to the sentiment of major investors Commitments of Traders (COT). Given these prospects, we believe that the pair can continue to decline to the level of 0.6500 until the end of this week.

USD/CAD is testing a strong resistance level of 1.3345. We believe that negative market sentiment will put pressure on the Canadian currency, which means that if the price breaks the level of 1.3345, it will continue to rise to 1.3415.

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Indicator analysis. Daily review of GBP/USD on February 27, 2020

Trend analysis (Fig. 1).

Today, from the support level of 1.2903 (white bold line), an upward movement is possible with the first target of 1.2944, the retracement level of 38.2% (blue dashed line). If this level is reached, a continuation of work upwards with the target of 1.2958, the pullback level of 50.0% (blue dotted line).

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Fig. 1 (daily chart).

Comprehensive analysis:

- Indicator analysis - up;

- Fibonacci levels - up;

- Volumes - up;

- Candlestick analysis - neutral;

- Trend analysis - up;

- Bollinger lines - down;

- Weekly schedule - up.

General conclusion:

Today, the price may start to move up.

An unlikely scenario is from a pullback level of 38.2% equivalent to 1.2944 (blue dotted line), work down with the target at the support level of 1.2903 (white bold line).

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Technical analysis of ETH/USD for 27/02/2020:

Crypto Industry News:

Billionaire Vladimir Potanin received the permission of the Russian central bank to launch his own Blockchain-based platform and token for use by consumers, financial media reports.

Vladimir Potanin, who has recently become the richest man in Russia according to Forbes ranking, wants to expand his Blockchain platform by launching his own cryptographic token. Digital units will allow customers to buy metals, airline tickets and transfer ski passes from his companies.

Ironically, messages appear shortly after we reported that the FSB has opted for the central bank to potentially ban cryptocurrency as a means of payment.

Potanin has expressed his intention to develop cryptographic tokens several times. He wanted to help customers buy metals using tokens. Now he can implement his plans after obtaining the green light from the Bank of Russia.

The platform's goal is to reduce formalities and brokers, as well as to speed up transaction time.

The Blockchain Potanina platform, called Atomyze, will also be present in Switzerland and the United States, but will only be available to institutional clients.

Atomyze is expected to enter into force by the end of 2020 when the Russian law on digital financial assets will pass through the State Duma and enter into force. Potanin says his tokens would have a great impact on metals. Its nickel and palladium mining giant, Norilsk Nickel, will be the first to try tokens supported by palladium, copper and cobalt. Other platform testing companies include Traxys SA, Trafigura Group and Umicore SA. Nickel, who is the world's largest palladium producer, will be the first to issue Potanin tokens.

Headquartered in Zugu, Switzerland, Atomyze has developed a Blockchain platform based on Hyperledger Fabric and is currently in trial mode.

Technical Market Outlook:

The ETH/USD pair has broken through the key short-term technical support located between the levels of $225.12 - $229.81 as anticipated. The new low was made at the level of $209.85, but the bulls are now trying to bounce a little and test the level of $225.12 from below. The weak and negative momentum supports the bearish outlook. The fear of coronavirus is spreading across the financial markets and the cryptocurrency market is involved as well, together with stocks and risky currencies.

Weekly Pivot Points:

WR3 - $334.89

WR2 - $309.29

WR1 - $291.76

Weekly Pivot -$264.76

WS1 - $245.87

WS2 - $220.22

WS3 - $202.34

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 wave 1 of the overall wave 3.

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Trading plan for EUR/USD on February 27, 2020. The panic around the virus subsided.

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The panic around the coronavirus has subsided. Although the US market closed negatively, the decline was much smaller than that of Monday and Tuesday. Meanwhile, oil fell below $ 50.

News on the virus: the epidemic has obviously passed its peak in China. The total number of cases recorded is 78 thousand. 30 thousand of those has recovered. Meanwhile, for the first time since the beginning of the epidemic, the number of cases outside China exceeded the number of new cases in the country (540 and 440 respectively).

The main and most dangerous foci are South Korea and Italy (374 cases).

Nevertheless, Thursday morning brought no new huge bad news.

Trump reassured that there is no reason for US residents to panic.

Now, let's see if the market can return to normal:

Today at 14:30 London time, GDP on the orders for durable goods in the United States will be released.

EUR/USD: the euro once again slightly updated the highs of the week.

We are still waiting for a new wave of decline.

Sell from 1.0925.

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Indicator analysis. Daily review of EUR/USD on February 27, 2020

During its downward pullback on Wednesday, the pair tested the pullback level of 23.6% equivalent to 1.0865 (blue dashed line) and then continued to move upward, testing the 21 average EMA at 1.0909 (black thin line). Today, strong calendar news for the dollar is expected at 13:30 and 15:00 UTC. The price may continue to move up.

Trend analysis (Fig. 1).

The market may continue to move up today with the target of 1.0956, the pullback level of 38.2% (red dashed line). Upon reaching this level, continuation of work up to the support line of 1.0971 (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:

A continued upward movement is expected today with the target of 1.0956, the pullback level of 38.2% (red dashed line).

An unlikely scenario is from the 21 average EMA of 1.0909 (black thin line), work down with the target 1.0883, the retracement level of 23.6% (blue dashed line). Upon reaching this level, the next lower target is 1.0863, the retracement level of 38.2% (blue dashed line).

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Technical analysis of BTC/USD for 27/02/2020:

Crypto Industry News:

The fourth richest person in the world discussed his experience with Bitcoin after raising money. Justin Sun, CEO of the Throne and longtime cryptocurrency supporter was present.

In May 2019, they both met others at a fundraiser for the Glide Foundation, a charity that helps homeless people in San Francisco. Speaking like a billionaire to billionaire, young Sun suggested to seasoned Warren to consider investing in cryptocurrencies.

However, when asked if Sun gave him Bitcoins after the exchange, Buffett replied:

"I don't have any cryptocurrency. I will never do it ... You can't do it except to sell it to someone else. Cryptocurrencies basically have no value."

He also commented on the fact that cryptocurrency is related to money laundering and terrorism:

: Bitcoin was used to illegally transfer a large amount of money, "he said.

Buffett made the most of his assets on hedge funds and insurance. His assets are estimated at USD 88.9 billion.

Bitcoin has seen large investments from both millionaires and billionaires, but as Warren showed, some who have made a fortune using more traditional means are reluctant to accept cryptocurrencies. Mark Cuban, a billionaire who gained fame in the dot-com bubble, said he would rather have "bananas" rather than Bitcoin.

On the other hand, several success stories have appeared. Tyler and Cameron Winklevoss may not have grabbed the benefits of Facebook, but after the Gemini cryptographic exchange was founded, they both have total assets of over $ 1.4 billion.

Technical Market Outlook:

The BTC/USD pair has made another lower low at the level of $8,495. Currently, the BTC/USD is trading below the support located at the level of $9,123 and the momentum remains weak and negative, so odds for another wave down are high. The next target for bears is seen at the level of $8,405. The corrective cycle is getting deeper as the coronavirus fears affect all financial markets.

Weekly Pivot Points:

WR3 - $11,253

WR2 - $10,744

WR1 - $10,274

Weekly Pivot - $9,742

WS1 - $9,288

WS2 - $8,756

WS3 - $8,263

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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The Bitcoin is on the way to $8,435.37

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At the 4-hour Chart, Bitcoin is trading under selling pressure. Now this cryptocurrency seems to be willing to attack the $8,435.37 level as long the price does not rebound to the level higher than $9,247.15. The $8,435.37 level is still imminent to be reached. The overall bias for bitcoin is bearish.

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.

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Technical analysis of GBP/USD for 27/02/2020:

Technical Market Outlook:

After a new local high was made at the level of 1.3016, the bears had took control of the market again and push the price way lower towards the middle of the GBP/USD trading range again. The market backed off from the overbought conditions and the momentum indicator is showing negative - to - neutral momentum at the H4 timeframe chart. The market trades aimlessly for now until one of the key levels is finally clearly violated. The next technical support is seen at the level of 1.2904 and 1.2871.

Weekly Pivot Points:

WR3 - 1.3255

WR2 - 1.3152

WR1 - 1.3043

Weekly Pivot - 1.2942

WS1 - 1.2840

WS2 - 1.2740

WS3 - 1.2640

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 27/02/2020:

Technical Market Outlook:

The EUR/USD pair has broken through the nearest short-term technical resistance zone located between the levels of 1.0879 - 1.0904 and made a new local high at the level of 1.0914. The next target for bulls is seen at the level of 1.0940 and 1.0981, but the market conditions are now overbought despite the strong and positive momentum. The larger timeframe trend is still down.

Weekly Pivot Points:

WR3 - 1.0954

WR2 - 1.0908

WR1 - 1.0871

Weekly Pivot - 1.0825

WS1 - 1.0787

WS2 - 1.0735

WS3 - 1.0693

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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Overview of the GBP/USD pair. February 27. The British pound continues to "swing". Markets are confused

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) - sideways.

CCI: -57.8991

The GBP/USD currency pair resumed its downward movement despite the complete absence of macroeconomic statistics in the United Kingdom and the United States. Nevertheless, the pair continues to show quite high volatility, as well as pronounced "swings". There is no trend movement as such since market participants are openly waiting for information about trade negotiations between London and Brussels or at least some important statistics. Since none of this is currently available, traders trade in different directions.

As we said in the next article on EUR/USD, all traders' attention will be focused on American statistics today. No significant report is expected from the UK this week, and the pound itself continues to throw and toss from side to side amid complete uncertainty about the prospects of signing trade agreements with the States and the European Union. However, let's return to the general outlook for the British currency and the outlook for today, Thursday, February 27. The general outlook has been clear for a long time. There is no reason for the British currency to grow and strengthen. This does not mean that the pound is 100% likely to start falling today. You should always consider the "market factor". In the currency market, there are not only speculators who aim to get the exchange rate difference and profit. Accordingly, those who carefully monitor all news and messages on important topics for a particular currency. There are also large companies that buy a particular currency in large volumes to conduct their activities and their transactions also affect the exchange rate. However, these companies are not guided by a fundamental or macroeconomic background when making transactions in the foreign exchange market. They need the currency to conduct import-export transactions or hedge risks. Thus, in theory, the pound from the current positions can start to get more expensive, even if the fundamental background is against it.

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However, let's return to the shorter-term prospects. The most interesting and at the same time predictable indicator is the US GDP for the fourth quarter. However, this is only a preliminary value, so even if the actual value differs from the forecast value, it is not a fact that traders will decide to work out this report. According to economists' forecasts, the increase will be 2.1% in the fourth quarter, which coincides with the value of the third quarter.

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More important, from our point of view, is the indicator of orders for durable goods, in all four of its variations. The overall indicator, according to the chart, jumps up and down every month or two, showing an increase or fall. Today, the forecast is -1.5% m/m, which is negative for the dollar, but it fits into the usual behavior of the indicator.

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Another significant indicator is "excluding transport orders", which more often shows the positive trend and an increase of 0.2% m/m is planned in January. In addition to the two indicators already described, orders will be published "excluding defense and aviation" with a forecast of +0.1% m/m and "excluding defense" with a forecast of +1.3% m/m. Thus, it is expected that the main indicator of orders will be reduced from one and a half percent, and all others will show minimal growth. However, we are almost certain that the actual figures will differ greatly from the forecast values, and in different directions. Accordingly, it will be necessary to draw conclusions on these indicators after their publication. Data on the GDP price index and applications for unemployment benefits are also planned for today. However, these reports are secondary.

Thus, it is even difficult to say what to expect from macroeconomic statistics from the United States. The pound has resumed falling but has been moving in recent days with absolutely no fundamental support. How will traders react to any kind of statistics from overseas is difficult to say. From a technical point of view, the downward trend again prevails in the market, but at the same time, the pound/dollar pair continues to have a frank "swing". Therefore, the best advice for traders in the current situation is to be more cautious. The pound is not the most attractive tool for trading right now.

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The average volatility of the pound/dollar pair over the past 5 days is 93 points and is still characterized as "average" in strength. According to the current volatility level, the working channel on February 27 will be limited to the levels of 1.2814 and 1.3000. A reversal of the Heiken Ashi indicator to the top will indicate a possible resumption of the upward movement, within the "swing".

Nearest support levels:

S1 - 1.2909

S2 - 1.2878

S3 - 1.2848

Nearest resistance levels:

R1 - 1.2939

R2 - 1.2970

R3 - 1.3000

Trading recommendations:

The GBP/USD pair resumed its downward movement. Thus, it is now recommended to sell the pound with targets of 1.2878 and 1.2848, before the Heiken Ashi indicator turns up. It will be possible to buy the British currency with the targets of 1.3000 and 1.3031, but in small lots, if traders again fix the pair above the moving average line.

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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Overview of the EUR/USD pair. February 27. American statistics may return the market's interest in the US dollar

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) - sideways.

CCI: 113.1585

On February 27, the European currency paired with the US dollar starts with the same weak upward correction movement. The price is still above the moving average, so the upward movement retains its prospects. On Wednesday, nothing out of the ordinary happened for the EUR/USD pair. Therefore, the pair was moving extremely prosaic. Although the fundamental background is empty, the volatility of the euro is quite high. However, the absence of any interesting events in the economic world contributes to the withdrawal of traders from the market. So far, we can say that everything is going according to the corrective plan.

After three empty days in terms of macroeconomic statistics, traders will finally have something to pay attention to. I would like to note that the entire block of statistics today can be divided into two groups: (1) European reports, which are statistical and are unlikely to cause any market reaction; (2) American reports, which are important and are likely to cause a market reaction. Among the seven publications in the EU today, we can distinguish two of the most significant.

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First - the business climate indicator for February, which is based on surveys and evaluates the current conditions for doing business in the European Union. As you can see, based on the graph, this indicator has been falling for the past two years, which coincides with a drop in industrial production and a slowdown in GDP. Forecasts for February are not comforting. It is expected to further reduce the indicator from the current -0.23 to -0.28.

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Second - the level of consumer confidence, which reflects the mood among consumers and their confidence in the current economic situation. Here the graph is even more eloquent. Over the past two years, the indicator has been firmly stuck in the negative zone and there is no reason to assume its rapid exit from it. The forecast for February is -6.6. Thus, we see that even if these indices were important for traders, they would still not support the European currency.

Thus, market participants will have to pay all their attention today to the data that will come from overseas. In the United States, orders for durable goods and its three variations will be published today: excluding defense and transportation orders. Also, the fourth-quarter GDP in the United States will be published according to preliminary estimates, the price index of GDP, as well as the number of new applications for unemployment benefits. The most important data will be discussed with charts in the article on GBP/USD. Here we can say that the forecasts for all indicators are versatile. First of all, it is very difficult to predict what will be the actual values of the reports. And secondly, what will be the reaction of traders if, for example, two of the four reports on orders are higher than forecasts, and two are lower. Given the fact that the euro continues to balance on the verge of not resuming the downward trend, it needs weak statistics from overseas.

From a technical point of view, the euro/dollar pair continues to trade just above the moving average, and since there will be very few important macroeconomic statistics this week, nothing should lead the pair off the corrective path. However, once again we warn traders that the bulls remain extremely weak and do not have any fundamental support. However, after such a strong fall in the euro in recent weeks, a correction is still vital. And it is unlikely that it will be "fast". Most likely, it will take several weeks. However, you should also be prepared for the resumption of the downward trend. We have repeatedly said that all the trumps remain in the hands of the US dollar and it will strive for price parity with the euro in 2020.

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The average volatility of the euro/dollar currency pair is currently 61 points per day. The volatility indicator continues to grow. However, given the weak macroeconomic background this week, this process may stop very soon. Thus, on Wednesday, we expect movement between the borders of the volatility corridor of 1.0826-1.0948. A reversal of the Heiken Ashi indicator to the top will indicate a new round of upward movement.

Nearest support levels:

S1 - 1.0864

S2 - 1.0803

S3 - 1.0742

Nearest resistance levels:

R1 - 1.0925

R2 - 1.0986

R3 - 1.1047

Trading recommendations:

The euro/dollar pair continues its corrective movement, formally - an upward trend. Thus, purchases of the European currency with the targets of 1.0925 and 1.0948 are relevant now since both channels of linear regression are directed downwards. You can return to sell positions after the price is fixed below the moving average line with the first targets of 1.0803 and 1.0742.

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.

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

GBP/AUD to test liquidity pool at 2.0015

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According to the weekly chart, GBP/AUD is forming a market maker buy model. It is seen that the level of the 2.0015 is a weekly bearish order block. This level is liquidity pool. As long as the pair does not resume its downward movement to 1.9159, this liquidity pool level at 2.0015 should be tested. The overall bias for GBP/AUD is bullish.

(Disclaimer)

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

GBP/USD: plan for the European session on February 27. Upward trend is broken. Pound risks returning to month lows at 1.2850

To open long positions on GBP/USD you need:

The British pound continues to play on the nerves of investors and, as I noted in yesterday's review, behaves exactly the same as during the uncertainty with Brexit. The importance of trade negotiations between the EU and the UK is causing a surge in market volatility. At the moment, the task of the bulls is to break and consolidate above the resistance of 1.2930, which will lead to a larger growth of GBP/USD in the region of the high of 1.2970, but for this it is necessary to cope with the moving averages. With larger growth, the bulls will try to return the pair to a high of 1.3006. In case the pound falls further, which might occur after the speech of the head of the Bank of England Mark Carney, it is best to open long positions only after a false breakout has formed in the support area of 1.2889, and I recommend buying the pound for a rebound only from the low of this month at 1.2851, and then with the condition for a rebound no more than 25-30 points.

To open short positions on GBP/USD you need:

Pound sellers control the market, so they will wait for more suitable prices. The formation of a false breakout at the level of 1.2930, with a rebound from the moving average will be a signal to open short positions in the pound, which will lead to its decline and update support at 1.2889. In the absence of active sales after forming this setup, it is better to open short positions in GBP/USD only by a rebound from a high of 1.2970. A more important task for the bears is to break through and consolidate below the support of 1.2889, which will quickly push the pair to the year lows at 1.2851, and will lead to their renewal in the areas of 1.2830 and 1.2799, where I recommend taking profits. However, the reaction to the statements of the Governor of the Bank of England can be unpredictable, since any statements related to interest rates will lead to a surge in market volatility and can dramatically change investor sentiment.

Signals of indicators:

Moving averages

Trading is carried out below 30 and 50 moving average, which saves the likelihood of continued downward correction. The averages also play the role of resistance.

Bollinger bands

In case the pair falls, support will be provided by the lower boundary of the indicator in the region of 1.2889. A break of the upper boundary of the indicator in the area of 1.2945 will lead to a new wave of pound growth.

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

EUR/USD: plan for the European session on February 27. Attention to euro purchases. Important resistance 1.0925 may limit

To open long positions on EURUSD you need:

Yesterday's confrontation for the level of 1.0895 was on the side of the bulls, however, the upward correction for the euro is gradually slowing, as buyers are approaching an important level of 1.0925, which may limit the further growth of the pair. A lot of fundamental statistics are planned for today, both in the eurozone and in the US, which can lead to profit taking by buyers, who will count on maintaining support at 1.0895, where the formation of a false breakout will signal a purchase. However, the resistance of 1.0925 remains a more important goal, a breakthrough of which will open a direct path to a high of 1.0950, from where large sellers will begin to operate. If the bulls are not able to maintain 1.0895 support in the morning after poor credit reports and consumer confidence in the eurozone, then it is best to look at long positions on the test of yesterday's low in the region of 1.0865-60, where the lower boundary of the rising price channel also passes, or buy for a rebound from the area of 1.0835.

To open short positions on EURUSD you need:

The sellers' task for the first half of the day will be to return the pair to the support level of 1.0895, since it will be possible to expect a downward correction to the area of moving averages only in this scenario, as well as to the lower boundary of the upward channel, which is located slightly above the support of 1.0865. Consolidating below this range will quickly push the euro down to a low of 1.0835, where I recommend taking profits. However, one can count on such a bearish move only on condition of very weak data on the state of the eurozone economy and a sharp decrease in the consumer confidence indicator. In the scenario of EUR/USD growth in the morning, which may occur after the speech of the European Central Bank President Christine Lagarde, the resistance will be the area of 1.0925, from which I recommend opening short positions only if a false breakout is formed. Selling the euro immediately for a rebound is best done from a larger high of 1.0950.

Signals of indicators:

Moving averages

Trading is conducted above 30 and 50 moving averages, which indicates the likelihood of further upward correction of the euro. With a decrease in the pair, the moving averages will also act as support.

Bollinger bands

As long as trading is above the middle of the indicator, demand for the euro will continue. If the pair decreases, you can buy for a rebound from the lower boundary of the indicator in the area of 1.0860.

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

Forecast for EUR/USD on February 27, 2020

EUR/USD

The euro once again tried to compete with the resistance of the Fibonacci level of 138.2% (1.0898) on Wednesday, the trading volume was high, it is very likely that investors again accumulated short positions. The signal line of the Marlin oscillator reached the boundary of the growth territory. The degree of probability of a reversal from this boundary will be considered on a smaller scale chart.

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At H4, the oscillator signal line exited down from the wedge and returned to it. In general, this is still a signal for a price reversal. Confirmation of a reversal will be when the price leaves yesterday's low of 1.0855. The immediate goal of the euro 1.0813 is to support the MACD line. Next, we expect the euro at a quote of 1.0745 - at the Fibonacci level of 200.0% (daily).

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But the euro is still growing. The growth limit may be the Fibonacci level of 123.6% at the price of 1.0933.

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

Forecast for GBP/USD on February 27, 2020

GBP/USD

The British pound lost a little over a hundred points on Wednesday, taking the technical conditions for a further decline. The Marlin oscillator on the daily chart is back in the declining trend zone. The immediate target of 1.2842 at the Fibonacci level of 110.0% is open. Below it is the second target at the level of 123.6% at the price of 1.2758.

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On a four-hour chart, the price consolidated under the MACD line (blue moving line), Marlin in the zone of negative values. The price continues to fall.

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

Forecast for USD/JPY on February 27, 2020

USD/JPY

The Japanese yen has been trying for two days to recover from a fall since February 21, but it seems to have no strength. The price is still held by two supports at once - the MACD indicator line and the green price channel trend line, but the Marlin oscillator is in a hurry to penetrate into negative territory, which, when the price goes down to technical levels, will increase the fall of the USD/JPY pair.

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The purpose of the movement is the area of intersection of the trend lines of two price channels - green rising and red falling, this is the area 108.00.

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On a four-hour chart, the price is consolidating under the indicator lines of balance and MACD, the lines themselves are turning down. Marlin is in the decline zone. We are waiting for the price at the designated target of 108.00.

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

EUR/USD. Dollar took a breather: further correction depends on US data

The euro-dollar today has slowed its correction. After a three-day consecutive growth, buyers felt a certain discomfort - during the European session on Wednesday, the pair actually stagnated, showing rare and multidirectional price "delays". This price dynamics is due primarily to the behavior of the US currency. The dollar index suspended its decline, returning to the area of 99 points. But the European currency is not able to independently "pull out" the correction, even with the general phlegmatism of dollar bulls. Coronavirus continues to "walk" around Europe, provoking panic in the markets and putting natural pressure on the euro. The changed fundamental background did not allow EUR/USD buyers to enter the ninth figure and gain a foothold above the resistance level of 1.0920. This fact should alert supporters of long positions - purchases are now quite risky. Today's behavior of the pair suggests that the current corrective growth has almost exhausted itself - but for the next price wave, an appropriate informational occasion is needed.

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Let me remind you that the weakening of the US currency was primarily associated with the prospects for the monetary policy of the Fed. Rumors have intensified in the market that the Federal Reserve will lower rates in the foreseeable future - some spoke about the April meeting, others relied on June. Some currency strategists do not exclude a double rate cut (in summer and autumn). Oil was added to the fire and the comments of some representatives of the Fed, who spoke in favor of lowering rates. This is not only about successive doves (for example, Kashkari), but also other members of the Committee, such as Judy Shelton and Christopher Waller (protege of Donald Trump). Representatives of the hawkish wing also talk about the risks of the coronavirus epidemic, but at the same time they urge not to rush into action. In their opinion, now we should take a wait-and-see attitude in order to objectively assess the current situation.

In other words, today there is no definitive confidence in the market that the Fed will announce a rate cut on March 18. The Fed vice president Richard Clarida also sowed certain doubts. Yesterday, he said that the central bank is monitoring the impact of the epidemic on the US economy, but at the same time, "it is too early to say that the epidemic will require changes in monetary policy."

Therefore, the dollar slowed down as well - the probability of a rate cut has decreased, while the key macroeconomic indicators in the US have recently shown good dynamics. In turn, the euro has no arguments for its own growth, especially against the backdrop of increasing panic. To date, coronavirus has been recorded in 15 European countries. Italy has suffered the most - the number of infected has exceeded 300 people, 12 of them have died. Next, in descending order - Germany, France, Britain, Spain, Austria, Croatia and the lowest quantity - in some other countries. The Italian precedent frankly scares investors, including in the context of economic prospects.

Judge for yourself: the measures taken by the Italian government have affected nearly 30 million people. Schools and universities were closed in the north of the country (not only in those regions where an outbreak was recorded). Many factories, bars, restaurants are closed. Government departments operate on a limited basis. According to preliminary data, if a similar situation persists in the coming months, Italy's GDP may decline by 0.5-1%. This will lead to a recession in Italy and an increase in its external debt. If you project the Italian precedent over the entire eurozone, the consequences will look disastrous. And judging by the dynamics of the spread of coronavirus in Europe, this scenario is quite likely.

That is why the further corrective growth of the EUR/USD pair depends only on the "well-being" of the dollar - a single currency will only move in the wake of the greenback.

In turn, the dollar will respond to the dynamics of macroeconomic statistics. For example, tomorrow, February 27, we will find out the second estimate of US GDP growth for the fourth quarter of last year. According to forecasts, this indicator will be revised upward from 2.1% to 2.2%. Although this review will be minimal, the very fact of such dynamics will improve the position of the greenback. The price index should remain at the same level, reflecting a slowdown - if in the second quarter of 2019 it reached 2.4%, then in the fourth quarter it fell to 1.4%. Data on the volume of orders for durable goods in the United States will be released on Thursday. The indicator showed positive dynamics in December, having got out of the negative area (similarly, excluding transport). Experts predict contradictory dynamics in January - the overall indicator should slow down to -1.4% (from the previous value of 2.4%), and without taking into account transport, it should grow to a low of 0.2%.

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If both indicators collapse into the negative area, the dollar may be under pressure. In this case, the EUR/USD bulls will be able to test the nearest resistance level of 1.0920 (the middle line of the Bollinger Bands indicator is on D1). If the statistics are on the dollar side, the pair will again return to the bottom of the eighth figure.

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

GBP/USD. Results of February 26. European Commission President Ursula von der Leyen: EU ready to start negotiations with

4-hour timeframe

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Amplitude of the last 5 days (high-low): 115p - 80p - 105p - 68p - 104p.

Average volatility over the past 5 days: 95p (average).

The GBP/USD currency pair continues to trade in different directions. After the pound/dollar pair rose to the upper boundary of the Ichimoku cloud on Tuesday, a downward reversal and a rather strong fall of the British currency followed today. At the moment, the pair is trading even below the Kijun-sen critical line, overcoming which will change the current trend from upward to downward. However, on the whole, the swing continues without a pronounced tendency. If earlier the pound often refused to react to the fundamental and macroeconomic background, so that we even started thinking about the paradoxical situation for the pound, now there is simply no macroeconomic background. No important messages were received from the UK, no economic reports were published in the first three trading days of the week. It's impossible to even say that the pound is currently traded on pure technology, since the "swing" cannot be technically justified only if it is not a pronounced flat. However, there is no flat now. Therefore, we now have a simply completely unpredictable, non-trending, non-phletic movement, which has no fundamental justification. In this situation, each trader decides whether to trade this pair or not.

In the meantime, from time to time, traders are informed about future trade negotiations between London and Brussels. So far, they have no significance, since the negotiations themselves have not yet begun. For example, today the head of the European Commission, Ursula von der Leyen, announced her readiness to begin negotiations with London. Judge for yourself, dear traders, how important this message is. "Negotiations with Great Britain will begin on March 2. We are ready to build a close relationship with an ambitious partnership with the UK. It's good for people and business," von der Leyen wrote on her Twitter. Information that negotiations will begin in early March has been known for a long time. Moreover, the European Council just the other day adopted a mandate, according to which negotiations will be held with London, Michel Barnier and his group of diplomats. In general, this news is not news at all.

We continue to insist that the British currency ignores the general negative fundamental background. We believe that the pound should form a new downward trend a long time ago, since there are very few prospects for concluding an EU-Britain trade deal. Especially with such a prime minister as Boris Johnson, who decided to negotiate with everyone in the style of Donald Trump, that is, from the standpoint of his own benefit and strength. That's just Britain - not the United States. America has the strongest economy in the world, and the British economy has stalled very much in recent years. Boris Johnson, with his integrity and inability to negotiate, can only finish off the British economy.

From a technical point of view, there is now a correction against the Golden Cross. Thus, a rebound in the price from the Kijun-sen line may trigger a new round of upward movement.

Trading recommendations:

GBP/USD has started a new round of correction against a correction or an upward trend. Thus, selling the British pound with the target of 1.2850 is now recommended no earlier than the return of quotes below the critical line. We recommend that you consider buying the pair with a target of 1.3055 in small lots if the bulls stay above the Kijun-sen line. The fundamental background still does not support the pound.

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

EUR/USD. Results of February 26. China and Iran suspected of concealing the true extent of the spread of coronavirus

4-hour timeframe

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Amplitude of the last 5 days (high-low): 52p - 26p - 43p - 80p - 67p - 60p.

Average volatility over the past 5 days: 56p (average).

The EUR/USD currency pair continued a not too strong upward correctional movement in the third trading day of the week against the downward trend of the last three weeks. The pair made another attempt to overcome the Ichimoku cloud on February 26, which again ended in failure. Formally, consolidation above the cloud took place, but very soon quotes of the euro/dollar pair returned to the Ichimoku cloud. Thus, the US currency has risen in price today, despite the fact that the pair continues to trade around three-year lows. Despite the fact that stock markets and indices in the United States collapsed this week. Despite the fact that the coronavirus continues to spread across the planet and its consequences can be very serious for the global economy, which has just recovered from trade wars. However, as we have repeatedly said, the COVID-2019 virus affects not only the US economy. It also has a negative impact on the European economy. Thus, nothing in the balance of power between the economies of the European Union and the United States does not change. Accordingly, in recent years there have been no new reasons for the appreciation of the euro or the fall of the US dollar. Not a single important macroeconomic report was published either in the European Union or in the United States on Wednesday. Thus, the fundamental and macroeconomic background was again completely empty. At the same time, the volatility of the pair remains at a fairly high level, about 60 points per day.

Since traders simply do not receive any important messages of an economic nature, one has to pay attention to secondary (for the currency market) news and messages. In the United States, for example, Secretary of State Mike Pompeo made a statement accusing China and Iran of hiding reliable information about the extent of the spread of the pneumonia virus. Beijing previously expelled three Wall Street reporters from China, which sparked a storm of criticism in America. The official reasons for the removal of journalists from China are unknown, but the American side believes that independent reporters are necessary in order for the world to receive reliable information about the infection problem. "The exile of our journalists draws attention to the problem of the PRC government, which previously led to an outbreak of SARS, and now to an outbreak of coronavirus, namely censorship. This can be fatal," said Pompeo. Similar allegations have been directed against Iran. According to Pompeo, in Iran the number of infections and deaths from the virus can be much higher than the government reports. Pompeo also said that the United States was deeply saddened by the fact that the Iranian government had concealed "important information about the infection." "All countries, including Iran, must tell the truth about the coronavirus and collaborate with international healthcare organizations," Pompeo summed up.

However, the coronavirus and its distribution do not yet directly affect the foreign exchange market. Yes, perhaps, amid the collapse of US stock markets, some investors are transferring their funds to safer assets, such as gold or franc, or the yen. However, the Chinese infection has not yet been reflected in the euro/dollar pair. Thus, the corrective movement is still ongoing, and it is very difficult to work out, as there is no news from the US and the EU, and the upward movement is extremely uncertain.

Trading recommendations:

The EUR/USD pair continues to be a corrective movement. Thus, now we can formally consider long positions with targets of 1.0915 and 1.0936 after the MACD indicator turns up, which will indicate the completion of a correction round, but only with small lots or not at all. It will be possible to return to selling the pair with targets at support levels of 1.0824 and 1.0795, if traders manage to gain a foothold back below the critical line.

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