Technical Analysis of EUR/USD for 21/04/2020:

Technical Market Outlook:

The EUR/USD pair has made a new local low at the level of 1.0812 before the local consolidation took place. The bulls tried to bounce towards the level of 1.0893, which is a short-term technical resistance for the price, but failed to extend the rally. This indcates a possible increase in the bearish activity soon, so it is worth to keep an eye on the local support at 1.0812. Any violation of this level will lead to the test of the key short-term support located at the level of 1.0778.

Weekly Pivot Points:

WR3 - 1.1134

WR2 - 1.1063

WR1 - 1.0956

Weekly Pivot - 1.0883

WS1 - 1.0784

WS2 - 1.0701

WS3 - 1.0600

Trading Recommendations:

The fear of the coronavirus consequences is very strong among the global investors and it rules on the financial markets. ON the EUR/USD pair the main trend is down, but the reversal is possible when the coronavirus pandemic will be tamed. The key long-term technical support is seen at the level of 1.0336 and the key long-term technical resistance is seen at the level of 1.1540. Only if one of this levels is clearly violated, the main trend might reverse (1.1540) or accelerate (1.0336).

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WTI oil provoked a temporary increase in panic, but it will not last long; Overview of EUR and GBP

Asian stock indices are losing from 1 to 2% on Tuesday morning trading, following the US indices, which declined noticeably after a sharp drop in oil prices on Monday evening. There is no doubt that European sites will open with a strong decline, and this will not be prevented even by encouraging news on slowing the rate of spread of the coronavirus in most countries.

The main reason for the oil drop is the consumption of oil storage capacities amid a record decline in demand. Since WTI futures are deliverable, those who own the contract should have a place to store oil, so they have a dilemma – either to prolong the contract until June or close it. However, Brent has a different situation - the May contracts have already been repaid, so the decrease is much less. The fact that the current situation in the oil market is unlikely to lead to a collapse in commodity indices is also evidenced by the fact that the LMEX industrial metals index at trading in London has not changed, that is, the WTI light oil storm is local in nature.

As expected, the market reacted negatively. There was an increase in demand for gold and bonds, but both the yen and the franc were virtually without movement, that is, the panic is local in nature and will not last long. The Chicago Federal Reserve Index in March declined to -4.19p, while the real sector of the economy continues to fall.

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Positive news on the coronavirus will be published today, so growth in demand for risky assets can be expected. It will take some more time for a low base to form, starting from which markets will resume growth.

EUR/USD

The estimated fair price is still kept above the spot price. This is understandable - the CFTC report showed that the net long position on the euro increased again last week, reaching $ 10.841 billion. In the medium and especially long-term assessment of the prospects for the euro, we must proceed from the fact that speculators see a strong potential for the growth of the euro, especially that the ECB repurchase program is significantly inferior in volume to the Fed. At the same time, the situation in the short-term does not look in favor of the euro, since the direction of the estimated price is directed downwards, that is, there is a tendency to decrease it, which strengthens the grounds for lowering EUR/USD.

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The approach of the US election is a factor that is directed against the strengthening of the euro. And since the US markets must attract foreign investors, the Trump government will take steps to support the stock market, and therefore to attract capital, which will support the dollar.

GBP/USD

According to the CFTC report, the long position on the pound declined by 0.103 billion. It's not a big reduction, but the trend is negative. Accordingly, the settlement price also goes down, which reduces the chances of the pound resuming growth.

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The positions of the pound look vulnerable. In the UK, there is no strategy to open the economy after the pandemic, while the rate of spread of coronavirus has increased significantly. Uncertainty also remains with regard to Brexit, as trade negotiations with the EU are still far from resolving as in January.

The Bank of England rate is at the lowest effective level of 0.1%. Further decline is unlikely and BoE's efforts are aimed at launching direct financing mechanisms for corporations. Moreover, the pound receives additional vulnerability because the UK has a large current account deficit.

Today, a report on the labor market will be published, but it will not have a strong impact because it will include data only for February, but for one position - applications for unemployment benefits - March data will be published. An inflation report for March will be published on Wednesday, surprises are possible, as consumer demand fell recordly in March, pressure on the pound may increase on Wednesday.

The GBP/USD pair managed to recover after the period of panic sales in the second half of March ended, but the risks are rising again, and the pound is under pressure. The pound went below the support 1.2440/60, which is now a resistance. As a result, the most likely scenario for the current week is a decline to support 1.2150.

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USD Index IPDA 60 Day Ranges Price Movement For April 21, 2020

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The USDX is now in a Premium Array Area. It is trying to go to the Discount Array Area from the Interbank Price Delivery Algorithm (IPDA) 60 Day Ranges. However, now #USDX is likely to test the nearest Liquidity Pool (Clean High) at 100.30 before it declines again to the 98.97-98.82 levels. As long as the #USDX does not retrace 100.93, the bias for #USDX is bearish.

(Disclaimer)

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Technical Analysis of GBP/USD for 21/04/2020:

Technical Market Outlook:

The GBP/USD pair has made a local low at the level of 1.2388 after the 50% Fibonacci retracement had been violated. The larger time frame trend remains up, but in the short-term the bears are in control of the market and the next target for them is located at the level of 1.2369 (61% Fibonacci retracement of the last wave up). Please notice, that the level of 1.2406 had been providing support for some time now, so any violation of this level will lead to a deeper sell-off towards 1.2369 and even 1.2165.

Weekly Pivot Points:

WR3 - 1.2855

WR2 - 1.2741

WR1 - 1.2613

Weekly Pivot - 1.2507

WS1 - 1.2367

WS2 - 1.2267

WS3 - 1.2125

Trading Recommendations:

The fear of the coronavirus consequences is very strong among the global investors and it rules on the financial markets. On the GBP/USD pair the main trend is down, but the reversal is possible when the coronavirus pandemic will be tamed. The key long-term technical support has been recently violated (1.1983) and the new one is seen at the level of 1.1404. The key long-term technical resistance is seen at the level of 1.3518. Only if one of this levels is clearly violated, the main trend might reverse (1.3518) or accelerate (1.1404).

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Technical Analysis of BTC/USD for 21/04/2020:

Crypto Industry News:

For the first time in history, a huge drop in oil prices can be observed, the largest since 1983, while Bitcoin's value remains at USD 7,000. One BTC currently reaches 600 barrels of black gold

According to today's market data, WTI barrel contracts that expire in May lose 36% of their value during the day. Their value is $ -36.37.

It seems that despite attempts to reduce supply, oil markets may reflect the prognosis of Bitcoin supporters and fall even lower. At the same time, the gap between the futures contracts for May and June has widened, which means that despite this change, there is still a belief that there will be a large increase in the price of black gold. This was not enough to avoid unexpected situations on the oil market. On Monday, Western Canadian Select even managed to break into negative prices.

The crypto industry is amused about the situation. CasaHODL co-founder Jameson Lopp wondered on Twitter:

| How long will Antminer S9 work with 1 barrel of oil? "

Others noticed that even 1 Ethereum reached over 15 WTI barrels, while the variability of black gold was clearly visible compared to other macro assets. Over the year, the WTI ratio fell by as much as 64%.

Technical Market Outlook:

The Doji candlestick pattern that has been made at the top of the move of BTC/USD over the weekend has again proved to be the profitable signal as the Bitcoin rate dropped towards the main channel upper boundary line recently. The bears have managed to push the price lower towards the middle of the range as the local low was made at the level of $6.706. The momentum is decreasing and moving into a negative teritorry, so the bears might extend the move down again. Please watch the level of nearest technical resistance located at $6,908 to invalidate the downward scenario.

Weekly Pivot Points:

WR3 - $8,288

WR2 - $7,759

WR1 - $7,459

Weekly Pivot - $6,596

WS1 - $6,675

WS2 - $6,137

WS3 - $5,855

Trading Recommendations:

The fear of the coronavirus consequences is very strong among the global investors and it rules on the financial markets. So far the global investors are not so keen to invest in Bitcoin and treat BTC as a digital gold. The larger time frame trend remains down and as long as the level of $10,791 is not violated, all rallies will be treated as a counter-trend corrective moves. This is why the short positions are now more preferred.

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WTI crude oil (contract for delivery on May 20) drop to 7 cents per barrel

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Oil:

The picture for the Oil contract will be at 18:15 Universal time.

Due to full storage capacity, oil in the United States has fallen to almost zero.

Look at the daily chart above for the details.

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Technical Analysis of ETH/USD for 21/04/2020:

Crypto Industry News:

The BitMEX crypto exchange registered in Seychelles is joining the efforts to fight the global pandemic COVID-19.

Today, the stock exchange operator, HDR Global Trading, has launched a fund to combat coronavirus, while announcing its $ 2.5 million in subsidies to four recipients.

The company claims that the best way to join the global fight against a pandemic are:

"[...] strategically targeted funds that can fill gaps in global operations and quickly strengthen well-equipped but underfunded organizations."

After consulting with their advisors, HDR Global Trading decided to make a donation to two partners of Gates Philanthropy Partners COVID-19 Funds, namely the biosecurity program under the Nuclear Threat Initiative, OpenMined and Our World in Data initiatives.

These organizations focus on policy analysis and capacity-building projects to reduce biological risk, vaccines, diagnosis and treatment development, information verification and open source support for data protection techniques.

HDR Global Trading emphasized that all funds made available through the COVID-19 Response Fund are independent of the personal initiatives of its co-founder Ben Delo, a signatory to Giving Pledge.

It is also worth recalling that the Stellar Development Foundation allocated up to 2.5 million lumens earlier this month for non-profit organizations working to help in crisis situations during a pandemic.

Meanwhile, Binance began efforts to raise $ 5 million in cryptocurrencies to buy medical supplies for the countries most affected by the pandemic, after buying medical equipment for Chinese Wuhan worth $ 1.4 million in January.

Technical Market Outlook:

The ETH/USD pair has made a new local low at the level of $165.65, after the Pin Bar candlestick pattern was made at the top of the move. So far the bears has manage to push the price towards the level of $172.91, which is the lower boundary of demand zone, but the bulls keeps fighting back and are currently testing this level from below. The key short-term support is seen at the level of $164.45 and if violated, the price can drop to the level of $153.46. The market participants await for a decisive breakout in either direction so it is worth to keep and eye on the next develpomnent on the Ethereum market.

Weekly Pivot Points:

WR3 - $240.86

WR2 - $214.90

WR1 - $200.99

Weekly Pivot - $173.55

WS1 - $159.05

WS2 - $132.99

WS3 - $117.12

Trading Recommendations:

The fear of the coronavirus consequences is very strong among the global investors and it rules on the financial markets. So far the global investors are not so keen to invest in cryptocurrency, because they are being perceived as risky assets. The larger time frame trend on Ethereum remains down and as long as the level of $214.67 is not violated, all rallies will be treated as a counter-trend corrective moves. This is why the short positions are now more preferred.

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Indicator analysis. Daily review on GBP/USD for April 21, 2020

Trend analysis (Fig. 1).

Today, the bearish trend may continue from the level of 1.2446 (closing of yesterday's candle) with the first target of 1.2356 - a 23.6% retracement level (presented in a blue dashed line). If this level is broken down, the price may continue to move down with the target of 1.2175 - a 38.2% retracement 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 - down;

- Bollinger Lines - up;

- Weekly schedule - down.

General conclusion:

Today, the price may continue to move down with the target at 1.2175 - a 38.2% retracement level (presented in a blue dashed line).

An unlikely bullish trend from 1.2356 - a 23.6% retracement level (presented in a blue dashed line) with a target of 1.2518 - a 61.8% retracement level (presented in a red dashed line). In case of breaking this level upward, the price may continue to move upward with the target at the upper fractal 1.2648 (presented in a blue dashed line).

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Indicator analysis. Daily review on EUR / USD for April 21, 2020

Trend analysis (Fig. 1).

Today, the bearish trend may continue from the level - 1.0863 (closing of yesterday's candle) with the first target at the lower fractal 1.0813. When this level is broken down, the price may continue to move down with the target at the next lower fractal 1.0769 (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 - down;

- Bollinger lines - down;

- Weekly schedule - down.

General conclusion:

Today, the price may continue to move down with the target at the lower fractal 1.0769 (presented in a red dashed line).

An unlikely bullish trend from a pullback level of 76.4% - 1.0822 (presented in a blue dashed line) with a target of 1.0913 - a 38.2% retracement level (presented in a red dashed line).

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EUR/USD. Oil market is intimidated, but not anymore

Recent events in the oil market have had little impact on the dynamics of the main currency pairs. The key beneficiary of this situation was the greenback - the dollar index again crossed the 100-point line, reflecting increased demand across the entire spectrum of the market. The US currency currently dominates almost all pairs, but dollar bulls are behaving quite modestly, compared to the recent hype that was associated with the spread of the coronavirus. There is more uneasiness than panic in the currency market – a contradictory fundamental background does not allow the dollar to spread its wings, but the historical anti-records that oil traders set yesterday caused anti-risk sentiment to increase, thanks to which the greenback then grew in price. But this price dynamics is not confident – soon traders will switch to other fundamental factors that are more important for the forex market. Therefore, you should not invest in the greenback based only on yesterday's unrest.

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But first, a little more about what happened yesterday. An anti-record was set in the oil market – the value of May WTI oil futures fell below zero for the first time in the history of exchange trading. Quotes dropped to the level of -40 dollars per barrel. The opening price was at the level of 18 dollars, so yesterday's collapse is about three hundred percent relative to the closing levels of Friday's trading. In addition, traders paid attention to another record - the difference between the near and next WTI futures increased to $40, again for the first time in the history of observations.

If we talk about the reasons for such price dynamics, they are quite banal. The reason, in fact, is the lack of demand. Due to this factor, investors withdrew from the May contracts, not shifting to the following (June) contracts. The fact is that if a trader does not have time to close the current contract on paper, then he faces a physical supply of oil. As a rule, raw materials are delivered to the Cushing terminal in the US state of Oklahoma. Stocks in this oil storage facility are rapidly growing, amid a lack of demand. Therefore, it is quite logical that no one wants to buy a contract that expires on the next day and at the same time obliges to take delivery of it. There was no demand even when traders offered to pay extra for the purchase of such futures (in fact, this is why the price went into negative territory), since energy companies do not have enough space to store oil against the background of lack of demand.

The situation that has developed with oil futures contracts, of course, is unpleasant. This is another reminder of the global crisis, the weak demand for oil and the lack of hope for an early recovery of the oil market. The situation with the spread of COVID-19 led to stagnation in the market, overcrowded storage facilities and an excessive supply level. But, according to experts, despite the fact that many players closed their positions in the financial market yesterday, there is no critical overstock in the physical market, and a sharp drop in prices occurred at the time when contracts were executed. That is why the foreign exchange market reacted so weakly to yesterday's events. In addition, today the cost of futures for WTI with delivery in May has returned to positive territory: at the moment, the price on the NYMEX exchange has risen to $1.40. June WTI futures also rose in price to $21.33.

Given such a rebound, it can be assumed that currency market traders will soon switch to other fundamental factors that will directly affect the dynamics of the US currency. Therefore, you are advised to ignore the EUR/USD pair's current fall to the 1.0850 level - the dollar strengthened due to yesterday's nervousness in the commodity market. More powerful news is needed in order to confirm the downward movement of the EUR/USD. Moreover, today's dynamics of WTI and Brent does not make it possible for dollar bulls to continue their mini-rally.

But you should pay special attention to today's report from the Centre for European Economic Research (ZEW Institute). Positive dynamics are expected in both Germany and the eurozone as a whole, although indicators will remain deep in the negative area. So, if the German index reached -49 points in March, then it should rise to -40 in April. Doubtful achievement, but the dynamics are important here. The euro will be under strong pressure if the figure continues to decline further. There are certain prerequisites for this: the coronavirus factor, the pessimistic report of the IMF, the dovish rhetoric of Lagarde, the slowdown in inflation, weak German data - all these circumstances cannot but affect the mood of entrepreneurs. But here it is worth emphasizing that the European currency will stay afloat if the real numbers coincide with the forecast values. Otherwise, if the downward trend is of a larger scale, the EUR/USD pair bears will receive a reason to fall.

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Thus, the risk of losing a short position is quite high at the moment - that is, on the one hand, you can take a chance and sell from current positions, with a downward target of 1.0800 and a mandatory stop loss at 1.0910 ( in this price area, the lines Tenkan-sen, Kijun-sen and the middle line of the Bollinger Bands indicator on the daily chart coincided). However, trading decisions after the release of data from the ZEW Institute (09:00 London time) will look more justified - if the indicators come out in the green zone, it will be problematic for the bears to pull the pair to the bottom of the eighth figure, while the probability of a correction to the resistance level of 1.0910 will increase in many ways.

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Elliott wave analysis of Brent Crude Oil for April 21 - 2020

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Brent Crude Oil is now in its final stages of a huge ending diagonal and it's just a matter of time before a long-term bottom is in place. Over night we saw Crude Oil spike to an unbelievable low of USD -37.5 pr. barrel. It is a financially crazy world we are living in. We see negative interest rates and now negative commodity prices...

The risk of a similar drop lower in Brent crude oil is highly probable. Therefore, we recommend staying cautious. A break above minor resistance at 29.38 will be a good indication that a long-term low is in place and a rally to at least 70 is in motion.

Trading recommendation:

It is better to take a wait-and see approach as the oil price may plunge to extreme low. However, a break above 29.38 will indicate that a long-term low is in place and we can bet on rally towards 70.00.

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Elliott wave analysis of GBP/JPY for April 21 - 2020

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Our patience was finally rewarded as GBP/JPY broke below key-support at 133.69 confirming that wave iv has completed and wave v is in motion for a decline to below 123.99 to complete the long-term decline from 147.96 and even the 156.61 high.

The next support to look for is seen at 132.48 which could prove just as stubborn a support as 133.69 proved itself to be, but ultimately this support should be broken too.

Resistance is now seen at 133.69 and again at 134.49

R3: 135.05

R2: 134.49

R1: 134.05

Pivot: 133.69

S1: 133.00

S2: 132.48

S3: 131.86

Trading recommendation:

We are short GBP from 134.35 and we will lower our stop to 135.00

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Hot forecasts and trading signals for the EUR/USD and GBP/USD pairs for April 21

EUR/USD. 1H

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The euro/dollar pair performed several rebounds from the Senkou span b line on the hourly chart, which is a very strong resistance. An upward trend line that was not that strong was built yesterday, which the EUR/USD pair successfully overcame at night. In general, trading was very active, so after overcoming the trend line, the US dollar has already risen by 40 points. In general, at this time, it is impossible to say that the US dollar is in demand among traders. Moreover, both the euro and the pound can now move in the side channels on 4-hour timeframes. A move upwards could follow in the 1.0814 area with further movement to the Senkou Span b line. Based on the foregoing, we have two trading ideas for April 21:

1) We expect quotes to fall, at least, to the 1.0817 area, from which there have already been rebounds. Thus, those traders who are in shorts can remain in them for this purpose. In case you overcome this level of sales, it is advised to remain with the target of 1.0793.

2) It is very likely for quotes to rebound from 1.0817. If it happens, then the hypothesis of a sideways movement on the 4-hour timeframe will become more real. Therefore, in this case, traders are advised to buy the euro with the goal of the Senkou span b line (1.0878). The potential to take profit in this case will be around 60 points.

GBP/USD 1H.

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The GBP/USD currency pair continues its downward movement and was unable to complete another rebound from the support line, which runs at 1.2416. The Senkou span b line of the Ichimoku indicator did not deter the pair from further downward movement. This morning, the pound/dollar pair also managed to work out the first support level for the 4-hour timeframe at 1.2388. Thus, the current intraday picture suggests the following trading ideas:

1) Overcoming the support level of 1.2388 could provoke the pound to fall further. In this case, we can ascertain that three important supports can be overcome at once - the support line of 1.2416, the support level of 1.2388 and the Senkou Span B line at 1.2405. Thus, we advise you to sell the pair while aiming for 1.2276 in this case.

2) If the first support level of 1.2388 is not reached, this will mean that the pair is not ready to continue the downward movement. In this case, we advise traders to wait for quotes to close above the downward trend line (yellow) and open buy orders with the target Kijun-sen line at 1.2525.

We highlight the release of data from the UK among the important macroeconomic events today, among which the report on applications for unemployment benefits will stand out. Although in general we believe that traders will continue to ignore the macroeconomic background.

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The euro and the pound are expected to fall. Traders are less optimistic.

Signals for the EUR/USD pair:

The euro is expected to grow to 1.0894 and 1.0937, if the pair breaks through the level of 1.0851.

A breakthrough at 1.0825 can lead to a sell-off of the euro at 1.0814 and 1.0770.

Signals for the GBP/USD pair:

If the pair breaks through the level of 1.2408, the British pound can increase to 1.2462 and 1.2512.

A breakthrough at 1.2400 is likely to lead to a sell-off of the British pound at 1.2358 and 1.2294.

Fundamental data:

Unemployment data in the UK, Germany Zew economic sentiment index, and the US home sales are set for release today.

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

EUR/USD: plan for the European session on April 21. COT reports. Buyers continue to believe in growth, but this does not

To open long positions on EURUSD, you need:

The increase in the debt burden of the eurozone member countries has a negative impact on the European currency, which is going through a difficult time ahead of a number of important fundamental statistics that are waiting for us this week. Despite the fact that buyers continue to believe in strengthening the pair, this does not help the market much. The Commitment of Traders (COT) reports for April 14 recorded another increase in long positions, while short positions decreased, which positively affected the Delta. This indicates market expectations in favor of the European currency. Short non-commercial positions fell from 81,561 to 78,461, while long non-commercial positions jumped from 161,185 to 165,078. As a result, the positive non-commercial net position continued to increase in value, and reached 86,617 against 79,624, which indicates a clear interest in buying risky assets at attractively low prices. As for the intraday strategy, an unsuccessful attempt to break above the resistance of 1.0894 yesterday in the afternoon smoothly pushed the European currency under the 1.0851 level, which indicates the advantage of sellers. At the moment, the bulls need to regain the resistance of 1.0851 as soon as possible, which will be a signal to buy while expecting an update of the upper border of the side channel of 1.0894, where I recommend taking profits. If the pressure on the euro continues in the first half of the day, then you can expect to buy only if a false breakout is formed near the lower border of the channel 1.0814, which is what sellers are now aiming for. Otherwise, it is best to open long positions immediately on a rebound from the April low of 1.0770.

To open short positions on EURUSD you need:

Sellers achieved a break in the middle of the channel 1.0851 today during the Asian session, which they tried to do all day yesterday. At the moment, an important task will be to hold this range, where forming a false breakout will be a direct signal to open short positions based on the third test of the lower border of the 1.0814 side channel. A break in this area will lead to a larger sell-off of EUR/USD, and today's data on the mood and expectations in the German economy will only raise the pressure on the pair, opening a direct path for it to the April low of 1.0770, where I recommend taking profits. If the demand for the euro remains above the resistance of 1.0851, then it is best to return to short positions on the rebound from the high of 1.0894.

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Signals of indicators:

Moving averages

Trading is below 30 and 50 moving averages, which indicates the preservation of the bear market.

Note: The period and prices of moving averages are considered by the author on the hourly chart H1 and differs from the general definition of the classic daily moving averages on the daily chart D1.

Bollinger bands

A break of the lower border of the indicator at 1.0845 raises the pressure on the European currency. In the case of an upward correction, the upper border of the indicator in the 1.0890 area will act as resistance.

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
  • Non-profit traders are speculators, such as individual traders, hedge funds and large institutions that use the futures market for speculative purposes and meet certain requirements.
  • Long nonprofit positions represent the total long open position of nonprofit traders.
  • Short nonprofit positions represent the total short open position of nonprofit traders.
  • The total non-profit net position is the difference between short and long positions of non-profit traders.
The material has been provided by InstaForex Company - www.instaforex.com

USD/CAD testing upside confirmation, potential bounce!

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Trading Recommendation

Entry: 1.4165

Reason for Entry: horizontal swing high, 38.2% fibonacci retracement

Take Profit :1.4292

Reason for Take Profit: 100% Fibonacci extension , 50% fibonacci retracement

Stop Loss: 1.3996

Reason for Stop loss: 61.8% fibonacci retracement

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

Forecast for EUR/USD for April, 21, 2020

EUR/USD

Oil and US stock indices fell on Monday. Investors again felt fear and continued to buy up the dollar as a safe haven currency. And although the euro fell by only nine points yesterday, fears and uncertainty will continue to dominate the markets for several more days.

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The picture remained unchanged on the daily chart - the price is under the indicator lines of balance and MACD, the Marlin oscillator moves horizontally in the negative trend zone. The 1.0610 target for supporting the embedded price channel line of a higher timeframe is maintained.

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The situation is also unchanged on the four-hour chart, with the only difference being that the indicator lines have started to go down, which strengthened the potential for decline. The final condition for the price to move to 1.0610 will be for the price to overcome Friday's low at 1.0812. Accordingly, short positions can be opened from this level.

An alternative short-term scenario suggests another branch of price growth to the MACD line on the H4 towards the area of 1.0930.

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Forecast for AUD/USD on April 21, 2020

AUD/USD

The Australian dollar turned down from the price channel line and fell by 30 points on Monday. To date, the price has overcome the support of the MACD line on the daily chart (0.6316).

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Overcoming this support starts the movement towards the first target of 0.6175 - to support the underlying embedded price channel line. The second goal will be the next line of the price channel in the region of 0.5798. The Marlin indicator continues to decline.

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The price continues to decline under the balance (red indicator) and MACD (blue) lines on the four-hour chart. Marlin also headed for a new wave of decline after a reversal from the border of the growth territory.

Summary: it is possible to open short positions in the market with stop loss above 0.6398 and take profit above 0.5798.

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Forecast for USD/JPY on April 21, 2020

USD/JPY

Yesterday, the Japanese yen made minor fluctuations under the balance line on the daily chart and in the consolidation range of 106.87-108.10. The signal line of the Marlin oscillator is still forming a wedge. The exit from the wedge is most likely to occur downwards.

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Pressure is gradually increasing in foreign markets. Yesterday, the US stock index S&P 500 fell 1.79%, today the Japanese Nikkei 225 is losing 1.34%. The fall of the stock market shifts investor sentiment towards buying a protective yen against the dollar.

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The price is above the balance and MACD lines on the four-hour chart, here the signal level is the support of the MACD line at 107.40, overcoming which will be an early signal for aggressive trading fans to open short positions. A stable signal for a medium-term decline in the pair will be when the price leaves the lower border of consolidation at the 106.87 level. The goal is 102.50, along the nearest line of the price channel of the higher weekly scale.

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AUDJPY below trendline resistance and moving average. Further drop to come!

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Trading Recommendation

Entry: 68.319

Reason for Entry: Moving average resistance

Take Profit : 66.505

Reason for Take Profit: -61.8% and 61.8% Fibonacci retracement

Stop Loss: 69.231

Reason for Stop loss: End of gap, 61.8% Fibonacci extension

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AUD/CAD approaching resistance, potential drop!

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Trading Recommendation

Entry: 0.90233

Reason for Entry: horizontal swing high resistance, 127.2% fibonacci extension and 88.6% fibonacci retracement

Take Profit : 0.88157

Reason for Take Profit: Horizontal pullback support, 38.2% fibonacci retracement and 61.8% fibonacci extension

Stop Loss: 0.91483

Reason for Stop loss: Horizontal swing high resistance

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Overview of the GBP/USD pair. April 21. Rallies in the United States against "lockdown". Donald Trump's desire to conduct

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - downward.

Lower linear regression channel: direction - upward.

Moving average (20; smoothed) - sideways.

CCI: -81.1651

The British pound paired with the US dollar is trading very weakly and reluctantly at the beginning of the new week. Formally, the pair completed the fixation under the moving average line. However, in fact, over the past few days, there have already been 5 such fixations. Thus, it is the pound/dollar pair that is closest now to a flat movement over the next few days. The pair is currently between the levels of 1.2410 and 1.2510. This results in a side-channel with a width of 100 points, which is not a high value. On the first trading day of the week, there were no macroeconomic statistics in the UK and the United States. However, market participants continue to ignore 99% of news and reports. Thus, now traders are offered either to trade between the upper and lower border of the side channel or to resume opening positions only after the pair's quotes exit from this channel.

Meanwhile, the issue of opening the country's economic borders and ending the quarantine continues to persist in the United States, despite the fact that the epidemic has not yet been defeated and that the United States is now leading the world in terms of the number of deaths from the epidemic and the number of cases. However, as we have repeatedly written, for Donald Trump, the coming months may be crucial in the fight for the presidential seat in the 2020 elections. We have already said that the main trump cards were leveled by the "coronavirus" epidemic: the unemployment rate is growing and may rise to 50-year highs, the labor market is in a deplorable state, and the economy is in a severe recession. In general, the crisis is already being compared to the Great Depression. So, as part of the election campaign, Donald Trump will need to answer the question, why should Americans elect him President for the second time in a row? If earlier Trump could say that it was under him that the United States showed significant economic growth, and the unemployment rate fell to 50-year lows, now the President can not say anything like that. And so it will be much more difficult for him to win the presidential race since Joe Biden will only have to make beautiful promises to the Americans. Thus, Trump's desire to restart the US economy as soon as possible is obvious. And, according to official information, the US President is supported in this desire by at least 15 states of the country, which last week held rallies against the current quarantine measures. During these rallies, the protesters wore no masks, did not observe the rules of social distance, and demanded to be allowed to return to work as soon as possible. State governors were also criticized, and the threat of "coronavirus" was questioned. The reaction of Donald Trump, who initially supported the removal of the "lockdown", did not have to wait too long. The US President called the protesters "wonderful people" and said that "people just want their lives back." "Their lives were taken from them. I have never seen so many American flags as at these rallies. These people love our country. They want to get back to work," Trump said. At the same time, official information suggests that the number of people at these rallies was extremely small. Only a few thousand people don't work. Thus, the majority of the US population, we can conclude, still does not support any removal of "lockdowns" to the detriment of their own health and life. The economy is certainly important, but life is more expensive. Moreover, any rally can be organized by those who will benefit from it. In this situation, Donald Trump himself. Of course, there are always people who are ready to stand on a square and shout slogans prepared in advance for a few 100-dollar bills. It should be understood that it is Trump who needs to return the country's economy to its usual course. It is against Trump that time is playing now.

The US President also seems to be preparing to impose new duties and trade restrictions on China, accusing it of deliberately spreading a "coronavirus" infection. The US leader wants to send his investigators and experts to the province of Wuhan, who will have to figure out whether the virus accidentally broke free from a Chinese laboratory? It is clear that China rejects all official requests, which gives Trump reason to assume that "the case is not clean." Knowing the American President, it is unlikely that he will leave this story aside. Trump urgently needs to find the culprits before this year's election. China and the WHO are excellent candidates for these positions. WHO has already "incurred the penalty" of refusing to fund the organization by the United States. Now it's China's turn.

Meanwhile, the total number of infected people in the UK reached 126,000. The number of "fatal cases" is 16,500. At the same time, British Newspapers continue to criticize Boris Johnson for responding too late to the epidemic and taking too lenient quarantine measures. According to newspaper reports, the UK lost as much as 5 weeks at the very beginning of the outbreak. As a result, the country was completely unprepared for the epidemic. Many newspapers were able to interview doctors and scientists who said that in early February, the government did not do anything in case the pandemic reached the Foggy Albion. At that time, it was already known that the virus was transmitted from person to person, and a total quarantine was declared in Hubei province. The British authorities assured that the country is ready for any kind of emergency, but, as it turned out in practice, many stocks of protective equipment for doctors have not been replenished for many years, many of them have expired. It is also reported that the quarantine was proposed to be introduced in early February, when it became known about the high degree of infection of the COVID-2019 virus, but it was introduced only on March 23.

On Tuesday, the UK is scheduled to publish the unemployment rate (for February), the number of applications for unemployment benefits (for March) and changes in average wages (for March). We believe that only the number of applications for benefits is important. But even this can be ignored by traders. No important information is expected from overseas today.

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The average volatility of the GBP/USD pair has stopped decreasing and is currently 132 points. In the last 18 trading days, the pair almost every day passes from 100 to 200 points. Therefore, we can say that volatility is now stable. On Tuesday, April 21, we expect movement within the channel, limited by the levels of 1.2319 and 1.2583. A reversal of the Heiken Ashi indicator upwards will indicate a new round of upward movement inside the side channel of 1.2410-1.2510.

Nearest support levels:

S1 - 1.2451

S2 - 1.2390

S3 - 1.2329

Nearest resistance levels:

R1 - 1.2512

R2 - 1.2573

R3 - 1.2634

Trading recommendations:

The GBP/USD pair on the 4-hour timeframe is currently trading just below the moving average line. Thus, formally, short positions with the targets of 1.2390 and 1.2329 are now relevant. However, we recommend that traders wait until the end of the flat, that is, the pair's quotes exit from the range of 1.2410-1.2510, and only then resume trading.

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Overview of the EUR/USD pair. April 21. Christine Lagarde, Luis de Guindos and the IMF predict a serious fall in the Eurozone.

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - sideways.

Lower linear regression channel: direction - sideways.

Moving average (20; smoothed) - sideways.

CCI: -57.9978

The EUR/USD currency pair did not change its technical picture too much during the first trading day of the week. More precisely, it hasn't changed at all. Throughout Monday, there was an open flat and reluctance of traders to open new positions. On the one hand, this is good, as the flat is better than moving 200-300 points daily. On the other hand, trading in the current conditions is also not very convenient. The pair simply stands in one place. Based on this, we still insist on our scenario of "consolidation after an ultra-volatile month and a half of trading". If this scenario really came into effect, then the euro/dollar pair will continue to move between the levels of 1.0800 and 1.0900 for some time. During this time, all price anchors above/below the moving average line, rebounds/surmounts of the Murray levels, and other technical signals of the "linear regression channels" system will be weak. Volatility levels, if the pair remains flat, will also be a mere formality, since they will not be worked out. Based on all the above, traders now need new data that would allow them to break out of the flat and start forming a new trend. Unfortunately, there are no major events on the horizon. Thus, we believe that a flat or very similar movement can be observed within one to two weeks.

On Tuesday, April 21, the macroeconomic background will be extremely weak. On this day, only three ZEW indicators are scheduled to be published: the EU economic sentiment index (forecast -62), the German business sentiment index (forecast -42.8) and the German current economic conditions assessment index (forecast -82.3). It is not difficult to guess that all three indices will go below the waterline by the end of April, but much below it. The March figures were extremely weak, and in April they will be frankly disastrous. And we believe that all economic indicators for the European Union, the United States and other countries of interest are about the same. The first month of the epidemic in the EU and overseas was very tough. However, the situation did not change in April. The quarantine persists, and the economy continues to idle. Thus, in April, there will be a further reduction in all indicators of the EU and US economies. Therefore, positive figures should not be expected. However, this does not matter for the euro/dollar currency pair. First, ZEW indices are formal indicators that do not affect the behavior of traders. Second, market participants continue to ignore any macroeconomic statistics. Third, the EU and US economies are declining synchronously and at approximately the same pace, so traders now have no reason to buy the euro or the dollar on the basis of a larger reduction in one or another economy.

But what is more than enough now is forecasts for the final losses of the world economy, as well as the economy of each individual country due to the "coronavirus" epidemic. We have already read the forecasts of the IMF, Bloomberg, Morgan Stanley, and other world-famous structures. Echoed by ECB chief Christine Lagarde, who believes that the Eurozone has already faced a sharp drop in GDP and the labor market. "Uncertainty is very high and will remain high for some time, making it extremely difficult to predict the potential scale and duration of a recession, as well as the timing of economic recovery," Lagarde said. Recall that the IMF predicted a 7.5% reduction in the European economy in 2020.

Meanwhile, a crisis is still brewing in Europe amid different views of the northern and southern countries on the question of supporting the regions most affected by the "coronavirus". Recall that the most affected countries are now Spain, Italy, and France. These are the countries that require support from the ECB. However, the ECB cannot simply pour any amount of money into any country's economy. Now the process of pumping the economy with cash is carried out through the purchase of government bonds of a country. However, there are limitations here as well. Some countries, like Germany, Austria, and Finland, believe that the governments of Italy, Spain, and France should handle their own problems. The crisis is one for everyone. If the ECB continues to buy government bonds of the most affected countries, it may lose the support of Germany and other most powerful countries.

At the same time, it is reported that the EU countries will need at least 1.5 trillion euros more to counter the consequences of the crisis. This was announced by EU Commissioner for Economics Paolo Gentiloni. "The Eurogroup has made offers of assistance worth more than 500 billion euros to finance the health sector and short-term assistance, as well as to support small and medium-sized enterprises," Gentiloni said. Thus, it remains to find another trillion euros for other needs. The European Union, according to ECB Vice-President Luis de Guindos, will suffer the most from the current crisis. Not least because the EU already has troubled Greece and Italy. The first – was on the verge of leaving the EU after the mortgage crisis, the second – has a much higher level of public debt than prescribed by EU regulations. On this basis, the ECB suggests that Brussels create a "Single Bank of Bad Assets" in the Eurozone, to which various financial companies will transfer problem debts. The purpose of creating this bank is to get rid of many problematic and bad loans that have remained on the balance sheets since the 2008 mortgage crisis. The ECB fears that the new crisis will cause a new wave of growth of bad loans and, accordingly, the banking system will suffer again, its ability to issue new loans will be severely limited, which will slow down the process of economic recovery after the "coronavirus crisis". However, the European Commission is opposed to this idea, as it does not want to violate the principle that the state helps the bank only after the procedure of rehabilitation. The European Commission also believes that there is a more acceptable way to dispose of bad loans.

From a technical point of view, it is now difficult to distinguish the boundaries of a possible side channel. So for now, traders are advised to just keep this thought in mind and not expect a strong movement. However, formally, the euro/dollar pair may still rebound from the moving average and resume its downward movement, since so far the flat is only an assumption based on a fairly strong drop in volatility.

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The volatility of the euro/dollar currency pair as of April 20 is 88 points per day. Thus, fears for a new wave of panic in the market are still untenable, and market participants continue to reduce their level of activity. Today, we expect the pair's quotes to move between the levels of 1.0773 and 1.0949, and in general – quiet trading. A downward reversal of the Heiken Ashi indicator may indicate the end of an upward correction.

Nearest support levels:

S1 - 1.0864

S2 - 1.0742

S3 - 1.0620

Nearest resistance levels:

R1 - 1.0986

R2 - 1.1108

R3 - 1.1230

Trading recommendations:

The EUR/USD pair continues its corrective movement against the new downward trend. Thus, traders are advised to wait for its completion and again trade down with the targets of the volatility level of 1.0773 and the Murray level of "0/8"-1.0742. It is recommended to consider buying the euro/dollar pair if the price is fixed back above the moving average, with the goals of 1.0949 and 1.0986.

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