Fractal analysis of Gold, Silver, Oil, and Natural Gas on May 5

Forecast for May 5:

Analytical review in H1 scale:

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For Gold, the main key levels on the H1 scale are: 1740.22, 1731.37, 1717.46, 1707.34, 1690.06, 1682.54, 1677.98 and 1669.38. Here, the price registered a small potential for the upward movement of May 1. A short-term upward movement is expected in the range of 1707.34 - 1717.46. The breakdown of the last level will lead to a pronounced movement. Here, the target is 1731.37. For the potential value for the top, we consider the level of 1740.22. Upon reaching which, we expect consolidation, as well as a downward pullback.

A short-term downward movement is expected in the range of 1690.06 - 1682.54. The range of 1682.54 - 1677.98 is a key support for the top and the price passing this level will lead to the development of a downward structure. In this case, the target is 1669.38.

The main trend is building potential for the top of May 1

Trading recommendations:

Buy: 1708.00 Take profit: 1717.00

Buy: 1718.00 Take profit: 1730.00

Sell: 1690.00 Take profit: 1683.00

Sell: 1677.00 Take profit: 1670.00

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For Oil, the main key levels on the H1 scale are: 28.69, 26.32, 22.34, 19.98, 18.52, and 16.24. Here, we are following the development of the ascending structure of April 20. The continuation of the upward movement as an impulse, is expected after the breakdown of 22.34. In this case, the target is 26.32. We consider the level of 28.69 to be a potential value for the upward trend. Upon reaching which, we expect consolidation, as well as a downward pullback.

A short-term downward movement is possible in the range of 19.98 - 18.52. The breakdown of the last level will lead to an in-depth correction. In this case, the target is 16.24. This level is a key support for the top.

The main trend is the potential upward structure of April 20, we expect local initial conditions to clarify goals.

Trading recommendations:

Buy: 22.60 Take profit: 26.30

Buy: 26.60 Take profit: 28.60

Sell: 19.90 Take profit: 18.55

Sell: 18.30 Take profit: 16.50

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For Silver, the main key levels on the H1 scale are: 15.27, 15.16, 15.00, 14.66, 14.43, 14.16 and 13.95. Here, the price forms a downward potential of April 30. The continuation of the downward movement is expected after the breakdown of the level of 14.66. In this case, the target is 14.43. Price consolidation is near this level. The breakdown of the level of 14.43 should be accompanied by a pronounced downward movement. Here, the goal is 14.16. For the potential value for the bottom, we consider the level of 13.95. Upon reaching which, we expect consolidation, as well as an upward pullback.

A short-term upward movement is possible in the range of 15.00 - 15.16. The range of 15.16 - 15.27 is a key support for the descending structure of April 30 and the price passing this range will lead to the formation of initial conditions for the top. In this case, the potential target is 15.44.

The main trend is the formation of the downward potential of April 30

Trading recommendations:

Buy: 15.00 Take profit: 15.16

Buy: 15.27 Take profit: 15.44

Sell: 14.66 Take profit: 14.44

Sell: 14.42 Take profit: 14.16

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For Natural Gas, the main key levels on the H1 scale are: 2.363, 2.302, 2.192, 2.068, 2.008, 1.908, and 1.815. Here, we are following the development of the ascending structure of April 27. The continuation of the upward movement is expected after the breakdown of the level of 2.192. In this case, the target is 2.300. For the potential value for the top, we consider the level of 2.363. The movement to which is expected after the breakdown of the level of 2.302.

A short-term downward movement is possible in the range of 2.068 - 2.008. The breakdown of the last level will lead to an in-depth correction. Here, the potential target is 1.908. This level is a key support for the upward structure and its breakdown will lead to the formation of initial conditions for the downward cycle.

The main trend is the upward structure of April 27

Trading recommendations:

Buy: 2.194 Take profit: 2.300

Buy: 2.305 Take profit: 2.360

Sell: 2.068 Take profit: 2.010

Sell: 2.000 Take profit: 1.910

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Trading idea for May 5, 2020. EUR/USD. The coronavirus recedes in Western countries. Weak economic reports

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Mainland Europe finally records daily deaths no higher than 300, even in lagging Britain. Germany also observed a sharp drop in deaths for 5 consecutive days.

US also records a decrease in fatality, with deaths of about +2,500 per day, twice lower than the highest figure recorded. The pandemic also seems to be receding in Western countries, which are beginning to gradually open economies. Most countries will open before the end of May.

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The US market tried to rally but failed, finally realizing that the economic problems are just beginning. Yesterday, industrial orders for March fell by 10%, worse than the forecast, and today, the ISM service index will be released, where a severe decline is expected.

The market awaits the labor market report on Wednesday and Friday - 21 million unemployed, with a rate of 16%, is expected in the US.

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EUR/USD: Place purchases from 1.0850.

Purchases are also possible from 1.0910.

Stop at 1.0850.

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

Markets take a temporary break before Friday's employment report; Overview of CAD and JPY

Markets are set up complacently on Tuesday morning, US stock indexes showed a slight increase the day before, oil is trying to push off the base, and yields have stopped falling. Trends give a temporary advantage to commodity currencies, but the chances that this is a long-term reversal are still vanishingly small.

The dynamics of a fall in production orders in March in the USA is impressive, while forecasts for April are much worse.

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An increased volatility is possible today, the reason for which may be the publication of the ISM services sector.

USD/CAD

Canada will present quite a lot of macroeconomic data this week, which may lead to a rise in loonie. One hundred companies from the TSX list will publish income level reports, an employment report in April will be released on Friday, forecasts are extremely negative. According to preliminary estimates, the Canadian economy lost 5.5 million jobs, the unemployment rate could jump to 20%.

The Bank of Canada is going through a change of manager, Poloz will give way to Macklem, whose views so far are a mystery to investors. In particular, it is unclear whether the possibility of introducing negative rates is being considered, although it is known that he adheres to the position of the former head of the Fed, Bernanke and is inclined to consider the current crisis not a fundamental, but rather a "natural disaster," which is a bullish factor for loonie.

The net short position in Canada increased again and amounted to 2.075 billion last week, the dynamics are negative, and if it were not for attempts to restore oil prices, the forecast would be in favor of a further decrease in the loonies. The estimated fair price is much higher than the spot price. There is no obvious direction, so the probability of further growth of USD/CAD looks preferable.

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According to the combination of factors, the USD/CAD pair looks neutral and will continue to trade in the range of 1.3850 - 4260. The bullish mood supports the reduction of tension, but it is highly likely that we should wait for another wave of panic, which will allow USD/CAD to resume growth. In general, we need to focus on finding reasons to buy, since the current decline in tension is temporary.

USD/JPY

A serious drop in domestic and foreign demand led to an even faster decline in production in Japan in April than in March. Employment has declined at the highest rate since June 2009, e June 2009, and expectations are at their lowest since the index was calculated.

Jibun Bank Japan's PMI index fell to an 11-year low, signaling a sharp deterioration in business conditions and a growing wave of order cancellation reports. Over the 12-month period, Jibun Bank sees no reason to improve the situation.

The drop in domestic demand has led to the fact that the long-standing struggle of the Bank of Japan and the government with deflation threatens to end in total defeat. Tokyo's consumer price index fell in April to 0.2%, and although it is still far from the 2009 lows, the trend is clear.

The CFTC report showed a growing interest of speculators in the yen, the net long position rose to $ 3.781 billion, and the estimated fair price tends to increase, which indicates growing risks of the yen strengthening.

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The slowdown in the USD/JPY decline is due to the temporary effect of positive growth from a decline in the spread of coronavirus and the emergence of plans to exit the restrictive measures of several countries. However, the dynamics of demand in the futures market, as well as the decline in US bond yields, indicate that the players have not yet seen reasons for strengthening the dollar, since the yen currently looks like a clear favorite.

Data on household spending and wage levels for March will be published on Friday, forecasts are extremely negative, and a further increase in USD/JPY could be stopped by a significant increase in liquidity by the Bank of Japan, but no steps in this direction were presented at the last meeting.

The situation is clearly in favor of the yen. Testing the support of 106.30/40 seems more and more likely. The impulse may turn out to be very strong if it is supported by news of a fundamental nature. It is logical to use a possible increase in resistance 106.80/90 for selling with the first goal of 106.34, in case of breaking through of support, sales should be strengthened, since the yen can move without correction to the support zone 104.70/90.

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Indicator analysis. Daily review on GBP / USD for May 5, 2020

Trend analysis (Fig. 1).

Today, an upward pullback is possible from the level of 1.2443 (closing of yesterday's candle) with the target at 1.2496 - a 61.8% pullback level (presented in a red dotted line). In case of breaking this level upwards, the next target will be at 1.2555 - a 75.4% retracement level (presented in a red dashed line).

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Fig. 1 (daily chart).

Comprehensive analysis:

- Indicator analysis - down;

- Fibonacci levels - up;

- Volumes - up;

- Candlestick analysis - down;

- Trend analysis - up;

- Bollinger Lines - up;

- Weekly schedule - up.

General conclusion:

Today, the price may move upwards with the target of 1.2496 - a 61.8% retracement level (presented in a red dotted line). In case of breaking this level upwards, the next target will be at 1.2555 - a 75.4% retracement level (presented in a red dashed line).

Another possible but unlikely scenario is a bullish trend from the level of 1.2496 - a 61.8% retracement level (presented in a red dashed line) with a target at 1.2357 - a 23.6% retracement level (presented in a blue dashed line). If this level is broken downwards, the price may continue to move downwards with the target of 1.2176 - a 38.2% retracement level (presented in a blue dashed line).

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Control zones for AUDUSD on 05/05/20

The pair is trading outside the monthly CZ after trading ended in April. This indicates a high probability of a return to the 0.6322 level. Today, the instrument is located near the CZ 1/2 0.6473-0.6464. Testing this zone will become decisive for further movement. In case an Absorption pattern is formed, sales will come to the forefront, the first goal of which will be a return to the 0.6322 level.

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After returning to the upper border of the monthly control zone in April, the price may continue the downward movement to the WCZ 1/2 0.6283-0.6274.

An alternative growth model will develop if today's trading closes above the WCZ 1/2. This will indicate a continuation of the upward medium-term momentum . Purchases from current levels and above are not profitable, since the likelihood of the pair returning to the monthly CZ in April is at 90%.

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Daily CZ - daily control zone. The area formed by important data from the futures market, which changes several times a year.

Weekly CZ - weekly control zone. The zone formed by important marks of the futures market, which changes several times a year.

Monthly CZ - monthly control zone. The zone, which is a reflection of the average volatility over the past year.

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

Control zones for USDJPY on 05/05/20

A downward medium-term model is under development. This makes it possible to hold previously opened sales and consider new ones. The main goal of the fall is the weekly control zone 105.69-105.33. It is important to understand that any growth is corrective until the WCZ 1/2 is broken.

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Work in the downward direction is profitable even from current levels, however, to get more favorable prices, you can wait for growth to the opening point of yesterday's trading.

An alternative model has a lower probability of being implemented. Purchases from current levels are not profitable. To disrupt the current downward trend, it will be necessary to close today's trade above yesterday's high. This will allow you to start working within the flat zone that was formed at the end of last week.

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Daily CZ - daily control zone. The area formed by important data from the futures market, which changes several times a year.

Weekly CZ - weekly control zone. The zone formed by important marks of the futures market, which changes several times a year.

Monthly CZ - monthly control zone. The zone, which is a reflection of the average volatility over the past year.

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

Trading idea for the CAD/JPY pair

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Good afternoon traders! A trading idea for the CAD/JPY pair.

The global financial crisis pulled the rates of all currency pairs down, but the CAD/JPY pair is the instrument which has recovered less than all cross-rates, the reason of which is the weakness of the Canadian dollar amid the collapse of oil prices. But the growth potential is large, including and due to the gradual recovery of oil quotes. Thus, I suggest rallying the pair according to this scheme:

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The idea is to set a grid of long orders with a step of 30-100p in 4 digits, and then hold profitable positions to the nearest technical level in the area of 78.5.

The method involves calculating the volume of each transaction relative to the deposit with reference to the grid step. We recommend using the trader's calculator, not the increase in volume, when opening new positions.

You can start from the current prices.

Good luck!

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

NZD/JPY approaching resistance, potential drop!

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Trading Recommendation

Entry: 65.093

Reason for Entry: horizontal overlap resistance, 50% fibonacci retracement

Take Profit : 64.344

Reason for Take Profit: horizontal swing low support

Stop Loss: 65.377

Reason for Stop loss: 61.8% fibonacci retracement

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

Indicator analysis. Daily review on EUR / USD for May 5, 2020

Trend analysis (Fig. 1).

Today, the downward trend will continue from the level of 1.0909 (closing of yesterday's candle) with the target at 1.0873 - a 50.0% pullback level (presented in a red dashed line).

A breakdown of this level downwards is unlikely, although, from this level, there is a high probability that the price may start to move upwards with the target of 1.0930 - a 76.4% retracement level (presented in a blue dotted line). From this level, the upward movement is likely to continue.

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Fig. 1 (daily chart).

Comprehensive analysis:

- Indicator analysis - down;

- Fibonacci levels - down;

- Volumes - down;

- Candlestick analysis - down;

- Trend analysis - up;

- Bollinger Lines - up;

- Weekly schedule - up.

General conclusion:

Today, the price may begin to move upwards after moving down to 1.0873 - a 50.0% pullback level (presented in a red dashed line) with the target of 1.0930 - a 76.4% pullback level (presented in a blue dashed line). From this level, the upward movement is likely to continue.

Another possible but unlikely scenario is a bullish trend from the level of 1.0909 (closing of the Friday afternoon candle) breaking through the level of 1.0954 - an 85.4% pullback level (presented in a blue dotted line).

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

Elliott wave analysis of EUR/GBP for May 5, 2020

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EUR/GBP is currently in a minor counter-trend correcting the first rally from 0.8671 to 0.8802 once this correction is complete near 0.8737 we expects a new impulsive rally through key-resistance at 0.8866 confirming that a new impulsive rally is developing for an ultimate break above the 0.9499 peak.

Ideally support at 0.8737 will be able to protect the downside, but a failure will bring support at 0.8721 into play as the barrier to the downside before higher again.

R3: 0.8866

R2: 0.8819

R1: 0.8792

Pivot: 0.8775

S1: 0.8752

S2: 0.8737

S3: 0.8721

Trading recommendation:

We are long EUR from 0.8765 with our stop placed at 0.8670

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

Elliott wave analysis of GBP/JPY for May 5, 2020

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We have seen a nice decline from the 135.45 peak, but key-support at 131.88 remains intact, so we can't say for sure, that the corrective rally from 123.99 has completed. It's however our preferred view and we expected more downside pressure after a minor counter-rally towards the 133.98 - 134.33 resistance-area. Once this resistance-area has been tested more downside pressure is expected through key-support at 131.88 to below 123.99 to complete the decline from 147.95.

R3: 135.45

R2: 134.27

R1: 133.40

Pivot: 132.64

S1: 132.35

S2: 131.88

S3: 131.10

Trading recommendation:

We will sell GBP at 134.10 or upon a break below 131.88

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

German's court to decide on participation in ECB programme

Signals for the EUR/USD pair:

A breakthrough at 1.0945 is likely to cause the euro to rise to the area of 1.0978 and 1.1013.

If the pair breaks through at 1.0895, it can lead to a sell-off of the euro at 1.0852 and 1.0819.

Signals for the GBP/USD pair:

If the pair breaks through at 1.2507, the British pound is likely to grow in the area of 1.2567 and 1.2638.

A breakthrough at 1.2441 may lead to a sell-off of the British pound at 1.2391 and 1.2347.

Fundamental data:

The following fundamental data is set for release during the day - the Eurozone Producer Price Index, the UK PMI, the US Balance of Trade, as well as the ISM manufacturing index for the US.

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

Technical Analysis of GBP/USD for 05/05/2020:

Technical Market Outlook:

The GBP/USD pair has made a local low at the level of 1.2406, just above the 61% Fibonacci retracement located at 1.2397. Any violation of this level will open the road towards the next target for bears seen at 1.2310. There is a short-term ascending trend line close to this level, so it might get tough for bears to violate it in one go. Please notice, the market is coming off the overbought levels and the momentum indicator is neutral, but when it turn south, then the sell-off might accelerate towards 1.2246 level.

Weekly Pivot Points:

WR3 - 1.2909

WR2 - 1.2757

WR1 - 1.2605

Weekly Pivot - 1.2476

WS1 - 1.2324

WS2 - 1.2200

WS3 - 1.2054

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 corona virus 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). The market might have done a Double Top pattern at the level of 1.2645, so the price might move lower in the longer-term.

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Technical Analysis of EUR/USD for 05/05/2020:

Technical Market Outlook:

After a Shooting Star candlestick pattern has been made at the top of the move, the EUR/USD market reversed back below the high and is currently trading below the technical support located at 1.0893. The momentum is still strong and positive, but the market conditions are overbought, so the odds for another dynamic wave up are decreasing. If the trend line gets violated, then the next technical support is seen at the level of 1.0878 and if broken, the sell-off might accelerate towards 1.0846.

Weekly Pivot Points:

WR3 - 1.1279

WR2 - 1.1141

WR1 - 1.1073

Weekly Pivot - 1.0940

WS1 - 1.0861

WS2 - 1.0728

WS3 - 1.0662

Trading Recommendations:

The fear of the coronavirus consequences is very strong among the global investors and this fear still rules on the financial markets. On the EUR/USD pair the main long term 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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GBP/USD: plan for the European session on May 5. COT reports indicate an increase in both long and short positions. Bears

To open long positions on GBP/USD, you need:

Yesterday, after several unsuccessful attempts to continue pushing the pound's decline from the 1.2441 level, the bears retreated from the idea of reaching a new low of 1.2391, and gave up the 1.2441 level, which is another headache. The Commitment of Traders (COT) reports for April 28 showed an increase in both long and short positions, but the latter turned out to be much more, which once again indicates the probability of continuing the bearish market phase, which formed on April 30. There are fewer people willing to buy the pound at such high prices. According to the data, during the reporting week, there was an increase in short non-commercial positions from the level of 30,907 to the level of 38,147, while long non-commercial positions grew only from the level of 29,527 to 31,466. As a result, the non-commercial net position became even more negative and ended up at -6,681, against -1,381, which indicates a tipping point and a real resumption of the downward trend for the pound in the short term. As for the intraday situation, the bulls need to form a false breakout in the support area of 1.2441 today, which they were able to during the Asian session. This scenario will lead to a larger upward correction to the high of 1.2507, just below which the moving averages pass. A more important task for buyers of GBP/USD will be to break through and consolidate at this level, which will necessarily lead to an update of the resistance of 1.2567, where I recommend taking profits. However, if there is no activity in the support area of 1.2441 after the weak PMI report for the UK services sector, it is best to postpone long positions until the update of the low of 1.2391, but I recommend buying the pair immediately for a rebound only after testing the area of 1.2300. Do not forget that while trading is above 1.2441, the bulls still have a chance to save the upward trend that formed on April 21.

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To open short positions on GBP/USD, you need:

Sellers have an equally difficult task, since a breakout is required to resume the downward trend and consolidate below the support of 1.2441, on which a lot depends. However, as I noted above, the market is on the side of sellers, so we can expect a more confident return of control and the pound to decline further. A break of 1.2441 will probably lead to a rapid decline in the GBP/USD to the support area of 1.2391, and the sellers' long-term goal will be the low of 1.2347, where I recommend taking profits. Poor data on the state of the UK services sector will only increase the pressure on the pair. In the growth scenario in the first half of the day, you can return to short positions on a false breakout from the resistance of 1.2507, but it is best to sell the pound immediately on a rebound from the high of 1.2567 based on a correction of 30-40 points within the day.

Signals of indicators:

Moving averages

Trade is carried out in the region of 30 and 50 moving average, which indicates an attempt to return the pair to their control by the bears.

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 in the area of 1.2410 will increase pressure by the pound. Growth above the upper border of the indicator in the area of 1.2465 will lead to a larger upward correction.

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

EUR/USD: plan for the European session on May 5. COT reports. Buyers reduce long positions, and traders await court order

To open long positions on EUR/USD, you need:

Yesterday, in my review for the second half of the day, I recommended opening short positions from the resistance of 1.0945, and paying attention to purchases only after updating the major support of 1.0895, which happened. The 5-minute chart clearly shows how buyers are trying to form a small upward correction after the test of the low of 1.0895, which continued during the Asian session. However, it is very early to talk about the return of buyers to the market. The Commitment of Traders (COT) reports for April 28 showed an increase in short positions, but also a decrease in long ones, indicating a desire to buy euros at current prices, as well as on the probability that the single currency will fall because of the crisis, which gradually erupted amid the coronavirus pandemic and the sharp reduction in macroeconomic indicators in the eurozone. The report shows an increase in short non-commercial positions from 83,160 to 87,583, while long non-commercial positions decreased from 170,378 to 167,264. As a result, the positive non-commercial net position slightly decreased to 79,681, against 87,128, indicating a decrease in interest in purchasing risky assets at current prices. As for the intraday strategy, it will be determined by today's ruling of the German constitutional court on the legitimacy of the Bundesbank's participation in the European Central Bank's asset purchase program. If the bulls manage to form a false breakout in the resistance area of 1.0895, it is likely that demand for the euro will return, which will lead to a larger upward correction to the highest area of 1.0945. However, a more important task will be the 1.0978 resistance test, where I recommend taking profits. If there is no activity at the 1.0895 level, it is best to postpone long positions until the decline to the larger support area of 1.0852, from where you can open long positions immediately for a rebound based on 25-30 points of correction within the day.

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To open short positions on EUR/USD you need:

Bears will wait for the decision of the German court, and if it's not in favor of market expectations, it is likely that a breakout and consolidation below the support of 1.0895 will quickly push the European currency to new lows in the area of 1.0852 and 1.0819, where I recommend taking profits. More persistent sellers will expect to test the lows of 1.0787 and 1.0755. In case EUR/USD grows in the first half of the day, I recommend paying attention to short positions only after forming a false breakout in the resistance area of 1.0945, since data on eurozone producer prices, the release of which is planned during the European session, is unlikely to seriously affect the market. I recommend selling the euro immediately on a rebound only from the more significant highs of 1.0978 and 1.1013, but do not forget about the court decision, which can provoke more powerful purchases of EUR/USD, which will lead to a reversal of the downward correction and return the pair to a bullish trend.

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Signals of indicators:

Moving averages

Trading is below 30 and 50 moving averages, which indicates an attempt by the bears to return to the 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 1.0875 increases pressure on the European currency. In case of an upward correction, the upper border of the indicator in the area of 1.0945 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.
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Technical Analysis of BTC/USD for 05/05/2020:

Crypto Industry News:

The crypto market Paxful announced today the extension of its charity initiative in Africa, with the launch of Fund for Africa, which is to allocate donations in Bitcoin to purchase the necessary resources to fight the coronavirus pandemic.

As announced, the number of COVID-19 cases in Africa is increasing. The purpose of collecting funds is to purchase personal protective equipment, food and to provide people with so-called high risk of infection, food and handwashing stations.

Cryptocurrencies have so far been an obstacle when it comes to fundraising and charity activities during the coronavirus crisis. Humanitarian organizations will support the LAO campaign, such as Zam Zam Water, which provides access to clean water and builds schools in villages around the world.

The COVID-19 crisis has mobilized a cryptographic community around the world to join charity initiatives. It is worth mentioning here the initiative to raise money in cryptocurrencies for the Italian Red Cross, which tripled the initial goal of the campaign of about $ 10,000 in less than four weeks, which allowed them to build medical facilities to fight COVID-19 in this country.

Technical Market Outlook:

The BTC/USD pair has broken through the trend line resistance located around the level of $8,819 and is heading towards the next technical resistance at $9,123. Nevertheless, the key level of support is still seen at $8,357. Any violation of this level will deepen the correction towards the level of $7,934 which is a key short-term technical support for the price. Weak and negative momentum supports the short-term bearish outlook.

Weekly Pivot Points:

WR3 - $11,425

WR2 - $10,480

WR1 - $9,720

Weekly Pivot - $8,578

WS1 - $7,824

WS2 - $6,750

WS3 - $5,970

Trading Recommendations:

The recent rally in Bitcoin was made in anticipation of Bitcoin halving and it is a classic pump and dump scheme. 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 until the level of $10,791 is clearly violated.

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Technical Analysis of ETH/USD for 05/05/2020:

Crypto Industry News:

The number of Ethereum blocks has just reached 10 million. This is a significant milestone for the world's second cryptocurrency in terms of market capitalization.

According to Luit Hollander, the Ethereum network needed over 15 ZH computing power to extract this huge number of blocks in five years. We remind you that the genesis block of the largest altcoin was mined on July 20, 2015.

Hollander writes:

"A noticeable number of forks appeared on our way to this milestone. Although the forks always divide the chain, the old chain is often abandoned, which is why they are sometimes called "network updates".

10,000,000 Ethereum blocks is an achievement on the eve of the release of Ethereum 2.0. The transition to cryptocurrency to PoS (update referred to as Serenity) is expected to begin in July with the launch of Beacon Chain.

Technical Market Outlook:

The bears at ETH/USD pair has manage to push the price towards 38% Fibonacci retracement located at the level of $195.94. Moreover, the short-term trend line support has been violated as well and the price is testing the technical support at the level of $193.78.Nevertheless, the price bounced from lows seen at the level of $193.78 and is currently trying to test the trend line from below. The weak and negative momentum supports the short term outlook towards the next support located at $188.86 or even towards 50% retracement at $186.72.

Weekly Pivot Points:

WR3 - $296.61

WR2 - $243.36

WR1 - $224.05

Weekly Pivot - $205.69

WS1 - $188.49

WS2 - $168.64

WS3 - $150.80

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 $288 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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USDCAD reacting below descending trendline resistance!

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Trading Recommendation

Entry: 1.40920

Reason for Entry: descending trendline resistance, 38.2% Fibonacci retracement

Take Profit : 1.39588

Reason for Take Profit: 61.8% Fibonacci retracement

Stop Loss: 1.41525

Reason for Stop loss: Graphical swing high

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Forecast for AUD/USD on May 5, 2020

AUD/USD

The Australian dollar worked out the support for the nearest line of the price channel and reflected from it, forming a correction from the fall since April 30. The divergence on the Marlin oscillator continues to act, we expect the price to fall.

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The first target of the bears is the MACD line at around 0.6270. The second target is determined by the embedded line of the price channel of 0.6150.

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The price has overcome the resistance of the MACD line on the four-hour chart, but the signal line of the Marlin oscillator located in the negative trend zone retains high chances of the price to turn above the MACD line. A direct signal for opening sales is when the price leaves the Monday low of 0.6374.

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Forecast for USD/JPY on May 5, 2020

USD/JPY

The USD/JPY quote once again approached the support of the embedded line of the price channel on Monday and the price went under it again this morning. Most likely, this downward movement is working, since tomorrow's candlestick will coincide with the 9th line of the Fibonacci time zone and will receive a strong acceleration down. The immediate goal of the yen is the 105.10 level, behind it is the 103.95 level.

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The price has consolidated below the MACD line on the H4 chart, the Marlin oscillator has penetrated into the zone of negative values, into the bearish zone. We are waiting for the falling sentiment on the USD/JPY to proceed further. On the practical side, it is possible to open short positions at current prices with a stop loss of 107.15.

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Overview of the GBP/USD pair. May 5. The UK is calling on countries around the world to join forces to create a vaccine against

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - downward.

Lower linear regression channel: direction - sideways.

Moving average (20; smoothed) - sideways.

CCI: -58.7810

The British pound started the new trading week with consolidation below the moving average line. Thus, the trend has changed to a downward one and short positions are now relevant. There was no major news from the UK on Monday. We can only note the fact that the rate of spread of "coronavirus" in the Nebula remains quite high. However, traders are now more interested in the technical picture and the overall geopolitical situation in the world. We believe that China and the United States are on the verge of a new conflict, which this time may not just be a trade conflict. Accordingly, we can expect anything from these two countries now. And the demand for the US dollar is growing at the beginning of the week, as traders flee from risky assets.

The spread of "coronavirus" disease in the UK, if it is decreasing, then at a very low rate. Over the past day, 4,339 new cases of infection were recorded, which is only a few hundred less than the day before. Now the UK is "chasing" Italy and Spain, where 211,000 and 217,000 cases of "coronavirus" have been recorded, but in both these countries there is a decrease in the growth rate of disease, and quarantine measures are beginning to weaken. Thus, until May 26, when, according to preliminary information, London will begin to relax measures in the Foggy Albion, Britain can reach the net second place in the world for infection with the "Chinese infection". This is the price for not taking the epidemic seriously. By the way, the closest friend of the ruler of Great Britain Boris Johnson - Donald trump - leads the country, which is in first place in the world in terms of mortality and morbidity of "coronavirus". It is not surprising that in such circumstances, London is most interested in creating a vaccine as quickly as possible. Prime Minister Johnson considers this an issue of global significance and calls on all countries of the world to unite. "To win the battle against the virus, we need to work together to create an invulnerable shield that protects citizens. This can only be achieved by producing the vaccine on an industrial scale. The faster we join forces and share our experience, the faster scientists will succeed. The race to create a vaccine to fight this virus is not a competition between countries, but the most important task of our lives. We are talking about the confrontation between humanity and the virus, this is a common problem of all mankind, and together we will win," Johnson said.

It is reported that the UK is ready to invest about 388 million pounds to fight the COVID-2019 virus. This money will have to go to purchase and conduct tests, as well as to develop a vaccine. A so-called donor conference will be held today to raise about 7.5 billion euros to provide every corner of the world with a vaccine that will be sold at affordable and fair prices. At least, this is what the head of the European Commission, Ursula von der Leyen, said. The conference will be attended by the Melinda and Bill Gates Foundation, WHO, and various other charitable foundations and organizations. The event is also supported by the top officials of Germany, France, and Italy - Angela Merkel, Emmanuel Macron, and Giuseppe Conte.

On the second trading day of the week, only one macroeconomic report is planned in the UK – business activity in the service sector, which has a "smart" forecast of 12.3. Similar indicators will be released in the afternoon in the United States. We believe that all these three reports will be ignored by traders, as these figures are not particularly important for the UK economy or the US economy at the moment. An absolutely true proposition that the "coronavirus" will not be able to win any business activity or economic activity will not grow. Therefore, the goals of the health sector are now in the first place. And these goals are the same for the whole world. All the most interesting things for the British pound are planned for the second half of the week. That is when the Bank of England will hold a meeting, after summing up the results of which traders will be able to draw new conclusions. In the meantime, the situation in the currency market remains calm, and participants are more interested in the general fundamental background, which does not have a special impact on the market.

The technical picture, as we have said many times before, remains the most important for analyzing and predicting the movement of the pound/dollar currency pair. On Monday, the pair's quotes were fixed below the moving average line, so the trend is now changed to a downward one. If we do not take into account the quarantine, the crisis, and the epidemic, we would say that the upward trend that began on March 20 is over. This is evidenced by a fairly large number of technical factors, the most important of which is the rebound from the Murray level of "7/8"-1.2634 twice. However, after the end of one trend, we often wait for the beginning of another. At this time, the downward trend may not start. On the weekend for the euro/dollar pair, we assumed that the quotes still began to consolidate, but not in a narrow channel, but in a fairly wide one (about 250 points). Approximately the same pattern can be observed for GBP/USD in the coming weeks, and the side channel is already clearly visible. It can be limited by the level of 1.2637 from above and by the area of 1.2207-1.2265 from below. Thus, its width will be about 400 points, but in the future, the channel may narrow. The main reason for the possible absence of a trend in the near future is the lack of support for one of the currencies by the macroeconomic or fundamental background, as well as the lack of panic in the market when both backgrounds do not matter at all. Therefore, we cannot now conclude that the US dollar or, conversely, the pound will become more expensive. The lower channel of linear regression has turned sideways, which already indicates that there is no trend in the medium term. In general, we would recommend that traders do not expect strong growth of any currency in the near future.

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The average volatility of the GBP/USD pair has started to decline again and is currently 125 points. For the pound, this is not too much. The main thing is not to start a new trend of increasing volatility, which may mean a new panic in the market. On Tuesday, May 5, we expect movement inside the channel, limited by the levels of 1.2315 and 1.2565. A reversal of the Heiken Ashi indicator upward will indicate a round of an already ascending correction.

Nearest support levels:

S1 – 1.2390

S2 – 1.2329

S3 – 1.2268

Nearest resistance levels:

R1 – 1.2451

R2 – 1.2512

R3 – 1.2573

Trading recommendations:

The GBP/USD pair continues to move down on the 4-hour timeframe. Thus, traders are now recommended to sell the pound with the goals of 1.2390 and 1.2329 and keep the shorts open until the Heiken Ashi indicator turns upward. It is recommended to buy the pound/dollar pair again not earlier than the reverse price fixing above the moving average with the first goals of 1.2512 and 1.2565.

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

Overview of the EUR/USD pair. May 5. US intelligence agencies have found evidence of China's guilt before the world public.

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: 10.4497

The EUR/USD currency pair starts in a downward correction on Tuesday, May 5. The day before, the euro/dollar pair worked out the moving average line, so it keeps the chances of resuming the upward movement. However, we believe that after overcoming the moving average, the pair will rush to the Murray level of "0/8"-1.0742, which is also the lower border of the side channel. We also note that the lower channel of linear regression is directed sideways, while the higher channel turns down, which also increases the probability of overcoming the moving average line. Also, the US dollar may be in demand due to the heat of passions between China and the US, and in such cases, the US currency is often in demand as the most secure, according to investors and traders.

Meanwhile, the United States led by Donald Trump, who already feels that the chances of winning the election in November 2020 are rapidly falling, continue to "investigate" the leak of "coronavirus" from a Chinese laboratory in Wuhan. We deliberately put the word "investigation" in quotation marks, because in fact, no ordinary citizen can say with certainty whether there is any investigation at all. The White House can say anything and show no evidence of it. In fact, in most cases, Donald Trump and his supporters do so. Thus, we have little doubt that Washington will find evidence of anything in China. It is clear that the whole world, including the United States, is suffering from the "Chinese" pandemic. Even if the virus broke free completely by accident and there was no malicious intent or deliberate concealment of the facts on the part of Beijing, in any case, China is to blame for the leak of the infection, due to which the whole world is now suffering. Therefore, it is also possible to understand all the countries of the world that are now making claims to the Chinese side. The economies of all countries have suffered, and a series of bankruptcies of airlines and oil companies is expected, not to mention small and medium-sized businesses. Thus, Washington has the right to make claims. And no one will ever know the truth. No one will ever know whether the virus escaped from the Wuhan laboratory by accident or whether it was deliberately spread, whether the Chinese rulers were hiding and are now hiding the real scale of infection and mortality? And the most important question is, what is the current situation with the pandemic in China? Despite the fact that China has done a great job in quarantining and localizing the virus, it is very difficult to believe that in recent months there have been no new cases of infection. And according to official information, this is exactly the case.

Donald Trump is considering the introduction of new sanctions and duties against China seriously. In one of the regular interviews that Trump gives out every day, he hinted that raising trade duties is one of the tools in negotiations with Beijing. "We all play a difficult game: chess or poker... It's not checkers, that's what I'll tell you," Trump said, hinting that China will be held accountable to the full extent of American laws. At the same time, the US special services conducted an investigation and concluded that China in early January really hid the scale of the epidemic and the high degree of contagion of the new virus in order to more easily purchase medical protection and necessary medicines. US intelligence agencies concluded that China reduced exports of some medical products in January and increased its imports while hiding and denying these facts.

In turn, Secretary of State Michael Pompeo said that China deliberately misinformed the West. "This is a classic attempt at Communist disinformation," Mr. Pompeo said. "Beijing has done everything possible to prevent Western countries from learning in time about the true scale of the epidemic, or about the health threat posed by coronavirus infection." Pompeo also said that China has denied the West access to American doctors and specialists to the data and location of the new virus. So they're not going to cooperate. Thus, whether it is true or not, the United States already formally have the evidence on their hands. Now it is the turn for sanctions or, more simply, retaliatory actions. From our point of view, relations between China and the United States are now becoming complicated many times. If China's economy has already begun to recover from the quarantine and epidemic, the US economy continues to fall and will begin to recover at best in the third quarter. Thus, the American economy will lose much more than the Chinese one. Considering the fact that before this, two years trade negotiations between Beijing and Washington were held, which, according to many experts, were primarily beneficial to America, China delivered a good retaliatory strike, though not only in the United States, but around the world.

Based on all the above, we believe that as soon as the "coronavirus" epidemic ends, and it is still very early to talk about it, a new battle will begin, which may affect the most developed countries of the world. It will be called "confrontation with China". Especially if there is no second wave of the epidemic in the Middle Kingdom. Especially if the total loss of the economy in China is much smaller than that of their main competitors. It is possible that China will fall into an economic blockade if it does not want to voluntarily "pay damages" for its negligence or criminal negligence. Thus, unfortunately, the world economy is unlikely to return to a state of rest in the near future.

On Tuesday, May 5, the European Union is scheduled to publish an economic growth forecast - a summary of forecasts for key economic indicators. And in the United States on this day, the publication of business activity indices in the service sector according to the Markit and ISM versions is planned. The service sector is expected to decline from 52.5 to 32 points in May according to ISM and 27 points according to Markit. However, from our point of view, these figures do not matter now. They are in any case talking about the strongest decline in the service sector. Thus, we believe that market participants will ignore them, which means that today will again be empty in terms of the macroeconomic background. News, as always, should be expected from Donald Trump and from America in general. And technical factors will remain in the first place in terms of the degree of influence on the currency market.

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The volatility of the euro/dollar currency pair as of May 5 is 91 points. Thus, the indicator remains average in strength, close to high, and there is still no reason to expect a new wave of panic. Today, we expect quotes to move between the levels of 1.0818 and 1.1000. A reversal of the Heiken Ashi indicator upward may signal the end of a downward 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 to be adjusted. Thus, traders are advised to open new purchases of Eurocurrency with targets at levels of 1.0986 and 1.1000, but only in case of a price rebound from moving. It is recommended to consider selling the euro/dollar pair no earlier than fixing the price below the moving average line with targets at 1.0818 and 1.0742.

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