Technical Analysis of BTC/USD for June 5, 2020:

Crypto Industry News:

The latest Bloomberg report reveals that the company expects Bitcoin to re-test its 2017 record results, and that it could even reach $ 28,000.

The report suggests that COVID-19 has accelerated Bitcoin's maturation as an asset, showing its strength among declining stocks. In addition, it indicates the ever-growing appetite of institutional investors, in particular Grayscale or GBTC, which consumes about 25% of new supply. The constantly falling premium in GBTC despite strong influences indicates that supply is removed from the market and maturing. Based on an average 30-day premium of 20% on the holding fund relative to the underlying net asset value, it is comparable to a historical average of 39%.

The report says that "something must go really bad" so that Bitcoin does not grow. He then states that he will reach the highest level of $ 20,000 in 2017, and that he may even reach the new highest level of $ 28,000.

According to the report, another important reason is the rapid growth of Tether. In May, its market capitalization amounted to USD 4 billion. A year later it increased to 10 billion dollars. The increase in the circulation of stablecoins indicates a greater acceptance of cryptographic assets.

After halving and almost half of 2020, we should not wait long to see if the forecasts will come true.

Technical Market Outlook:

The BTC/USD pair has been consolidating the recent gains around the level of $9,700 after the bounce form the trend line dynamic support. The momentum is now neutral, so any clear violation of the level of $9,249 will accelerate the drop towards the next technical support located at the level of $8,565. The daily time frame trend remains up.

Weekly Pivot Points:

WR3 - $11,128

WR2 - $10,392

WR1 - $9,960

Weekly Pivot - $9,277

WS1 - $8,866

WS2 - $8,158

WS3 - $7,756

Trading Recommendations:

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. The key mid-term technical support is located at the level of $7,897.

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GOLD Double Bottom Ahead NFP!

The gold price is located in the buyer's territory, the outlook is still bullish ahead of the crucial US data. Gold is trading at $1,711 level and is fighting hard to stay above the $1,700 psychological level and to accumulate more bullish energy before it resumes its upside journey.

The US Non-Farm Employment Change is expected around -7,750K today, better versus the -20,537K in the previous month, but unfortunately, the Unemployment Rate could increase from 14.7% to 19.4% in May. The Average Hourly Earnings could grow by 1.0%. The figures will bring high volatility, the gold price could accelerate its rally if the readings come in worse than expected.

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The price action has developed a potential Double Bottom on the H4 chart, but this pattern is far from being confirmed. Gold has found strong support right on the $1,700 level again, the false breakdown has attracted more buyers.

The price could come back towards the $1,700 level after the rejection from the PP ($1,720) level, another rejection or false breakdown below the $1,700 - $1,693 area will suggest buying. The potential double bottom pattern will be validated only after a valid breakout above the upper median line (UML) and above the $1,746 when the price makes another higher high.

Gold could develop a minor triangle as well in the short term, between the upper median line (UML) and the $1,700 - $1,693 area, a valid breakout from this potential pattern will give us a clear direction and a fresh trading signal.

  • GOLD Trading Tips

Gold is bullish as long as it stays above the $1,693 - $1,700 zone, a valid breakdown below this support area could send the price towards the median line (ML), the price could develop a broader corrective phase if the price reaches the median line (ML) and if it closes on it.

If the price stays above the $1,700 - $1,693 area and if it fails to approach and reach the median line (ML), another leg higher is expected. A larger increase will be validated by a valid breakout above the upper median line (UML) of the descending pitchfork and above the R1 ($1,746) level.

Long above the $1,746 level with near-term targets at R2 ($1,764), R3 ($1,790), and higher at the $1,800 psychological level. If you want to sell gold, maybe you should wait for a valid breakdown below the median line (ML) and below the $1,666 static support to be sure that the price will register a major drop towards $1,600, $1,555, and $1,484 levels.

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Technical Analysis of GBP/USD for June 5, 2020:

Technical Market Outlook:

The GBP/USD pair has made a new local high at the level of 1.2656 (at the time of writing the article)and is getting away from the upper channel line. The nearest support is seen at the level of 1.2580 and the next target for bulls is seen at the level of 1.2747. It is worth to notice, that if the level of 1.2485 is violated, then GBP/USD has made an overbalance of price, so the odds for another wave down are higher. The last swing low and technical support is seen at the level of 1.2072, but there is still a long way to test this level of support.

Weekly Pivot Points:

WR3 - 1.2667

WR2 - 1.2540

WR1 - 1.2455

Weekly Pivot - 1.2311

WS1 - 1.2222

WS2 - 1.2062

WS3 - 1.2001

Trading Recommendations:

On the GBP/USD pair the main trend is down, but the local up trend continues. 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 these 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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NZDJPY holding below long term descending trendline!

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Trading Recommendation

Entry: 71.346

Reason for Entry: Descending trendline resistance

Take Profit : 66.240

Reason for Take Profit: 61.8% Fibonacci retracement, Graphical overlap

Stop Loss: 72.426

Reason for Stop loss: -27.2% Fibonacci retracement

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USDCAD testing downside confirmation, further downside !

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Trading Recommendation

Entry:1.3525

Reason for Entry: 100% fibonacci extension

Take Profit :1.3316

Reason for Take Profit: 168% fibonacci extension

Stop Loss: 1.3695

Reason for Stop loss:

38% fibonacci retracement

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EUR/AUD testing support, potential bounce

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Trading Recommendation

Entry: 1.62946

Reason for Entry: horizontal overlap support and 38.2% fibonacci retracement

Take Profit: 1.64748

Reason for Take Profit: Horizontal overlap resistance, 61.8% fibonacci retracement

Stop Loss: 1.62171

Reason for Take Profit: horizontal swing low support, 61.8% fibonacci retracement

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Technical Analysis of EUR/USD for June 5, 2020:

Technical Market Outlook:

The EUR/USD pair has hit the level of 1.1361 and there is no sign of a trend reversal so far. Nevertheless, please notice, the market conditions are now extremely overbought and despite the positive and strong momentum the price might start a corrective pull-back towards the nearest technical support located at the level of 1.1236. Any violation of this level would indicated a deeper move down towards the level of 1.1190. The daily time frame trend remains up.

Weekly Pivot Points:

WR3 - 1.1499

WR2 - 1.1307

WR1 - 1.1241

Weekly Pivot - 1.1045

WS1 - 1.0959

WS2 - 1.0772

WS3 - 1.0680

Trading Recommendations:

On the EUR/USD pair the main long term trend is down, but the local up trend continues. 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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EUR/USD high and low June 05, 2020

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The intraday high and low from the Central Bank Dealer Range (CBDR) usually form at STDV 2-STDV 4 in the normal condition market. Sometimes it can reach the STDV 5-STDV 6 level during the high volatility in the market. Here are today's levels:

STDV 10 - 1.1495.

STDV 9 - 1.1480.

STDV 8 - 1.1465.

STDV 7 - 1.1450.

STDV 6 - 1.1435.

STDV 5 - 1.1420.

STDV 4 - 1.1405.

STDV 3 - 1.1390.

STDV 2 - 1.1375.

STDV 1 - 1.1360.

CBDR - 1.1345.

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

CBDR - 1.1330.

STDV 1 - 1.1315.

STDV 2 - 1.1300.

STDV 3 - 1.1285.

STDV 4 - 1.1270.

STDV 5 - 1.1255.

STDV 6 - 1.1240.

STDV 7 - 1.1225.

STDV 8 - 1.1210.

STDV 9 - 1.1195.

STDV 10 - 1.1180.

Pay attention to the level between today's & yesterday range at 1.1255, 1.1345 & the previous day high 1.1362 with the previous day low 1.1195.

(Disclaimer)

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EUR/USD: plan for the European session on June 5 (analysis of yesterday's deals). ECB gives out generous gifts, and euro

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

I think a lot of people already know that yesterday, the European regulator increased the emergency program for the purchase of PEPP assets by 600 billion euros, which led to such a strong increase in the euro in the short term. If you look at the 5-minute chart, you will see how returning to resistance 1.1254 and consolidating above this level during European Central Bank Preside Christine Lagarde's speech formed a good signal for buying the euro for those who did not manage to do this from support at 1.1195 in the morning, where I also advise you to open long positions. As a result, a powerful bullish momentum led to renewing the high of 1.1344, which is now transformed into resistance at 1.1358. Euro buyers are significantly aiming for this level, since a break and consolidation in this range will keep EUR/USD attractive and will result in strengthening towards highs 1.1422 and 1.1459, where I recommend taking profits. However, we should not forget that data on the state of the US labor market will be released closer to the afternoon, which will surely become a "cold shower" for speculative buyers. In case the pair falls in the morning, you can count on purchases after a correction to the support area of 1.1274, provided that there is a false breakout there. There are moving averages, which will provide additional support to the pair. I advise you to open long positions immediately for a rebound only after testing the low of 1.1195. New COT reports for the week will published today, in which we can expect an increase in long non-profit positions. Let me remind you that there was a fairly intensive growth in long positions last week, which jumped from 167,756 to 175,034. As a result, the positive non-profit net position also increased and amounted to 75,222 against 72,562, which indicates an increase in interest in buying risky assets.

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

So far, sellers are being quite cautious and, judging by the situation, will only return to the market if they have very good data on the number of people employed in the non-agricultural sector of the United States, as well as the unemployment rate. All of these reports should be better than economists had forecasted in order for the US dollar demand to return. The key task of the bears in the first half of the day will be to form a false breakout in the resistance area of 1.1358, which will lead to a downward correction of EUR/USD to the support area of 1.1274, where I recommend taking profits, since a break below this level without good support for fundamental data will be very problematic. Bears will further aim for 1.1195. If the upward trend in EUR/USD continues, and most likely it will be so, then after breaking through resistance 1.1358, I advise you to consider new short positions only after updating resistance 1.1422 or selling the euro immediately for a rebound from a high of 1.1459 with the aim of a downward correction of 30- 40 points within the day.

Signals of indicators:

Moving averages

Trading is above 30 and 50 moving averages, which indicates the continuation of the bull 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

The euro's growth may be limited by the upper level of the indicator at 1.1395. In case the pair falls, support will be provided by the lower border of the indicator in the region of 1.1245.

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 the short and long positions of non-profit traders.
The material has been provided by InstaForex Company - www.instaforex.com

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

The pair traded upwards on Thursday and almost tested 1.1371 - an 85.4% pullback level (presented in a blue dotted line). The news played an important role in such a strong upward movement. Today, the price may roll back down after testing the resistance line. Economic calendar news for the dollar is expected at 12:30 UTC.

Trend analysis (Fig. 1).

Today, the upward trend may continue from the level of 1.1340 (closing of yesterday's candle) with the target at resistance line 1.1380 (presented in a white bold line). The historical resistance level 1.1382 (presented in a blue dashed line) is also located there. It is very likely that from this cloud, the price may begin to move downwards with the first target of 1.1270 - a 14.6% 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 - down;

- Bollinger Lines - down;

- Weekly schedule - up.

General conclusion:

Today, the price may continue to move upwards with the target at the resistance line 1.1380 (presented in a white bold line). From this level, the price may begin to move downwards with the first target of 1.1270 - a 14.6% retracement level (presented in a red dashed line).

Another possible scenario is an upward trend after breaking through the resistance line 1.1380 (presented in a white bold line) with the target at the upper fractal 1.1498 (presented in a blue dashed line).

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Elliott wave analysis of EUR/JPY for June 5, 2020

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Red wave iv/ came through a super small correction only stretching from the 122.62 high to a low at 121.81 before powering ahead towards the ideal red wave v/ and black wave iii target at 124.26. Once black wave iii is completed at 124.26 we should expect a complex flat correction in black wave iv with the ideal target set close to 121.81.

In the short-term, a break below minor support at 123.26 will indicate that black wave iii has completed and the correction in black wave iv is in motion.

R3: 124.70

R2: 124.26

R1: 123.90

Pivot: 123.55

S1: 123.26

S2: 122.78

S3: 121.81

Trading recommendation:

We will sell 50% of our normal EUR position at 124.20 and place our stop at 125.00. We will take profit and re-buy EUR at 122.00

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

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After a very small red wave iv/ correction to 135.93, GBP/JPY is heading towards the ideal target for red wave v/ and iii at 139.07. Once red wave v/ and iii is completed, we can expect another minor correction in red wave iv close to support at 135.93 before the final rally higher in red wave v.

However, for now, the pair is likely to test 139.07. Support is seen at 137.16.

R3: 139.07

R2: 138.58

R1: 137.80

Pivot: 137.16

S1: 136.89

S2: 136.32

S3: 135.93

Trading recommendation:

We are long GBP from 131.95 and we will move our stop higher to 135.05

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GBP/USD: plan for the European session on June 5 (analysis of yesterday's deals). Bulls returned to the market and are set

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

The British pound strengthened yesterday following the European currency and returned to its weekly highs, testing them again. But it was not possible to break through this range. As for yesterday's deals, if you look at the 5-minute chart, you will see that in the afternoon you could and should have bought the pound after returning to the level of 1.2552, which I mentioned in my review for the afternoon. This led to a good bullish momentum, but failed to go above the highs of the week, although there were attempts. It is not surprising that bears are protecting this resistance, since so much depends on it. As for the short-term technical picture of the pound, the bulls are focused on a break of resistance at 1.2611, consolidating on it can result in the pair's growth in the area of highs 1.2686 and 1.2744, where I recommend taking profits. Also, do not forget about how buyers are retaining support at 1.2552, where the moving averages are taking place, since forming a false breakout on it will be a signal to open long positions while expecting the bullish trend to continue. If the pair falls below this level, it is best to wait until the low of 1.2500 is updated or buy GBP/USD immediately to rebound from the larger level of 1.2439, where buyers will try to form a new lower border for the ascending channel. Today we will receive new data on COT reports, which may indicate a change in the balance of power in the market. Let me remind you that in the previous COT report, short non-commercial positions increased from 54,799 to 61,449, while long non-commercial positions also increased from 35,810 to 39,192. As a result, the non-profit net position became more negative and was at the level of -22,257 against -18,989, which so far keeps GBP/USD in the medium-term bearish trend.

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

Sellers act with caution, since the pound's growth is more connected with the dollar's weakness due to America's unrest, than with sterling's strength itself. Considering that important data on the US labor market will be released today, pressure on the British pound may return, provided that the reports turn out to be better than forecasts of economists. Bears need to form a false breakout in the resistance area of 1.2611, which will be an ideal signal to open short positions in the pair. This option will be able to return GBP/USD to 1.2552 support, a breakthrough of which will be a very important event for the current short-term outlook. A move below 1.2552 will force many speculative buyers to close long positions, which will lead to selling GBP/USD to the low of 1.2500 and 1.2439, where I recommend taking profits. However, updating these supports will only be considered as a correctional movement within the upward trend of May 18. In case the pound grows further, it is best to return to short positions only after updating resistance 1.2686 or even higher - from a high of 1.2744 while aiming for a downward movement of 30-35 points to end the day.

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Signals of indicators:

Moving averages

Trading is above 30 and 50 moving averages, which indicates another attempt by the bulls to build a new momentum.

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 upper border of the indicator at 1.2630 will lead to a new wave of pound growth. In case the pair falls, support will be provided by the lower border at 1.2540.

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 the short and long positions of non-profit traders.
The material has been provided by InstaForex Company - www.instaforex.com

Forecast for EUR/USD on June 5, 2020

EUR/USD

Yesterday's main event was the European Central Bank meeting at which it announced the expansion of the QE program - the volume of repurchased assets on the regulator's balance sheet was increased by 600 billion euros, that is, in total from the first program to 1.35 trillion euros. Asset purchases will continue for exactly one year. The euro rose by 104 points, although it would have been more understandable to pull it down on the monetary factor itself. The ongoing growth, of course, involves the psychological nature of investors who are waiting every day for any news on the recovery of the economy.

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So, the euro has fulfilled the previously identified target of 1.1342. The euro has grown by 250 points since the beginning of the week and now investors can close speculative purchases, especially at the end of the week. The best reason for this could be today's data on employment in the United States. Data for May regarding new jobs in the non-agricultural sector are expected at -7.75 million, the general unemployment rate is projected to increase from 14.7% to 19.4%. Previous employment indicators tell us that today's data will be better than forecasts.

Our main scenario assumes a reversal of the euro with a subsequent decrease to 1.1130 - to the embedded line of the price channel of the monthly timeframe, similar to the one that occurred on March 10.

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A weak divergence formed on the four-hour chart for Marlin. But it could be enough for an actual reversal signal. There are two supports on the euro's path to the 1.1130 goal: 1.1265, 1.1200.

An alternative option involves continued growth in risk appetites. In this case, the target opens at 1.1415 after overcoming yesterday's high, then it can be followed by taking 1.1495, which is the March 9 high.

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Forecast for AUD/USD on June 5, 2020

AUD/USD

The Australian dollar made a mark at the target level of 0.6975 on Thursday. The Marlin divergence remains undisturbed. A price reversal from current levels is more likely. The first target of the decline is the level of 0.6830, followed by 0.6680.

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The signal line of the Marlin oscillator on the four-hour chart is rapidly approaching the border of the declining trend territory, despite yesterday's price increase. It even looks like divergence.

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The MACD line is approaching the first target level of 0.6830, which will strengthen this level and, accordingly, help the price overcome this level, fuelling a further decline. Price taking above 0.6976 opens an alternative short-term scenario with the price rising to 0.7080.

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Forecast for USD/JPY on June 5, 2020

USD/JPY

The dollar continued to grow against the yen yesterday (23 percentage points) despite the decline in stock indices: the S&P 500 was down -0.34%, while the Nikkei 225 is losing -0.32% in the Asian session today. It seems that investors are counting on good US employment data today and continued growth in related markets. If such expectations are met, then with the price overcoming the first target level of 109.50, growth will continue to the second target level of 110.83 (November 2017 low).

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A weak divergence has formed on the Marlin oscillator on the four-hour chart, the structure is more similar to the indicator discharging before further growth. But this pattern is also a harbinger of increased intraday volatility, which is quite consistent with today's release of important US data.

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We are waiting for a clarification of the situation - whether investors will change their minds to buy risk.

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Overview of the GBP/USD pair. June 5. Donald Trump was not supported by former US presidents, the head of the Pentagon, and

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - upward.

Lower linear regression channel: direction - upward.

Moving average (20; smoothed) - upward.

CCI: 97.1724

The British pound on Thursday corrected slightly more strongly than the European currency, however, in the afternoon, it resumed the upward movement. At the same time, as we have already noted in the article on EUR/USD, the main events of the past day – the ECB meeting, Christine Lagarde's speech – had nothing to do with the GBP/USD pair. However, in the US trading session, market participants still started selling the dollar again, not even reaching the moving average line, which was the most obvious target for correction. Thus, the mood of the market participant remains the same, but the reasons are becoming more ambiguous every day.

To begin with, many US officials have criticized Donald Trump for his desire to suppress rallies and protests as harshly and quickly as possible. Yes, in some cities, the Americans demolished several shops and police stations, but these are the cases that the police should deal with. Most of the protests and rallies are peaceful. Thus, they have nothing to disperse, and even more so there is no reason to resort to the US army for help. Thus, Trump's intentions and desires were again regarded as an abuse of power. Most of the US governors refused to strictly suppress the rallies, which forced Trump to call them "fools" and many other unflattering epithets. And what attitude should the country have towards a president who does not respect the rights of his population or other high-ranking officials? For example, the former US defense secretary James Mattis, who was fired by Donald Trump in 2018, believes that Trump is "the first head of state who does not even try to unite the nation." "He doesn't even pretend to try. On the contrary, it tries to divide us. Now we are seeing the consequences of his targeted efforts in this area over the past three years," Mattis said. Former US presidents Barack Obama, George W. Bush, Bill Clinton, and Jimmy Carter also supported Mattis' opinion. The fact that Trump is going to use the "Insurrection Act" of 1807 is criticized by everyone who follows the events. "It was impossible to imagine that our troops would ever be ordered to violate the constitutional right of their citizens," the former defense minister said. Thus, in fact, Trump wants to disperse the protesters by any means so that the country can return to normal life as soon as possible and begin to restore the economy after the "coronavirus" pandemic. It was clearly not part of his plan that there would be a public revolt that would hit his political ratings even harder. Recall that according to the latest information, the level of support and approval of Trump is inferior to Biden by 8-10%. Thus, the American president really has a low chance of re-election, given all the events of the past three months. But this is not yet the beginning of a new escalation of the trade conflict with China. Recall that China is seriously considering canceling the deal reached on January 15. If this happens, then all of Trump's efforts in the confrontation with China will be in vain, and his political ratings will fall even more.

Also, the current head of the Pentagon, Mark Esper, went against Trump, who said that his department was not involved in the exercise of police functions and that the law of 1807 could be applied in the most dangerous situations, which obviously do not include peaceful rallies in most places. Well, at that time, Trump himself could not resist the temptation to insult James Mattis several times, calling him a "mad dog" and an "overrated general".

As for former US presidents, Barack Obama called the current protests the most meaningful of all that he has seen in his life and called on Americans to solve the problem of racism that exists in society. George Bush called on Trump to listen to the protesters instead of "crushing them". Bill Clinton said that "a white man would hardly have died like George Floyd".

No important statistics are scheduled for the last trading day of the week in the UK again. Thus, all the attention of traders will again be turned to the United States, where a fairly large amount of macroeconomic information will be published, and then information from the White House and personally from Donald Trump will not run out. Tomorrow, the US will release the unemployment rate for May, which will rise to 19.8% according to forecasts. Average hourly earnings in May will grow by just 1% on a monthly basis after increasing by 4.7% a month earlier. On an annual basis, however, an increase of as much as 8.5% is expected. The most important and significant Nonfarm Payrolls report, the number of new jobs created outside of agriculture, is expected to be -8 million. Thus, firstly, we believe that all statistics from across the ocean will in any case be weak because the language does not turn out to call negative values of indicators and reports, even if they are better than forecasts. Second, market participants may again ignore all these reports and data. Third, the US dollar is falling into the abyss without the help of statistics. Thus, the technical point of view is now the most important, since it makes no sense to try to guess when the fall of the US currency will stop. Quite unexpectedly for many, the US dollar ceased to be a protective asset that traders and investors bought to avoid additional risks. Even when the US stock market fell into the abyss, the US dollar still managed to get more expensive. Now we are faced with a completely opposite situation when market participants are trying to get rid of the dollar. Therefore, traders are now advised to follow the general trend, and not try to guess a possible turn down. The hourly chart (illustrations are available in the articles "last-minute forecasts") clearly shows that the pound/dollar pair came close to the maximum from April 14 and 30. If the level of 1.2642 does not deter buyers of the pound, the upward movement may continue with a new force.

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The average volatility of the GBP/USD pair continues to decline in general and is currently 113 points. For the pound/dollar pair, this indicator is "high", but not too high. On Friday, June 5, thus, we expect movement within the channel, limited by the levels of 1.2501 and 1.2727. Turning the Heiken Ashi indicator down will indicate a new round of corrective movement.

Nearest support levels:

S1 – 1.2573

S2 – 1.2512

S3 – 1.2451

Nearest resistance levels:

R1 – 1.2634

R2 – 1.2695

R3 – 1.2756

Trading recommendations:

The GBP/USD pair resumed a fairly strong upward movement on the 4-hour timeframe. Thus, today it is recommended to continue trading the pound/dollar pair for an increase with the goals of 1.2695 and 1.2727 and keep the longs open until the Heiken Ashi indicator turns down. It is recommended to sell the pound/dollar pair when the bears manage to return to the area below the moving average, with the first targets of 1.2390 and 1.2329.

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

Hot forecast and trading signals for the GBP/USD pair for June 5. COT report. Bulls need to capture levels 1.2642 and 1.2647

GBP/USD

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The pound/dollar pair, after a more or less tangible downward correction, resumed the upward movement and came close to the highs of April 14 and 30 - 1.2647 and 1.2642. These levels have not been reached at the moment, but the likelihood that the British pound will grow and end near them is high. The ascending channel failed to keep the pair inside, although we warned about this yesterday. As a result, we have a continuing upward trend, and the upward movement can continue if buyers manage to overcome the important levels of 1.2647 and 1.2642. The entire trend is still supported by only one upward trend line, which runs quite far from the price. Therefore, sellers can wake up and begin to slowly sell the pair near the 1.2642 level. But we recommend that you wait for good sell signals and only then trade the pair for a fall.

GBP/USD 15M

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The upper linear regression channel turned sideways on the 15-minute timeframe, which is almost the only sign of possibly starting a downward correction and the end of an upward trend. Interestingly, while the lower channel is again directed up.

COT Report

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Despite the fact that in total the demand for the pound sterling did not change among all major market participants during the reporting week (a total of 8600 contracts for buying and selling were opened), professional traders mainly bought the pound sterling at +5205 contracts, and at -1,686 transactions for contracts that got rid of the sale. Thus, the mood of traders remains upward, and in principle, the situation has not changed at the end of last week. The GBP/USD pair continued to grow in the new week, which means that demand for the pound is not declining. The new COT report may show even greater strengthening of the position of large buyers.

The fundamental background for the British pound remains negative despite the fact that this currency continues to go up in tandem with the US dollar. There were practically no important macroeconomic statistics in the UK and the United States this week, but the last trading day of the week will slightly correct this omission. Data on unemployment, NonFarm Payrolls and changes in average wages for May will be released in the United States. We believe that the last report can be ignored with a high degree of probability, and the first two with a lower one. In any case, nothing unexpected in statistics from overseas. The number of new jobs will again be negative, and the unemployment rate may jump up to 20%. However, given that the dollar has sharply fallen over the past two weeks, these reports may not add to the benefits of the euro and the pound. Moreover, no matter how bad the reports from the United States turn out to be, quotes of both pairs could still significantly fall tomorrow, since the downward correction is still brewing in both cases. Thus, we believe that technique is the most important right now. No important information from the UK has been received in recent days, but the general fundamental background remains negative.

There are two main scenarios as of June 5:

1) The initiative for the pound/dollar pair remains in the hands of buyers, who so far stick with purchases while aiming for 1.2642 and 1.2664. However, opening new long positions now carries increased risks, since the pair is near a strong level. We recommend considering new purchases of the British pound only after overcoming 1.2642 and 1.2647. In this case, the bulls will confirm their serious intentions for further growth.

2) Sellers continue to remain in the shadow and will be ready to return to the market if buyers depart from the level of 1.2642 (1.2647). Short positions can even begin to be considered near the level of 1.2642 (on the rebound), but in this case they will be openly counter-trend, and therefore dangerous. We consider the minimum necessary condition for sellers to overcome the area of 1.2403 - 1.2423. Then it will be possible to sell the pair with the goals of the trend line (1.2355) and Senkou Span B line (1.2276). In this case, Take Profit will be from 45 to 120 points.

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

Overview of the EUR/USD pair. June 5. The ECB will distribute the money until mid-2021. The EU economy may decline by more

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - sideways.

Lower linear regression channel: direction - upward.

Moving average (20; smoothed) - upward.

CCI: 227.4457

The EUR/USD currency pair started a long-awaited correction on June 4. It started and finished very quickly. In yesterday's reviews, we assumed that the European Central Bank will expand the program of recovery of the European economy after the crisis caused by the pandemic by several hundred billion euros, which will mean even more easing of monetary pressure. In practice, this is what happened. The ECB's ultra-soft monetary policy became even softer, however, the regulator had nothing to do. The crisis has dealt a painful blow, and the EU economy needs to be saved while there is still something to save. But the reaction of traders to what is happening once again raised a huge number of questions. It should be noted immediately that when the results of the ECB meeting were published, the euro currency first soared up, and then immediately began a downward pullback. Thus, the results of the ECB meeting led only to a small spike in volatility (a total of about 70 points), no more. But the subsequent growth of the European currency was in any case illogical. However, we will try to look at the overall picture and try to figure out what happened yesterday and what to expect next from the euro/dollar pair.

Looking a little ahead, we will immediately say that we are waiting for a decline in the European currency quotes. The euro has risen very much in recent days and all this upward movement has been almost non-recoilless. Thus, at least a technical correction is needed. Further, the main factor that contributed to the strengthening of the European currency was the fall in demand for the dollar due to mass unrest in the United States, as well as due to the uncertainty of future relations between the United States and China. However, we believe that both of these factors cannot have a lasting impact on the EUR/USD pair. Riots, riots, and so on - this is certainly bad, however, when the whole world was engulfed by a severe economic crisis, there are a lot more other bad things that did not have any impact on the dollar. Thus, we believe that the fall of the dollar in recent days was nothing more than an accident or a technical necessity (since one of the currencies can not become cheaper or grow constantly).

In the European Union, the news was bad yesterday. Retail sales in April decreased by 19.6% year-on-year and by 11.7% month-on-month. Although these figures are better than experts predicted, they are not optimistic. The European Central Bank predictably left the key rates unchanged – the deposit rate at -0.5%, the credit rate at 0.0%. But most importantly, the regulator expanded the PEPP (Pandemic Emergency Purchase program) program by 600 billion euros and extended its validity period for six months, that is, until June 2021. Such actions of the ECB can only be regarded negatively since they mean that the Eurozone economy is in trouble and the initial 750 billion euros will not be enough to get out of the crisis. The ECB also said in its final communique that rates will remain at current values until inflation returns to the target 2% y/y. Recall that at the end of May, inflation in the EU was recorded at a level of 0.1% y/y.

Christine Lagarde herself said during a press conference that the ECB expects GDP to decline by 8.7% in 2020. In 2021, according to the head of the regulator, there will be an increase of 5.2%, and in 2022 – by 3.3%. Recall that at the last meeting of the ECB, the following forecasts were announced: 2020 - +0.8%, 2021- + 1.3%, 2022- + 1.4%. Thus, first, in just two months, the ECB has significantly changed its expectations for the worse, and second, it may do so again or several times at subsequent meetings this year. We do not recommend treating the announced figures as accurate and final. The EU economy is likely to lose more than 8.7% this year. The same applies to inflation. According to the head of the ECB, it will slow down in 2020 to 0.3%, accelerate in 2021 to 0.8%, and in 2022 to 1.3%. Christine Lagarde also once again noted that the European economy is facing an unprecedented downturn due to the "coronavirus" epidemic. "Huge job losses, declining incomes, and a high level of uncertainty about the economic outlook have led to a drop in consumer spending and investment," the ECB Chairwoman said. Lagarde also noted that some indicators show a slight recovery in economic activity, however, it is not enough to talk about the recovery of the economy.

Well, in the United States yesterday, only data on applications for unemployment benefits were published. The number of primary applications for the week of May 29 was 1.9 million (slightly higher than forecasts), the number of secondary applications for the week of May 22 was 21.5 million with a forecast of 20.0 million. Thus, the overall unemployment rate rose again after another week. Perhaps this was the reason for the new fall in the US currency?

On Friday, June 5, there will be no important or significant publications in the European Union. Thus, traders will have to focus on macroeconomic statistics from overseas (discussed in detail in the article on GBP/USD), as well as all the same events in the US that led the EUR/USD pair to 2.5-month highs. From a technical point of view, a downward correction has been brewing for a long time and we were waiting for it last Friday or Monday. Thus, as before, we do not recommend that market participants try to guess the possible point of price reversal down. It is best to follow the trend clearly, especially since on the hourly chart, quotes continue to move perfectly inside the ascending channel, signaling the absence of any corrections or even hints of them. Therefore, to identify the beginning of the correction, you need to either wait for the Heiken Ashi indicator to turn down or for the pair to exit the ascending channel on the hourly chart. And the last thing I would like to say is that the pound also reacted to the ECB meeting, although it did not apply to it. The British currency also resumed growth in pair with the dollar and this is the strangest thing. There are reasons to assume that the ECB meeting was not the reason for the new strengthening of the euro.

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The average volatility of the euro/dollar currency pair as of June 5 is 93 points. Thus, the value of the indicator is still characterized as "average". We expect the pair to move between 1.1256 and 1.1442 levels today. The reversal of the Heiken Ashi indicator downwards signals a round of downward correction, which is expected for several days in a row.

Nearest support levels:

S1 – 1.1230

S2 – 1.1108

S3 – 1.0986

Nearest resistance levels:

R1 – 1.1353

R2 – 1.1475

R3 – 1.1597

Trading recommendations:

The EUR/USD pair continues its strong upward movement. Thus, after overcoming the psychological level of 1.1000, buy orders remain relevant, at this time - with the goals of 1.1442 and 1.1475, which are recommended to hold until the Heiken Ashi indicator turns down. It is recommended to return to selling the pair not before the price is re-anchored below the moving average line with the first goal of 1.0986.

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

Comprehensive analysis of movement options for EUR/GBP, GBP/JPY, and EUR/JPY (Daily) on June 2020

Minor operational scale (Daily)

The first month of summer - EUR/GBP, GBP/JPY, and EUR/JPY in the H4 timeframe - development options for the movement from June 5, 2020.

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Euro vs Great Britain pound

In June 2020, the development of the movement of the "main" EUR/GBP cross-instrument will continue in the 1/2 Median Line channel (0.8830-0.8960-0.9110) of the Minor operational scale forks - look at the animated chart for the details of movement within this channel 1/2 ML Minor.

A breakout of the lower border of the channel 1/2 Median Line of the Minor operational scale fork - support level 0.8830 - will determine the continued motion of the "main" cross-tool in the boundaries of the equilibrium zone of the Minor operational scale fork (0.8830-0.8685-0.8524) and Minute (0.8655-0.8560-0.8460).

If the upper limit of the channel 1/2 Median Line of the Minor operational scale forks is broken - resistance level 0.9110 - it will be possible to reach the EUR/GBP initial SSL line (0.9320) of the Minor operational scale forks.

The options for the EUR/GBP movement in June 2020 are shown in the animated chart.

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Great Britain pound vs Japanese yen

The development of the GBP/JPY in June 2020 will be due to the practicing of borders channels 1/2 Median Line of the Minuette operational scale fork (134.95-135.90-136.85) and Minor (137.90-134.50-131.90) - details of working out the boundaries of these channels 1/2 ML are presented on the animated chart.

If the support level of 131.20 on the lower border of the channel 1/2 Median Line of the Minor operational scale fork, together with the control line LTL (131.35) trading recommendations will make it possible to update the local minimum 129.28 and achievement of the initial line SSL Minor (128.85).

A joint breakdown of the upper boundaries of the 1/2 Median Line of the Minuette operational scales forks (resistance level 136.85) and Minor (137.30) will direct the development of the GBP/JPY movement to the borders of the equilibrium zones of the operational scales forks - Minute (139.10-141.50-143.45) and Minor (139.85-143.45-147.05).

Options for the movement of GBP/JPY in June 2020 are shown on the animated chart.

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Euro vs Japanese yen

The development of the movement of the EUR/JPY cross-instrument in June 2020 will depend on the development and direction of the breakdown of the range:

  • resistance level 122.00 - final Shiff Line of the Minor operational scale fork;
  • support level 121.05 - upper bound of ISL61.8 equilibrium zone of the Minor operational scale fork.

At the breakdown of ISL61.8 Minor - support level 121.05 - the development of the EUR/JPY movement can be continued within the boundaries of the balance zones of the operational scales forks - Minor (121.05-119.95-118.70) and Minute (118.70-117.40-116.20).

If the resistance level 122.00 is broken at the final Shiff line Minor and the initial SSL line (122.45) of the Minuette operational scale forks, followed by the maximum update of 122.84, the upward movement of EUR/JPY can be continued to the FSL (125.10) of the Minor operational scale fork.

Details of the development of the EUR/JPY movement in June 2020 are shown on the animated chart.

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The review is compiled without taking into account the news background, the opening of trading sessions of the main financial centers, and is not a guide to action (placing "sell" or "buy" orders).

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

Hot and trading signals for the EUR/USD pair for June 5. COT report. Results of the ECB meeting added fuel to the fire. Buyers

EUR/USD 1H

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The EUR/USD pair continued its upward movement on the hourly timeframe on June 4, when everything seemed to be in favor of starting a downward correction. However, as we have already mentioned in fundamental articles, a rather strong and recoilless trend has now taken shape and it is completely inexpedient to guess the point of its possible completion. Thus, over the past day, the euro's quotes overcame the resistance level of 1.1312, and also went beyond the rising channel, which indicates an even greater strengthening of the trend. The last target of buyers for this week is the resistance level of 1.1478, and the beginning of the correction can still be identified by consolidating the price below the rising channel and/or the Kijun-sen line. Up to this point, the bulls will continue to hold the market in their hands.

EUR/USD 15M

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The picture does not change at all on the 15-minute timeframe. The same two linear regression channels that are directed upwards are at your disposal, which indicate the absence of any signs of starting a correctional movement.

COT Report

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The latest COT report showed that professional traders unexpectedly started buying the euro during the reporting week. Suddenly - because, from our point of view, the fundamental background was not in favor of the euro. However, throughout the current week, the fundamental background was already in favor of the euro due to mass rallies and protests in the United States. Large traders found reason to open new 7524 purchase contracts last week. For the reporting week, only 3817 sales contracts were opened, if we take into account the most important group of traders, the professional players who work in the market with the goal of making a profit due to exchange rate differences. This information is already enough to understand that the mood of large traders for the reporting week has changed to bullish. The entire current week also remains with buyers, so in the new COT report we can see an even greater increase in purchase contracts among professional traders.

The general fundamental background for the EUR/USD pair remains neutral if we only take into account economic news. Yesterday, the results of the ECB meeting showed that the regulator expects serious deterioration in the economy compared to its own expectations in March. The PEPP program was immediately expanded to 600 billion euros and its terms were extended. As we have already mentioned, this does not mean that a total of 1.35 trillion euros will be enough to cope with the consequences of the pandemic and the crisis. In the same way, if not the fact that the total losses of the European economy in 2020 will amount to 8.7%, and not more. Thus, these figures were supposed to force traders to refuse buying the euro yesterday. However, either the macroeconomic background was again ignored, or traders considered that a +600 billion aid to the eurozone economy is good, however, the single currency has risen in price again. The United States also retains a negative background. Statistics from across the ocean continue to come weak and at times disastrous, which in principle is not surprising for times of crisis. Rallies and protests continue. The situation between China and the US continues to heat up. Thus, the main thing is that all this does not end in an explosion. Too many processes now can end completely unpredictably. Well, US President Donald Trump continues to lose support at this time, which significantly reduces his chances in November 2020.

Based on the foregoing, we have two trading ideas for June 5:

1) It is possible for quotes to grow further with the goal of the resistance level for the 4-hour chart at 1.1478. However, for this, the bulls just need to continue to stay within the rising channel and protect the level of 1.1312, which is left behind. Stop Loss levels can still be placed below the channel and gradually transferred to the top. Potential Take Profit in this case is 130 points.

2) The second option involves consolidating the EUR/USD pair under the ascending channel, which will allow sellers to finally join the game and begin to trade down. However, we recommend that you wait until the consolidation below the Kijun-sen line and only after that open sell positions with targets 1.1147 (March 27 high) and 1.1011 (Senkou Span B line). Overcoming each of the barriers will keep sales open. Potential Take Profit range from 60 to 190 points.

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

Rally in the stock markets of Europe and America continues

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The stock markets of the United States of America continue to rise steadily. Yesterday's trading closed in a positive zone in almost all directions. The reason for this was the next batch of statistics, which demonstrated that the damage from the global COVID-19 pandemic would be slightly less than previously thought. Moreover, the Dow Jones Industrial and S&P 500 indices showed a very outstanding result and were able to reach the highest level in the last three months.

The Dow Jones Industrial Average index was higher by 527.24 points at the end of the trading session, indicating a growth of more than 2% (plus 2.05%). This allowed it to be at around 26,269.89 points.

The Standard & Poor's 500 index increased by 42.05 points, or 1.36%: its result at the close of trading was 3,122.87 points.

The Nasdaq Composite Index also rose 74.54 points (plus 0.78%) and reached 9,682.91 points.

It can be recalled that the stock markets of not only America, but other regions have recently recorded a positive trend. For several trading sessions, they are closing in the positive zone in most areas. Even the protests in the United States, which continue to this day, could not weaken the interest of investors. In addition, market participants almost stopped responding to the conflict between the United States and China, because they realized that the words of the American leader were at odds with the deed. He repeatedly stated about the termination of trade relations between countries, but so far this has not happened, and investors have ceased to take it seriously.

This week, another batch of unemployment statistics was released in the United States of America, which, by the way, turned out to be much better than preliminary forecasts. As it became known, the number of jobs in the country in the private sector in May declined by 2.76 million, which was much lower than analysts' expectations. Most experts argued that the reduction should be no less than 8.66 million. It should be noted that it was at the level of 19.56 million in April. Such rapid positive dynamics in this sector cannot pass by the eyes of investors who respond positively to such news, since they are an indicator of a faster recovery of the economy after the crisis that occurred against the backdrop of the coronavirus pandemic.

Market participants are now waiting for unemployment statistics from the US Department of Labor, which should be released tomorrow.

The growth was also noted by the index of business activity in the service sector of America. Over the past month, it became larger and reached the level of 45.4 points, while it occupied a record low line at 41.8 points in April. Analysts' preliminary forecasts were much more modest: an increase of no more than 44 points was expected. This also cannot but please traders who understand that the economy is gradually returning to its previous mode of operation.

The market is waiting for positivity. Investors hope that the worst is behind us and that only growth will await everyone in the future, and this makes the main indexes grow. Moreover, the confidence of market participants is supported by the resumption of the work of an increasing number of enterprises in the country. At the same time, risky assets are also in demand due to grand stimulus measures from the US Federal Reserve, which is doing everything to help the economy get out of stagnation.

Bank securities rise in value almost everywhere. Shares of Citigroup Inc. rose 4.9%, Wells Fargo & Co. became more valuable by increasing 5.2%, and Bank of America Corp. increased by 4.6%.

The stock price of the largest record company in the world, Warner Music Group Corp., demonstrated incredible growth immediately by 20.5%, which was not expected by even the most experienced investors.

Securities Lyft Inc. rose by 8.7 and Shares of Zoom Video Communications Inc. rose in price by 7.6%. This is one of the few companies that was able to increase revenue by more than 2.7 times t during the stagnation.

Nevertheless, it was not without some negativity: for example, a decline of 6.1% was noted in Campbell Soup Co. securities. And this despite the fact that one of the largest food producers in the United States of America was marked by an increase in net profit for the third financial quarter, which made it possible to make a better forecast for the next financial year.

Stock indices of European countries have also caught a positive wave and are growing amid news about the ongoing opening of world economies.

According to the results of yesterday's trading session, the overall index of enterprises in the Stoxx Europe 600 region grew by 2.54%. Its current level was at around 368.92 points.

The UK FTSE 100 index gained 2.61%, the German DAX index increased 3.88%, the French CAC index supported positive dynamics and rose 3.36%, the Italian FTSE MIB index jumped 3.54%, and the Spanish index IBEX 35 added 2.95% to the previous value.

Yesterday's statistics on unemployment in Europe, which was presented by the Statistical Office of the EU, reflected an increase of 7.3% in 19 countries of the region. It can be recalled that this indicator also increased by 7.1% a month earlier. Most experts claimed that growth would be higher - at least 8.2%. Thus, some improvement in this sector supported the market.

The general index of procurement managers among 19 eurozone countries last month became higher and went to the level of 31.9 points. It can be noted that a catastrophic drop to 13.6 points was recorded in April. The preliminary forecasts of experts also turned out to be more modest: an increase of up to 30.5 points was expected. Thus, the current situation could not but rejoice investors.

The activity indicator in the EU services sector also became larger and reached the level of 30.5 points. And here, preliminary forecasts reflected the smallest possible growth - up to 28.7 points. The minimum value of April was at the level of 12 points.

In the corporate sector, an increase in the value of shares in the following companies can be noted. LVMH increased its value by 2.21%, a positive effect was noted after the acquisition of the American jewelry chain Tiffany & Co, whose value is estimated at $ 16.2 billion.

Securities Renault SA increased by 10.5% after the news of the opening of a credit line in the amount of 5 billion euros, or 5.58 billion dollars in a group of banks with a guarantee from the state.

Deutsche Lufthansa AG shares also increased in value by 7.7%, although the company's net loss for the first quarter was very significant.

The French insurance company AXA SA rose at the same time by 9.4%, despite the decision to pay dividends almost half as much.

The general positivity does not leave the stock markets, which is likely to continue the emerging growth and strengthen the confidence of investors.

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

EUR/USD. ECB June meeting: an attraction of unprecedented generosity

The European Central Bank more than met the expectations of EUR/USD bulls. Let me remind you that in anticipation, market participants decided that the ECB's June meeting regarding the expansion of the Pandemic Emergency Purchase Program (PEPP) is today's main intrigue.To date, the European regulator has spent 210 billion euros out of 750 (that is, less than a third), so it could well afford not to rush to further decisions on this issue, postponing the consideration of the extension of PEPP to the July or September meeting. Another argument in favor of maintaining a wait-and-see attitude was the weakening of quarantine measures in key European countries. At the current pace of spending, the 750 billionth volume of the program would have been used up only in mid-October. That is, Christine Lagarde could wait until the end of the summer, assessing in September the need for additional infusions.

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By and large, there was no extraordinary need to expand PEPP at the June meeting. But the whole catch was that the market expressed general confidence that the ECB would allocate an additional 500 billion euros, as if repaying the unrest in this regard in advance. Solomon's solution would be to expand the program by 250 billion while prolonging its validity for next year.

Any "half measures" and especially the wait-and-see attitude on the part of the ECB would allow the bears to seize the initiative and direct the price to the support level of 1.1100 (Tenkan-sen line) on the daily chart.

But it turned out differently: Lagarde not only expanded the PEPP, but also exceeded even the most optimistic expectations, increasing the program by 600 billion euros. In addition, the head of the ECB extended the program "at least until June 2021". In other words, the most optimistic scenario for the euro was realized today, and this fact made it possible for EUR/USD buyers to update their three-month price highs, settling in the 13th figure.

All subsequent pessimistic comments of Lagarde were simply ignored by traders: the market has long been aware that the second quarter's performance will be worse than the first, and the recession in the eurozone economy is unprecedented. Traders played back this pessimism last month, and now their eyes are on the future - in fact, they are only interested in one question: how quickly can the eurozone economy recover in the second half of the year? Any information that indicates the support of reconstruction processes by the authorities or financial institutions pushes the euro up. Given this disposition, it is not at all surprising that the pair is now showing an upward momentum, conquering the 13th figure.

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After all, the euro is growing not only at the decision of the ECB - Germany also helped the pair as it just agreed on a package of incentive measures for 130 billion euros, which includes reducing the value added tax from 19% to 16%. The preferential VAT rate will also be temporarily reduced (from 7% to 5%). In addition, German families will receive a lump sum payment of 300 euros per child. From 2021, due to state subsidies, electricity prices for the population and business will be reduced; subsidies for the purchase of electric vehicles will increase, and billions of dollars will be invested in the Deutsche Bahn railway company and public transport. The incentive package also includes additional assistance for the sectors most affected by the pandemic - first of all, we are talking about the tourism and restaurant business. And this lists only key measures: in general, the approved document consists of 57 points.

The euro is also supported by the European Commission's anti-crisis plan, which is now worth 750 billion euros. Here, however, things are not so smooth: Austria continues to oppose this initiative, demanding a review of the conditions for the funds provided (to replace subsidized assistance with loans). But EUR/USD buyers are still looking at this problem through their fingers. There is some certainty in the market that they can still convince Vienna. The main argument in favor of this version is the position of Germany, which supported the plan of the head of the European Commission.

Thus, the euro-dollar pair retains the potential for its further growth in the medium term. Nevertheless, one should be careful with purchases now - after such impulsive price spikes, a correction usually follows, up to the mark of 1.1270. Therefore, do not jump into the outgoing train. But in general, the euro received an additional trump card today, which will fuel investor interest in the single currency.

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From a technical point of view, priority is also given to the growth of EUR/USD, and on all the higher timeframes - H4, D1, W1 and MN. So, on the daily chart, the price exceeded the upper line of the Bollinger Bands indicator, and the Ichimoku indicator formed a bullish Parade of Lines signal. The weekly chart also shows the priority of the growth scenario: the pair also broke the upper line of the Bollinger Bands indicator, and the price is above the Kumo cloud. The monthly chart indicates that the price is between the middle and upper lines of the Bollinger Bands indicator - that is, subsequent growth can be of a larger scale - up to the level of 1.1400 (Tenkan-sen line on MN). If the pair stays within the 13th figure at the end of the day, we can consider long positions to this resistance level.

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