Brief trading recommendations for EUR/USD and GBP/USD on 07/16/20

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The EUR/USD currency pair is moving within the area of 1.1400/1.1440, which reflects the resistance in the market, stopping buyers. The upward trend line plays the role of a deterrent from further decline. That is why, when the line breaks, market participants will receive a sell signal.

It is recommended to sell a pair at a price below the trend line, in this case, below the level of 1.1390, in the coordinate direction of 1.1350-1.1300

An alternative scenario will be considered in the event of another rebound from the upward trend line and price consolidation above 1.1450, which theoretically, can lead to a breakdown of the resistance level which will let the price move towards 1.1500.

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For the GBP/USD currency pair, there is a looped oscillation between the two main levels of 1.2500/1.2620 (+/-20 points), where a rebound is made sequentially. In this case, there is a movement from the level of 1.2620, which plays the role of resistance. If the downward movement continues, it will lead us to the area of the pivot point, which reflects the level of 1.2500.

It is recommended to sell a pair at a price below the level of 1.2550 with the prospect of a movement to 1.2500.

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Analysis and trading recommendations for the EUR/USD and GBP/USD pairs on July 16, 2020

Possible buy and sell levels for EUR / USD on July 16.

EUR / USD

Analysis of transactions

The trading idea yesterday was to buy positions at the level of 1.1413. As we can see in the chart (highlighted in green), this was done by traders, after which the European currency went up, also due to the publication of good inflation data in Italy, which grew along with the recovery of the economy after the coronavirus pandemic.

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Thus, the following are the recommended entry and exit positions for the EUR / USD pair today.

It is also necessary to pay attention to the upcoming meeting of the European Central Bank, during which the decisions on monetary policy will be discussed. The stance on interest rates may change there, which will affect the exchange rate of the European currency.

Hence:

  • Buy positions when the quote reaches the value of 1.1418, targeting the level of 1.1460. This may occur after the ECB's monetary policy report on US industrial production. Exit the market at the quote of 1.1460.
  • Sell positions after the quote reached the value of 1.1392, with a target of decrease to the level of 1.1351. Exit the market after it, as many new buyers will be concentrated in this range, looking for a continuation of the trend. In addition, the lower trend line passes at the level of 1.1392.

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Possible buy and sell levels for GBP / USD on July 16.

The following are the recommended entry and exit positions for the GBP / USD pair today.

The latest data on US industrial production helped the US dollar to grow against the British pound. But today, the report on the UK labor market will be important, as the intensity of its recovery will affect the future growth of the economy. A good performance in the index will inevitably strengthen the British pound.

Hence:

  • Buy positions when the quote reaches the level of 1.2575 (green line on the chart), in order to see a rise to the value of 1.2622. This may occur after the publication of the report on the labor market. Exit the market at the level of 1.2622.
  • Sell positions after the quote reached the level of 1.2550 (the red line on the chart), so that the price will decrease to a value of 1.2499. Upon reaching it, exit the market, since the bulls will concentrate on this range.

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Technical Analysis of BTC/USD for July 16, 2020:

Crypto Industry News:

The Mitsubishi UFJ or MUFGt financial group, the fifth largest bank in the world, reportedly plans to issue its own digital currency in the second half of 2020.

The digital currency project launched in 2015 was originally intended to operate in a Blockchain network and facilitate instant peer-to-peer transactions. After many delays, the initiative is to be implemented no later than in 2020.

Hironori Kamezawa, president and CEO of MUFG, announced on Monday new plans for the local news agency Mainichi Shimbun. As part of the upcoming premiere, MUFG plans to launch mobile retail payments based on digital currency in cooperation with its partner, the Recruit Group.

According to the report, Kamezawa said that almost 1 million member recruitment stores have already signed up for this collaboration. "We believe that everyone will be able to use it openly," noted the CEO, adding that in the future the MUFG token will also be available in stores that are not recruits.

The MUFG token was designed as a stablecoin based on 1: 1 Blockchain relative to the Japanese yen. About five years ago, the implementation of the MUFG token has been delayed several times since the project began. The bank reportedly tried to launch the token in both 2018 and 2019.

Technical Market Outlook:

The BTC/USD pair gets closer to the key short-term support located at the level of $9,000 as it keeps trading below the short-term trend line resistance and below the local technical resistance located at $9,240. The past Pin Bar candlestick low was made at the level of $9,052, which is just below the 61% Fibonacci retractement located at $9,082. If violated again, then the key short-term support is violated and the drop might accelerate towards the level of $8,860. The momentum is still hovering around the neutral level, but there is no sign of increased bullish activity. Only a sustained breakout through the trend line resistance might put the bulls back to control over the market again.

Weekly Pivot Points:

WR3 - $10,016

WR2 - $9,728

WR1 - $9,448

Weekly Pivot - $9,161

WS1 - $8,884

WS2 - $8,576

WS3 - $8,302

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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Technical Analysis of EUR/USD for July 16, 2020:

Technical Market Outlook:

Another Bearish Engulfing candlestick pattern has been made at the top of the last move up at the level of 1.1452, but bulls are not giving up. This is the seventh attempt to rally above the supply zone located between the levels of 1.1406 - 1.1419. The RSI indicator shows the positive and strong momentum, so the market participants should wait for a Pin Bar like candlestick around the level of 1.1400. If there is this kind of a reversal candlestick pattern, then the bulls might continue the local up trend towards the level of 1.1497.

Weekly Pivot Points:

WR3 - 1.1497

WR2 - 1.1428

WR1 - 1.1365

Weekly Pivot - 1.1301

WS1 - 1.1233

WS2 - 1.1170

WS3 - 1.1101

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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Technical Analysis of GBP/USD for July 16, 2020:

Technical Market Outlook:

The GBP/USD pair has made a Bearish Engulfing pattern at the top of rally towards the level of 1.2668. The local high was made at the level of 1.2648 and then the market has reversed and is currently testing the local technical support located at the level of 1.2547. The RSI indicator shows the momentum is neutral, so neither bulls not bears are in control of the market (on the short-term time frame like H4). Any violation of the level of 1.2466 will accelerate the sell-off towards the next technical support seen at the level of 1.2406.

Weekly Pivot Points:

WR3 - 1.2915

WR2 - 1.2796

WR1 - 1.2712

Weekly Pivot - 1.2585

WS1 - 1.2508

WS2 - 1.2378

WS3 - 1.2304

Trading Recommendations:

On the GBP/USD pair the main trend is down, which can be confirmed by the down candles on the weekly time frame chart. 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 even lower in the longer-term.

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Fractal analysis of main currency pairs on July 16th

Forecast for July 16 :

Analytical review of currency pairs on the scale of H1:

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The key levels for the euro / dollar pair on the H1 scale are: 1.1498, 1.1466, 1.1421, 1.1381, 1.1362 and 1.1330. Here, we follow the ascending structure of July 10th. The continuation of the upward movement is expected after the breakdown of the level of 1.1421. In this case, the target is 1.1467. Price consolidation is near this level. The breakdown of the level of 1.1467 will allow you to count on movement towards a potential target - 1.1498. Upon reaching which, we expect a downward pullback.

A short-term downward movement is possible in the range of 1.1381 - 1.1362. The breakdown of the last level will lead to a deeper correction. Here, the target is 1.1330. This is a key support level for the top.

The main trend is the formation of the ascending structure of July 10

Trading recommendations:

Buy: 1.1423 Take profit: 1.1465

Buy: 1.1467 Take profit: 1.1497

Sell: 1.1380 Take profit: 1.1363

Sell: 1.1360 Take profit: 1.1333

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The key levels for the pound / dollar pair on the H1 scale are: 1.2670, 1.2617, 1.2480, 1.2410, 1.2339 and 1.2293. Here, the price forms the potential for the downward movement of July 13. The continuation of the downward movement is expected after the breakdown of the level of 1.2480. In this case, the target is 1.2410. Price consolidation is near this level. The breakdown of the level of 1.2410 should be accompanied by a pronounced downward movement. Here, the target is 1.2339. For the potential value for the bottom, we consider the level of 1.2293. Upon reaching which, we expect consolidation and an upward pullback.

The level of 1.2617 is a key support for the bottom and its breakdown will favor the formation of an ascending structure. Here, the first goal is 1.2670.

The main trend is the formation of a downward potential of July 13

Trading recommendations:

Buy: 1.2618 Take profit: 1.2670

Buy: Take profit:

Sell: 1.2480 Take profit: 1.2413

Sell: 1.2408 Take profit: 1.2340

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The key levels for the dollar / franc pair on the H1 scale are: 0.9526, 0.9500, 0.9482, 0.9459, 0.9435, 0.9422 and 0.9403. Here, we continue to monitor the ascending structure of July 9th. The continuation of the upward movement is expected after the breakdown of the level of 0.9460. In this case, the target is 0.9482. Price consolidation is in the range of 0.9482 - 0.9500. For the potential value for the top, we consider the level of 0.9526. Upon reaching this level, we expect a downward pullback.

A short-term downward movement is expected in the range of 0.9435 - 0.9422. The breakdown of the last level will lead to a deeper correction. Here, the target is 0.9403. This is a key support level for the top.

The main trend is the rising structure of July 9th.

Trading recommendations:

Buy : 0.9460 Take profit: 0.9480

Buy : 0.9484 Take profit: 0.9500

Sell: 0.9435 Take profit: 0.9424

Sell: 0.9420 Take profit: 0.9405

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The key levels for the dollar / yen pair on the scale are : 107.47, 107.27, 107.07, 106.63, 106.39, 106.10 and 105.89. Here, we are following the formation of potential for the downward movement of July 14. The continuation of the downward movement is expected after the breakdown of the level of 106.63. In this case, the target is 106.39. Price consolidation is near this level. The breakdown of the level of 106.37 will lead to a pronounced downward movement. Here, the goal is 106.10. For the potential value for the bottom, we consider the level of 105.89. Upon reaching which, we expect consolidation, as well as an upward pullback.

A short-term upward movement is possible in the range 107.07 - 107.27. The breakdown of the last level will favor the development of the upward structure. In this case, the target is 107.47.

The main trend is building potential for the bottom of July 14

Trading recommendations:

Buy: 107.08 Take profit: 107.25

Buy : 107.28 Take profit: 107.45

Sell: 106.63 Take profit: 106.40

Sell: 106.37 Take profit: 106.12

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The key levels for the Canadian dollar / US dollar pair on the H1 scale are: 1.3645, 1.3593, 1.3562, 1.3536, 1.3494, 1.3449, 1.3395 and 1.3358. Here, we are following the formation of potential for the downward movement of July 14. The continuation of the downward movement is expected after the breakdown of the level of 1.3494. In this case, the target is 1.3449. Price consolidation is near this level. The breakdown of the level of 1.3449 will lead to a pronounced movement. Here, the target is 1.3395. For the potential value for the bottom, we consider the level of 1.3358. Upon reaching which, we expect consolidation, as well as an upward pullback.

A short-term upward movement is possible in the range of 1.3536 - 1.3562. The breakdown of the last level will lead to a deeper correction. Here, the target is 1.3593. This is the key support level for the descending structure of July 14.

The main trend is the formation of potential for the downward movement of July 14

Trading recommendations:

Buy: 1.3536 Take profit: 1.3561

Buy : 1.3563 Take profit: 1.3592

Sell: 1.3493 Take profit: 1.3450

Sell: 1.3447 Take profit: 1.3397

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The key levels for the Australian dollar / dollar pair on the H1 scale are : 0.7121, 0.7095, 0.7056, 0.7025, 0.6986, 0.6970, 0.6946, 0.6923 and 0.6898. Here, the price forms the local potential for the top of July 14. The continuation of the upward movement is expected after the breakdown of the level of 0.7025. In this case, the target is 0.7056. Price consolidation is near this level. The breakdown of the level of 0.7056 will lead to a pronounced upward movement. Here, the target is 0.7095. For the potential value for the top, we consider the level of 0.7121. Upon reaching which, we expect consolidation, as well as a downward pullback.

A short-term downward movement is possible in the range 0.6986 - 0.6970. The breakdown of the last level will lead to a deeper correction. Here, the target is 0.6946. This is a key support level for the top and its breakdown will lead to the cancellation of the upward structure from July 14. In this case, the target is 0.6898.

The main trend is the local upward structure of July 14

Trading recommendations:

Buy: 0.7025 Take profit: 0.7055

Buy: 0.7060 Take profit: 0.7095

Sell : 0.6970 Take profit : 0.6948

Sell: 0.6944 Take profit: 0.6923

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The key levels for the euro / yen pair on the H1 scale are: 124.26, 123.67, 123.21, 122.56, 121.89, 121.50 and 121.07. Here, we are following the formation of the ascending structure of July 10. The continuation of the upward movement is expected after the breakdown of the level of 122.56. In this case, the target is 123.20. Short-term upward movement, as well as consolidation are in the range of 123.21 - 123.67. For the potential value for the top, we consider the level of 124.26. Upon reaching which, we expect consolidation, as well as a downward pullback.

A short-term downward movement is possible in the range of 121.89 - 121.50. The breakdown of the last level will lead to a deeper correction. Here, the goal is 121.07. This is a key support level for the top.

The main trend is the formation of potential for the upward cycle of July 10

Trading recommendations:

Buy: 122.58 Take profit: 123.20

Buy: 123.22 Take profit: 123.65

Sell: 121.87 Take profit: 121.52

Sell: 121.48 Take profit: 121.09

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The key levels for the pound / yen pair on the H1 scale are : 135.91, 135.32, 135.07, 134.68, 133.68, 132.99, 132.57 and 131.99. Here, we are following the descending structure of July 9th. The continuation of the downward movement is expected after the breakdown of the level of 133.68. In this case, the target is 132.99. A short-term downward movement, as well as consolidation are in the range of 132.99 - 132.57. For the potential value for the bottom, we consider the level of 131.99. Upon reaching this level, we expect consolidation, as well as an upward pullback.

A correction is expected after the breakdown of the level of 134.68. Here, the target is 135.07. The range of 135.07 - 135.32 is a key support for the downward structure and the price passing this level will lead to the formation of an upward structure, here the potential target is 135.91.

The main trend is the descending structure of July 9

Trading recommendations:

Buy: 134.68 Take profit: 135.07

Buy: 135.32 Take profit: 135.90

Sell: 133.68 Take profit: 133.00

Sell: 132.97 Take profit: 132.58

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Elliott wave analysis of EUR/GBP for July 16, 2020

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The expected minor set-back to 0.9034 is currently unfolding and the corrective pattern is some kind of flat correction is unfolding. It means that a rally back close to the former peak at 0.9113 and then a second dip close to 0.9034 from where the next impulsive rally higher towards 0.9485 is expected.

R3: 0.9175

R2: 0.9113

R1: 0.9074

Pivot: 0.9064

S1: 0.9050

S2: 0.9044

S3: 0.9034

Trading recommendation:

We are long EUR from 0.8646 with our stop placed at 0.8630

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Elliott wave analysis of EUR/JPY for July 16, 2020

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The EUR/JPY pair is following the expected path. It is currently in a minor correction towards 121.43 from where we expect a new impulsive rally towards at least 129.64 and more likely an extending rally in wave 3 to the 161.8% extension target at 135.42.

In the short-term, we continue to look for a dip to 121.43 and then a new push higher through resistance at 122.50 for a rally to 124.43-129.64 and likely even higher.

R3: 122.73

R2: 122.50

R1: 122.25

Pivot: 122.06

S1: 121.85

S2: 121.43

S3: 121.20

Trading recommendation:

We will buy EUR at 121.50 or upon a break above 122.50

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EUR/JPY forecast, July 16, 2020.

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On the 4 hour chart, we can see the hidden divergence between the stochastic oscillator and the price. It means that the EUR/JPY pair will continue its upward movement. It may reach the 122.47 level. This scenario will come true if the pair does not decline and close bellow the 121.44 level. The overall bias for EUR/JPY is now bullish.

(Disclaimer)

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Instant Forecast For USD/MXN On July 16, 2020

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Today USD/MXN still continues its downward movement and it will try to reach the 22.251 level, although this is confirmed by the Hidden Divergence between the price and the Stochastic Oscillator on the 4-hour chart. However, this scenario will be automatically canceled if the currency pair makes a retracement upwards and closes above the 22.453 level.

(Disclaimer)

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Control zones for USDJPY on 07/16/20

The pair fell yesterday, however, the main support zone of the WCZ 1/2 106.51-106.35 was not tested. It will be possible to consider purchases if it is tested today. The growth target is the current week's high. The probability of resuming the upward momentum is 75% while the pair is trading above the WCZ.

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Working within the local accumulation zone implies purchases below yesterday's low with the formation of the absorption pattern.

An alternative model will develop for increasing the price of the Japanese yen if the closing of today's trading occurs below the level of 106.35. This will allow you to search for favorable prices for selling the instrument tomorrow and changing the direction of monthly trading.

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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.

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Overview of the GBP/USD pair. July 16. Black Americans, Latinos, as well as several "Republican" and "fluctuating" states

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) - sideways.

CCI: -10.4497

The British pound also resumed its upward movement against the dollar, probably for the same reasons as the European currency. We have repeatedly said that the reasons for strengthening the British currency are much less than the euro, since there are a huge number of unresolved issues in the UK regarding the country's continued existence and cooperation with the European Union after Brexit. To be more precise, so far everything is going to the point that there will be no cooperation with the EU at all, or it will be worked out "in a hurry". However, the difficult state of the pandemic in the US, as a result of high fears of investors and traders about the economy, make the US dollar continue to fall in price. In the United States, the highest growth rates of COVID-2019 distribution are maintained. Over the past day, 58 thousand new cases of infection were detected. In terms of morbidity and mortality from the virus, the United States leads the world. Anti-records also continue to be updated in some states. In Texas, over the past day, almost 11 thousand cases of the disease were detected, and a total of 275,000 cases were registered, which is more than in Italy or Spain. At the same time, the first stage of testing of one of the vaccines against "coronavirus" was completed in the United States. It is reported that the vaccine has performed well in human trials, but causes a number of side effects, such as headache, chills, fatigue, and muscle pain. The first stage involves testing on healthy people. The second stage will include testing on other categories of people, different age groups. However, we do not consider this news optimistic. Recall that 141 vaccines against COVID-2019 are currently being developed worldwide and none of them has yet passed all types of clinical testing and has not been allowed to mass production. Doctors around the world have repeatedly said that creating a vaccine against a new virus is a very long and time-consuming process.

While there is no interesting information coming from the UK, we suggest focusing again on the problems of America, as they have the greatest impact on the foreign exchange market, allowing the British pound and the euro to become more expensive in recent months. We have already discussed the pandemic and its possible consequences for the American economy. However, an important question is how the United States are going to get out of the second "wave" of the epidemic, how are they going to protect themselves against a possible third "wave" and most importantly - what course will the country follow after November? After all, it is no secret that the presidential election will be held in November, and if Trump loses, he will leave office in January 2021. The main candidate for President in 2020, Joe Biden, offers a fairly extensive plan to create new jobs in the country, which will not be superfluous, given how many people lost their jobs during the crisis. Biden proposes to allocate $ 2 trillion to fight climate change and significantly reduce carbon emissions from power plants. Biden's plan also includes upgrading the country's infrastructure, aimed at increasing the number of electric vehicles and improving the energy efficiency of buildings. "There is no more important challenge that we must meet in the next decade than the coming climate crisis. If left unaddressed, it will become a real threat to the health of our planet and our very survival," the Democratic candidate said. In addition, Biden promises to solve many socially important issues. For example, achieving racial justice, increased attention to scientists, and a return to true democracy, which, according to Biden, "completely destroyed Trump". The Republican candidate, Trump, has already criticized Biden's plan, saying that he "will kill the US energy complex". At the same time, Trump showed that he does not care about climate issues, as well as about democracy. Trump's main promise is a rapid and complete recovery of the US economy.And there are much more controversial points than it seems at first glance. We have already understood that Trump will seek to restore the country's economy, but with what sacrifices? According to the country's chief epidemiologist Anthony Fauci, the US authorities rushed to cancel the "lockdown", as a result, they received a second "wave" of the epidemic. And the epidemic will not allow the American economy to recover at the pace that Trump needs. However, this does not matter, since the economy will not have time to recover in any case in the three months remaining before the elections. Trump needs voters to believe in his plan. However, it is being criticized more and more often, and not without reason. To some extent, quarantine measures in the US continue to operate in 27 states, which, of course, greatly hinders Trump's intentions. State governors in the United States have every right to decide on their own issues with the quarantine, the President can not order them to "open" the state. The US leader has been criticized for being too focused on his own re-election, rather than on the security of Americans. Although the Americans themselves pay their President in the same coin. Almost 90% of the black population of the United States does not approve of Trump's actions as President. About 70% of Latinos oppose Trump's re-election. Several states that were considered "Republican" are ready to vote for Joe Biden. Several "wavering" states that brought victory to Trump in 2016 are not ready for his re-election. So far, everything suggests that Trump will not be re-elected, and the US recovery course will be as democratic as possible.

Yesterday in the UK, the consumer price index for June was published, which, however, did not cause any reaction from traders. The value of inflation was 0.6% y/y, which in any case is very small, although experts' forecasts were exceeded. Today, the average wage and unemployment rate for May are scheduled to be published in Britain. However, we believe that traders will continue to ignore the statistics and continue to pay more attention to the overall fundamental background. From a technical point of view, the quotes of the pound/dollar pair returned to the exit area of the moving average line, so the upward trend is resumed. Both linear regression channels are directed upwards.

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The average volatility of the GBP/USD pair continues to remain stable and is currently 86 points per day. For the pound/dollar pair, this value is "average". On Thursday, July 16, thus, we expect movement within the channel, limited by the levels of 1,2503 and 1,2675. A reversal of the Heiken Ashi indicator downwards will indicate a downward movement, and the pair may re-establish itself below the moving average.

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 on the 4-hour timeframe after an unsuccessful attempt to overcome the Murray level of "7/8" can start a new round of downward movement and go below the moving average. Thus, buy orders with the goals of 1.2695 and 1.2756 are still valid, however, we recommend opening buy positions only if the pair is fixed above the previous lows (1.2669). It is recommended to resume selling the pair after fixing the quotes below the moving average with the first goal of 1.2512.

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EURJPY facing bearish pressure from our resistance, potential reversal

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Trading Recommendation

Entry: 122.208

Reason for Entry: 61.8% fibonacci retracement, 61.8% fibonacci extension, horizontal pullback resistance and break out trend line

Take Profit: 121.203

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

Stop Loss: 122.511

Reason for Take Profit: Horizontal swing high resistance

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Overview of the EUR/USD pair. July 16. Donald Trump is once again in conflict with the European Union. Traders expect a "passing"

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: 105.4154

Well, the upward movement of the euro/dollar pair has fully resumed. Now we can talk about it in full voice. It remains only to deal with the question, how long can it last? In principle, in recent months, the European currency has clearly dominated the US dollar. There are several reasons for this, starting with the political and social crisis in the United States, ending with an epidemiological crisis that can further worsen the economic one. In Europe, however, everything has been quiet lately. The economic recovery is proceeding as usual, there are no new serious outbreaks of the epidemic, and only the upcoming EU summit, which will decide on a very important issue regarding the formation of a 750 billion euro economic recovery fund, raises concerns. If the issue is resolved positively, the euro currency may receive additional market support and continue its strengthening in pair with the US currency. As we have repeatedly written, in 2020, the US dollar lost its unconditional advantage over its competitors, so we can now expect a prolonged upward trend for the euro.

Macroeconomic statistics on Wednesday, July 15, was the minimum number in the European Union and in the United States. More precisely, only one report – US industrial production for the month of June. However, despite exceeding forecasts (+5.4% vs. +4.3% m/m), the US dollar did not receive any support from market participants, which once again allows us to conclude that macroeconomic statistics are not very important for traders at this time. As we said earlier, the overall fundamental background is much more important now. And it is this fundamental background that pushes and can continue to push the pair north. In principle, there are several current topics.

1) The political crisis, the presidential election, the confrontation between Donald Trump and Joe Biden.

2) The epidemiological crisis, the confrontation between Donald Trump and Anthony Fauci.

3) The crisis in relations with China, the "Hong Kong issue", the crisis in the South China sea.

Any aggravation of any crisis can lead to the fact that the US dollar will continue to fall in price in pair with the euro, and the technical picture very clearly indicates the current trend and its direction, allowing you to work out fundamental data.

Meanwhile, in the European Union, the EU summit will be held this week, which can provide a lot of important and unexpected information. Today, it is also planned to summarize the results of the ECB meeting, as well as the decision of the regulator on rates. However, we believe that the July meeting will be frankly transitory. It is unlikely that the European regulator will change rates or expand the quantitative stimulus program or the program to counter the pandemic (PEPP). Just at the previous meeting, the ECB had already expanded the PEPP program by 600 billion euros and extended its duration. Thus, it is unlikely that the ECB will make such serious decisions for two months in a row. Thus, from our point of view, the most interesting comments may be made by ECB representatives regarding the future possible steps of the regulator. At the same time, we believe that they will limit themselves to general expressions in the style of "the regulator will do whatever it takes to stabilize the situation". In addition to this event, tomorrow the United States will publish a report on retail sales for June, which may grow by 5% compared to May, and another report on applications for unemployment benefits, which is no longer extremely important. However, we believe that data from overseas will again be ignored by market participants.

At the same time, US President Donald Trump returned to one of his mantras, which has not been repeated for a very long time. The leader of the American nation said on July 14 that "the European Union was created to use the United States". According to the US President, "the EU has always used the US, but other presidents had no idea about it". "Our relations with the EU are very good, they just treat us badly in trade. They have been very unfair to us for many, many decades," Trump concluded. Also on Tuesday, July 14, Donald Trump signed the law "on the autonomy of Hong Kong", which provides for the introduction of sanctions against officials and financial institutions that contribute to the abolition of the autonomy of the Hong Kong district. Recall that this is the second package of sanctions against China in the past week. The first concerned the "Uyghur question" - the issue of oppression of Uyghurs in the Xinjiang region. The first time China responded with mirror sanctions, it is likely to be the second time as well. Thus, as we can see, relations between Beijing and Washington are only getting worse.

The topic of future presidential elections in the United States was not left without news. Donald Trump said on July 15 that he has an excellent chance of re-election in November. "We have excellent poll results," Trump said. "We mean real polls, not those published by the false media." The US leader also said that in 2016, "it was the same" - many media outlets published studies according to which Trump should have lost. The US President said that he expects the support of the "silent majority". "We have never had such an election in which such different candidates are represented," Trump summed up, not forgetting to once again criticize his main opponent in the election, Democrat Joe Biden. "Biden, if he wins the election, will return the United States to the Paris climate agreement, which will deal a serious blow to the American energy industry," Trump said. "He wants to destroy the American energy industry!" After such statements, one can't recall the study of The Washington Post, according to which Trump misled or lied in his statements over the entire presidential term more than 20,000 ...

In general, everything is still the same in the United States, and this "everything" prevents the US dollar from getting more expensive. In principle, the dollar has been growing for a long time in pair with the euro, so a change in the global trend would be logical. From a technical point of view, all trend indicators are directed upwards, indicating an upward trend. Thus, before the reversal of the Heiken Ashi indicator, even a correction is quite difficult to count on. The results of the EU summit will be known only at the weekend, so this week we do not expect a strong fall in the euro currency. In any case, we do not expect a strong decline in the European currency until the pair's quotes close below the moving average line.

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The volatility of the euro/dollar currency pair as of July 16 is 75 points and is characterized as "average". We expect the pair to move today between the levels of 1.1333 and 1.1483. Turning the Heiken Ashi indicator upward will signal the end of the downward correction cycle.

Nearest support levels:

S1 – 1.1353

S2 – 1.1230

S3 – 1.1108

Nearest resistance levels:

R1 – 1.1475

R2 – 1.1597

R3 – 1.1719

Trading recommendations:

The EUR/USD pair resumed the formation of an upward trend. Thus, it is now again recommended to trade for an increase with the goals of 1.1475 and 1.1597. It is recommended to open long positions after the reversal indicator Heiken Ashi upward. Sell orders are recommended to be considered no earlier than fixing the pair below the moving average line with the first goal of 1.1230.

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Forecast for EUR/USD on July 16, 2020

EUR/USD

The euro reached the growth target level of 1.1420 on Wednesday and slightly fell short of the second level of 1.1465, but since we have a target price range of 1.1420/65 in general, the necessary condition for forming a divergence with the Marlin oscillator is met. Only time will tell whether the divergence will take place today, or if the price overcomes 1.1465 with a further increase to 1.1560. A decisive turn down will be signaled by the price moving below the level of 1.1349 – this is the high on June 23.

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The Marlin divergence did not form on the four-hour chart, but instead the signal line of the oscillator created a rectangular range, now the line moves to its lower border, which coincides with the zero line, beyond which the territory of the bears begins.

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Visually, the Marlin signal line can go down from the rectangle at the euro price of 1.1375. The signal level of 1.1349, defined on the daily scale chart, on H4 corresponds to the support of the MACD line, which it is currently striving for.

The price falling to 1.1375 will be a signal for its attack at 1.1349, and a decrease at 1.1349 will open the target at 1.1265 and later 1.195. An increase in the price above 1.1465 can bring the price up to 1.1560.

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Forecast for AUD/USD on July 16, 2020

AUD/USD

The Australian dollar rose by 32 points on Wednesday, even closer to the target level of 0.7080 (July 2019 high), after which a triple divergence can form with the Marlin oscillator – a very strong and rarely seen reversal pattern. Marlin's signal line in the zone of positive numbers.

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The price could not stay above the signal level of 0.7000 on the four-hour chart, it is below it at the moment. But at the same time, the price is higher than both balance and MACD indicator lines and Marlin is in the growth zone, which is a stronger condition for continuing price growth. The price transitioning under the MACD line (0.6966) will cause Marlin to leave the negative zone, and will also contribute to a deeper decline to 0.6900.

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But this decline will also be corrective. Consolidating under this level can become the first condition for further medium-term decline.

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Forecast for USD/JPY on July 16, 2020

USD/JPY

Yesterday, the yen attacked the MACD line from top to bottom in exactly the same way as it did on July 10 (Friday). Accordingly, history can repeat itself with growth on the model of July 13 (Monday), although there are also differences on the smaller-scale chart that reduce the probability of repeating the previous scenario. The current situation is neutral on the daily-scale; the price is under the trend line and above the MACD line – in this narrow range. Marlin gravitates to a fall.

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The price is lower than the balance and MACD indicator lines on the four-hour chart, the balance line looks stronger than it was on the 10th, and the Marlin oscillator line entered the zone of negative values from top to bottom, which gives it more impetus to decline further.

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Thus, consolidating the price below the MACD line on the daily scale is the main scenario now. A drop in the price below the signal level of 106.65 (July 10 low) will strengthen the price's desire to support the price channel around the 105.68 (daily) mark.

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AUDUSD Showing head and shoulders! Drop incoming!

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Trading Recommendation

Entry: 0.69950

Reason for Entry: Head and shoulders neckline, Moving average resistance

Take Profit: 0.69653

Reason for Take Profit: 61.8% Fibonacci retracement

Stop Loss: 0.70146

Reason for Stop Loss: Ascending trendline resistance

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USDCAD approaching 1st support, possible bounce!

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Trading Recommendation

Entry: 1.3488

Reason for Entry: Horizontal swing low support

Take Profit :1.3544

Reason for Take Profit: Horizontal pullback resistance

Stop Loss:1.3425

Reason for Stop loss: 200 fib retracement

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Analytics and trading signals for beginners. How to trade GBP/USD on July 16? A plan to open and close deals on Thursday

The hourly chart of the GBP/USD pair

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Everything is somewhat more complicated with the GBP/USD pair than it is with EUR/USD. News and reports, when viewed together, give different signals. The market does not take into account some reports and news at all, so they need to be filtered out. From the latest news, we note the weak UK GDP for the month of May, which grew by just 1.8% compared to April 2020. However, before that (in March and April) Britain's GDP was contracting by double digits, so after this fall, growth of 1.8% - this is nothing and can not be considered a strong value. Industrial production in Britain has fallen by 20.0% compared to May 2019 and this is a huge failure. Industrial production is an extremely important report for the economy of any country, since most of the GDP consists of production. The lower production and GDP, the worse the country's economy is. Accordingly, it is more difficult to expect the growth of the national currency. However, things are also so-so in America. The problems are the same – economic. However, in addition to them, there are also epidemiological problems with the coronavirus. Every day in the United States, 50-60 thousand people are reported to be infected, which can't help but affect the country's economy. Thus, the dollar can't be in high demand now either. However, the pound/dollar pair will still have to move in some direction. And technical analysis will help us figure out which one.

Technical analysis tells us that the pair failed to continue its growth above the 1.2665 level. Three attempts to continue the upward movement were made on July 7, 9, and 13, but all were unsuccessful. Thus, we have built a downward trend line (one of the main tools for determining the trend), which just shows that in the near future we can expect quotes to fall. The important support level of 1.2573 (the level from which the price can most likely rebound, but if it consolidates below, it will be a signal to sell) does not allow the price to go below itself yet. Based on these technical constructions there are two possible scenarios:

1) If the pair is fixed below the level of 1.2573 (closing the bar below this level at the end of the hour), then sell with the goal of 70 points down. In other words, we place the Take Profit order near the 1.2475 level.

2) If the pair closes above the trend line at the end of the next hour (we assume that this may happen around the level of 1.2665), this will be a buy signal. In this case, we recommend buying the pair, and you can take the profit around the 1.2735 level manually, or by placing a Take Profit order (after reaching a certain price level, the transaction will close in profit itself). Each day, the pair usually travels the same distance (an indicator of the pair's volatility). At this time, from the lowest to the highest price of each day, the pair passes approximately 90-110 points (more volatile than the EUR/USD pair). Therefore, both targets are set at a safe distance from the intended entry points.

Beginners that trade in the forex market should remember that each transaction cannot be profitable. The development of a clear strategy and money management are the key to success in trading for a long period of time.

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

Analytics and trading signals for beginners. How to trade the EUR/USD currency pair on July 16? A plan to open and close

The hourly chart of the EUR/USD pair

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First of all, you need to understand the news and economic reports. This type of forex market analysis can affect the movement of a currency pair in the first place. At this time, the US dollar is not confident when the second wave of the coronavirus has swept America. There are very few buyers of the dollar right now. This is because traders are afraid of the negative impact of the coronavirus on the US economy. As you know, the economy and the exchange rate of the national currency are closely linked. The stronger the economy, the more money is invested in it, the stronger the demand for the national currency. And demand, as you know, has a positive effect on the value of the currency. Few people want to buy the dollar since the coronavirus pandemic can seriously weigh on the American economy. The US government is doing everything possible to mitigate the negative effect, but the epidemic, quarantine and crisis are things that "kill" jobs, the desire of the population to work, and not just to receive unemployment benefits. As a result, the more people who are sick and are just afraid of getting sick, the fewer people who work, lead active lives, and earn and spend money, respectively. And if money is not earned or spent, then the economy is worth it. The government has to pour huge amounts of money into supporting businesses and paying unemployment benefits. But money doesn't come out of nowhere. The US budget deficit is huge. Thus, we would say that the news factor speaks in favor of the euro's growth.

Technical analysis also suggests that the euro currency will continue to increase in price (the upward movement on the chart is the euro's growth (appreciation), while the downward movement on the chart is the growth (appreciation) of the US dollar. This is evidenced by the ascending channel (red lines), within which the euro/dollar pair is traded. Thus, it is possible that today, on July 16, the pair's quotes will remain inside this channel and will not be able to exit it through its lower line. And if this does not happen, then further downward movement will be delayed for quite some time. Here are two possible versions of events:

1) If the pair touches the lower border of the channel, but cannot close lower (closing the bar below the channel line at the end of the hour), then buy with the goal of 50-60 points up. That is, after 50-60 points, we place a Take Profit order.

2) If the pair closes below the channel at the end of the next hour (we assume that this could happen near the level of 1.1385), this will be a sell signal. In this case, we recommend selling the pair, and placing Take Profit orders near the targets - the levels of 1.1325, 1.1301, 1.1256. The safest goal is the first one. During the same day, the pair usually goes the same distance (volatility). At this time, from the lowest to the highest price of each day, the pair passes approximately 75-80 points. The first goal is approximately 60 minutes away, so when it is reached, we advise you to take profit and exit the deal.

Beginners that trade in the forex market should remember that each transaction cannot be profitable. The development of a clear strategy and money management are the key to success in trading for a long period of time.

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

Hot forecast and trading signals for the GBP/USD pair for July 16. COT report. Macroeconomic data and 1.2668-1.2688 area

GBP/USD 1H

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The GBP/USD pair, unlike the EUR/USD pair, is just trying to continue the upward trend. Buyers reached the resistance area of 1.2634-1.2660 for the fourth time in the last few days and unsuccessfully tried to overcome it. Another rebound and correction to the critical Kijun-sen line. However, it was also not possible to gain a foothold below the Kijun-sen line, so at the moment everything looks as if the bulls will make a fifth attempt to go above the designated area today. Bears formally have a good chance of moving down, since the pair's quotes came out of the ascending channel. However, they will need a new fixation under the critical line to expect a fall to the Senkou Span B line. There is no question of a stronger growth of the US dollar now.

GBP/USD 15M

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Both linear regression channels are directed upwards on the 15-minute timeframe, thus signaling that there is no correction. Thus, it is extremely important for buyers to stay above the Kijun-sen line in order for the upward movement to continue. The latest COT report fully reflects the essence of what is currently happening on the currency market for the pound/dollar pair. Professional traders opened 6,743 Buy-contracts and a total of 12 Sell-contracts during the reporting week. Obviously, they were interested in the pound. The total net position in the commercial category increased by 6,700. The total number of contracts in the category of commercial traders is approximately 115,000, and the preponderance of Buy over Sell was -21 thousand before the last report. Thus, +6,700 in the net position is a serious strengthening of the bullish mood. The British currency fell in price in the first two trading days of the week, but showed a strong growth on Wednesday, thus offsetting all fears about a change in the trend among professional traders, which drive the market.

The fundamental background for the GBP/USD pair has not changed much in recent days. For the first time in a long time, several macroeconomic reports were published at once in the UK, which, I must say, disappointed traders. The biggest disappointment was GDP, which grew by only 1.8% in May. The remaining indicators were generally in line with the forecasts and expectations of traders. Today we are waiting for publications on changes in average wages, as well as on applications for unemployment benefits and the unemployment rate. All forecasts indicate a deterioration in the values of these indicators, which could potentially lower demand for the British pound on July 16. In conjunction with the fact that the pound/dollar pair failed to update the previous three local highs, we believe that the probability of a decline in the pound's quotes is quite high today. As for the prospects for the pound, they are about as vague as in the case of the US dollar. Therefore, we believe that it is more appropriate to trade the pair in the short term. The overall fundamental background is more important for traders now, but do not forget that it is equally bad in both the UK and the US. There is no news on the negotiations between London and Brussels at the moment. Boris Johnson has not yet visited Brussels, so there is no reason for optimism among buyers of the pound now either.

There are two main scenarios as of July 16:

1) The bullish outlook worsened in the first half of the new trading week. At this time, the pair's purchases are temporarily not relevant, as quotes have gone below the rising channel. Thus, we recommend buying the British pound again, but not before overcoming the resistance area of 1.2634-1.2660. The targets in this case are resistance levels 1.2705 and 1.2791. Potential Take Profit in this case will be from 30 to 110 points.

2) Sellers are advised to resume trading on a lower level with targets at support level 1.2497, Senkou Span B line (1.2458) and support level 1.2375 if the pair overcomes the Kijun-sen line (1.2573). Today's reports from the UK can help the pair by pulling it down, as information is unlikely to turn out optimistic. Potential Take Profit range from 60 to 180 points.

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

Hot forecast and trading signals for the EUR/USD pair on July 16. COT report. US introduced new sanctions against China due

EUR/USD 1H

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The euro/dollar pair reached the second resistance level of 1.1432 and rebounded from it on the hourly timeframe of July 15. We have already said that the pair is very often corrected within the current movement, so it is not surprising that a new round of corrective movement has begun. Buyers have significantly improved their positions over the past few days and are now trading near the upper line of the ascending channel. Overcoming the level of 1.1432 will most likely lead to continuing the upward movement. Sellers have nothing to oppose now. They are waiting for the bulls to retreat and the pair to consolidate below the ascending channel and the Kijun-sen line.

EUR/USD 15M

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Both linear regression channels are still pointing up on the 15-minute timeframe, signaling an upward trend in the most short-term. There are no signs of the beginning of a new corrective movement at the moment. The latest COT report from July 7 was not informative, however, it provided answers to our questions. The most important category of large traders, commercial, which represents professionals who trade on the currency market for the purpose of commercial profit, opened almost 6,000 Buy-contracts and only 1,700 Sell-contracts. Thus, the net position in this category has increased by almost 4,000, which, simply put, means that the bullish mood of major players has increased. At the same time, the total number of Buy-contracts for professional traders is also much higher than the number of Sell-contracts – 186,000 against 80,000. The general conclusion is simple: professional traders are still focused on buying the European currency. This hypothesis is still fully confirmed in technical terms.

The fundamental background for the EUR/USD pair remained unchanged on Wednesday. The only macroeconomic report on industrial production in the US caused the dollar to slightly strengthen, although, given the nature of the euro/dollar pair's movement in recent weeks, there is great doubt that the quotes fell because of this report. Traders still attach more importance to the overall fundamental background, which is still not in favor of the US dollar. One of the most important topics for the greenback was developed yesterday. US President Donald Trump signed two decrees at once, united in one law "on the autonomy of Hong Kong". The first decree concerned the removal of all trade preferences in Hong Kong, which now makes this district, in fact, just part of China, against which the general US sanctions and duty policy will apply. The second decree provides for the imposition of sanctions against officials and legal entities who are responsible for the loss of Hong Kong's autonomy status. Trump himself said: "Hong Kong, in my opinion, will no longer be able to compete with free markets. I suspect many people will leave the city." Beijing, of course, will not sit idly by and is already preparing retaliatory sanctions against Washington. "Hong Kong's affairs are exclusively China's internal affairs, and no foreign state has the right to interfere. Washington's plan to prevent the implementation of the national security law in Hong Kong will never be successful. To protect its legitimate interests, China will give the necessary response and impose sanctions on relevant individuals and organizations in the United States," the Chinese foreign ministry said in an official statement.

Based on the foregoing, we have two trading ideas for July 16:

1) Buyers continue to dominate the market, so we just need to wait for a new buy signal. The trend remains unambiguously upward, but still do not forget about the frequent pullbacks and corrections, which are now inherent in the euro/dollar pair. You are advised to open new long positions with the target at the resistance level of 1.1494, if traders re-consolidate the pair above the level of 1.1432. Potential Take Profit in this case is about 55 points.

2) The bears have not been able to cross the Senkou Span B line, the Kijun-sen line, or leave the channel over the past few days. Sellers do not have enough power to form a new downward trend at this time, and reaching corrections is an unrewarded task. Thus, we recommend selling the euro, but not before overcoming the Kijun-sen line, and ideally after closing below the ascending channel, with the goal of Senkou Span B line (1.1278) and the support level of 1.1238. Potential Take Profit in this case is from 40 to 80 points.

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