Technical Analysis of GBP/USD for August 12, 2020:

Technical Market Outlook:

The GBP/USD pair keeps trading in a narrow horizontal range located between the levels of 1.3047 - 1.3100 as the volatility dries up. There is so far no indication of any bearish pressure and all the sideway price action looks like a typical correction in an up trend. The key technical support is seen at the level of 1.2979, so as long as the market trades above it, the odds for another wave up are high. Any breakout above the local high at 1.3121 might accelerate the rally towards the level of 1.3169.

Weekly Pivot Points:

WR3 - 1.3353

WR2 - 1.3261

WR1 - 1.3146

Weekly Pivot - 1.3060

WS1 - 1.2937

WS2 - 1.2860

WS3 - 1.2735

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 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).

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Technical Analysis of EUR/USD for August 12, 2020:

Technical Market Outlook:

The EUR/USD pair has fell out of the main ascending channel and made a new local low at the level of 1.1711. Any violation of this level will only deepen the correction towards the next key technical support seen at the level of 1.1655. The momentum is below the fifty level, but the market is trying to bounce from the oversold conditions, so odds for local wave up are quite high. The nearest technical resistance is seen between the levels of 1.1790 - 1.1813. The weekly time frame trend is still up.

Weekly Pivot Points:

WR3 - 1.2109

WR2 - 1.2010

WR1 - 1.1819

Weekly Pivot - 1.1788

WS1 - 1.1633

WS2 - 1.1672

WS3 - 1.1572

Trading Recommendations:

The EUR/USD pair confirmed the up trend, so all pull-backs and corrections should be used to accumulate the EUR. The next targets in the long-term are seen at the levels of 1.2000 - 1.2089. There is no indication of any bigger correction to come, so all the dips should be bought until the level of 1.1347 is clearly violated.

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Technical Analysis of BTC/USD for August 12, 2020:

Crypto Industry News:

The financial regulator in Russia is developing a new cryptocurrency analysis tool to track major cryptocurrencies such as Bitcoin and privacy-oriented coins.

Russia's Federal Financial Monitoring Service, the federal anti-money laundering and terrorist financing service, is reportedly planning to build a new analytical platform to track cryptocurrency transactions using artificial intelligence.

The new system, dubbed "Transparent Blockchain," is designed to track the movement of digital financial assets and identify cryptographic service providers to combat illegal digital asset activity, local news agency RBC reported.

According to the report, the new system is able to "partially reduce the anonymity" of transactions involving major coins such as Bitcoin, Ethereum, Omni, as well as privacy-focused cryptocurrencies such as Dash and Monero.

The Financial Supervisory Authority successfully piloted a prototype system to combat drug trafficking. The system was developed in cooperation with a large Russian research institute, the Institute of Physics. Lebedev of the Russian Academy of Sciences, the report reads.

The project has reportedly been financed from extra-budgetary funds so far, but would require additional funding. According to preliminary data, the Russian "Transparent Blockchain" will require approximately 760 million rubles ($ 10.3 million) from the federal budget from 2021 to 2023. The target customers of the new platform are reportedly expected to include large financial institutions such as the Russian central bank.

Technical Market Outlook:

The BTC/USD pair has broken below the short-term trend line and made a new local low seen at the level of $11,063. The momentums has decreased and now is seen below the fifty level. The key short-term support is still located at the level of $10,940 - $10,890, so for now all the price action is being considered as sideway trend that might turn into a correction. The weekly time frame trend is still up and in a case of a breakout above the level of $12,035, the next target for bulls is seen at the level of $12,269.

Weekly Pivot Points:

WR3 - $12,981

WR2 - $12,405

WR1 - $12,075

Weekly Pivot - $11,487

WS1 - $11,099

WS2 - $10,537

WS3 - $10,124

Trading Recommendations:

Due to the level of $12,000 violation, the Bitcoin is now in the up trend on the long-term time frame. The next key target for bulls is seen at the level of $13,712 and $15,000. The key long-term technical support is located at the level of $7,897, but the zone around $9,500 - $10,500 is an important technical support as well.

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Technical Analysis of ETH/USD for August 12, 2020:

Crypto Industry News:

The metals and minerals trading subsidiary of Mitsubishi Corporation, Mitsubishi Corporation RtM Japan Ltd, has launched a Blockchain platform called ECO for precious metals trading.

The platform, developed by Mitsubishi in cooperation with the American company Blockchain Skuchain, is based on Skuchain's EC3 platform for supply chain management and finance based on Blockchain.

According to the official announcement, ECO will facilitate the trade of metals between contractors by generating, managing and executing invoices and transaction confirmations.

Initially, Mitsubishi will only bring its "most valued customers" to the platform, but plans to extend and implement ECO soon to cover most of its supply chain system. By using the ECO platform, traders will be able to sign commercial documents and upload them to Blockchain. They will then be able to share the signed documents with others in real time and hide any sensitive business information that they do not want to disclose.

The company said it will add more features to ECO in the future to address other key supply chain challenges in the metals trading industry.

Technical Market Outlook:

The ETH/USD pair has broken below the short-term trend line support located around the level of $390 and made a local low at the level of $365 at the time of writing the analysis. This level is very close to the techncal support seen at the level of $362.60, but the key short-term support is still located at the level of $323.87- $323.85. The momentum has decreased as well, so the correction might extend lower. The weekly time frame trend is still up.

Weekly Pivot Points:

WR3 - $458.63

WR2 - $430.13

WR1 - $411.58

Weekly Pivot - $386.08

WS1 - $366.85

WS2 - $340.34

WS3 - $321.13

Trading Recommendations:

Due to the violation of the level of $351, Ethereum is now in the up trend on the long-term time frame. The next target for bulls is seen at the level of $500. The key long-term technical support is located at the level of $86.10, but the zone around $300 - $308 is an important technical support as well.

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Hot forecast and trading recommendations for GBP/USD on 08/12/2020

Despite the inadequacy of the recent data on the UK labor market, as well as the dollar still being oversold, speculative interest in the market still persists. The pound began to grow again following the release of unemployment data, although statistics indicated a completely different direction of movement. Apparently, this is how speculators prepared for the data on producer prices in the United States, playing so to speak from the opposite. The forecasts for producer prices were quite good.

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It was expected that producer prices will rise by 0.3% over the month, and the rate of their decline will slow down from -0.8% to -0.7% in annual terms. In fact, it turned out that prices increased by 0.6%. If you look at the annual data, the rate of decline has slowed down from -0.8% to -0.4%. And this turned out to be enough for the dollar to instantly win back all its losses, and could even strengthen by a little. Whatever one may say, but producer prices are a leading indicator for inflation. So there can be no talk of any reduction in inflation. Rather, it is just right to talk about its stronger growth.

Producer Price Index (United States):

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And although the main event of the day is US inflation, you still can not ignore the data on GDP and industrial production in the UK. Moreover, they turned out to be slightly better than forecasts. Thus, a preliminary estimate of GDP for the second quarter showed an acceleration in the pace of economic decline from -1.7% to -21.7%. And it doesn't matter that the scale of the decline is simply catastrophic. The economy was expected to lose about 23.0%. So the data is a little better. The industry is still more optimistic, as the rate of its decline was supposed to slow down from -20.0% to -14.0%, but it turned out that they slowed down to -12.5%. In other words, despite the horrific numbers, the UK statistics were slightly better than expected.

GDP growth rate (UK):

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It is clear that all this caused the pound to strengthen. After all, the data came out better than expected. However, most likely, we will see a repetition of yesterday's picture, and the dollar will confidently strengthen after the US session opens. Moreover, there is a high probability that the dollar's appreciation will be much more extensive than yesterday. Investors expect inflation in the United States to accelerate from 0.6% to 0.7%, which in itself is an extremely positive factor. However, yesterday's data on producer prices indicate that inflation may rise even more. And in this case, the dollar's appreciation will be more pronounced.

Inflation (United States):

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The GBPUSD pair has been following the 1.3000/1.3190 side band for the second week, consistently reaching the boundaries. The current dynamics indicate that the inertial upward movement that took place on July 1 is considered completed. Forming a flat is a temporary phenomenon in the market, and as soon as the borders fall, we will see the structure of the main course. Regarding volatility, speculation has decreased with the arrival of a sideways movement, but they still take place in the market, and the daily dynamics is high.

Looking at the trading chart in general terms, the daily period, you can see the natural basis that comes from the beginning of 2020, where the 1.3000/1.3250 area played the role of trading forces interacting on the market.

We can assume that as long as the 1.3000/1.3190 border is not broken, the quotes will continue the process of successive workouts, according to the rebound principle. The main tactic in the market is the method of breaking the established boundaries, and if you refer to the oversold dollar, then consolidating the price below 1.3000 can lead to a change in the sideways movement to a downward movement towards the values of 1.2900-1.2885.

From the point of view of complex indicator analysis, we see that the indicators of technical instruments at minute and hour intervals signal sales. Daily intervals, as before, are focused on the main inertia of the price, signaling a purchase.

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Pound believes the rumors

Everything is relative. Due to the large number of deaths from COVID-19, the severity and duration of the lockdown and the "social face" of the British economy will sink deeper than its American or European counterparts, but it will recover faster in 2021, this is according to the Bank of England. GDP will not rise to pre-crisis levels before the end of next year. However, who said that it is easy for others now? The optimism of Andrew Bailey and his colleagues inspired the pound, but the US labor market report for July quickly restrained the buyers of GBP/USD.

The fact that the markets live in the future, and investors are actively buying rumors, could be convinced more than once in 2020. US stock indices are about to recover to the levels that took place before the pandemic, and they will most likely rewrite historical highs on the expectations of V- figurative recovery of the US economy. Yes, the chances of such a scenario are currently small, but still. To the surprise of the dollar bears, employment outside the agricultural sector is growing for the third month in a row, which looks like a pleasant surprise amid a sharp increase in the number of coronavirus infected in July.

The pound is no exception. Yes, Britain found itself in a deeper hole (according to BoE forecasts, GDP will decline by 9.5% by the end of this year) than the eurozone (-8%) or the United States (-5.75%), but the return of the economy of Britain to the trend appears to be faster than its main competitors to the Central Bank.

Forecasts for GDP

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The pound reacted positively to the Bank of England's announcement of a reduction in QE asset purchases from£6.9 billion to £4.4 billion a week from August 11, as well as to Andrew Bailey's phrase that there is currently no need to use negative interest rates, as they are likely to reduce the desire of banks to lend to the economy. Until the last meeting of the MPC, the futures market put a drop in the REPO rate below zero in the first half of 2021 in the quotes of its instruments. If the BoE is not going to do this, then this is good news for the pound. However, the bears were not particularly convinced. According to City, the fact that the regulator did not say anything about the lower limit of borrowing costs indicates that they will collapse into a negative zone in the future.

Interestingly, Reuters experts believe that monetary policy will fade into the background in the near future, and the pound will fall under the influence of Brexit. The consensus forecast assumes a decline in the GBP/USD quotes to 1.29 and 1.28 in 3 and 6 months with a subsequent recovery to 1.31 in a year. In my opinion, Boris Johnson will be able to find a common language with the EU. Its minister, Michael Gove, notes that the language of the European Union has recently changed, which makes it possible to count on the signing of an agreement.

This week, investors' attention will be focused on the release of data on the British labor market and GDP. If Britain's economy did not sink as deeply as Reuters predicts in the second quarter, it will serve the pound well. It makes sense to use the GBP/USD pullbacks to support at 1.3, 1.2955 and 1.288 for purchases.

Daily chart of GBP/USD

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Fractal analysis for major currency pairs on August 12, 2020

Forecast for August 12:

Analytical overview of currency pairs on the H1 scale:

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The key levels for the euro / dollar pair on the H1 scale are: 1.1915, 1.1853, 1.1800, 1.1768, 1.1733, 1.1693, 1.1629, 1.1588 and 1.1526. Here, the price is forming a potential for the downward movement from August 6th. A consolidated movement is expected in the range of 1.1733 - 1.1693. The breakdown of the last value should be accompanied by a pronounced downward movement. In this case, the target is 1.1629. Price consolidation is in the range of 1.1629 - 1.1588. For the potential value for the bottom, we consider the level of 1.1526. Upon reaching which, we expect an upward pullback.

A short-term upward movement is possible in the range of 1.1768 - 1.1800. The breakdown of the last value will lead to a deep correction. Here, the target is 1.1853. This is the key support level for the downward structure from August 6.

The main trend is the descending structure from August 6

Trading recommendations:

Buy: 1.1768 Take profit: 1.1800

Buy: 1.1804 Take profit: 1.1850

Sell: 1.1733 Take profit: 1.1700

Sell: 1.1690 Take profit: 1.1630

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The key levels for the pound / dollar pair on the H1 scale are: 1.3185, 1.3108, 1.3066, 1.2997, 1.2943, 1.2873, 1.2824 and 1.2764. Here, we are following the formation of the downtrend structure from August 6th. A short-term downward movement is expected in the range of 1.2997 - 1.2943. The breakdown of the last level should be accompanied by a pronounced downward movement. Here, the target is 1.2873. There is a short-term downward movement and consolidation in the range of 1.2873 - 1.2824. For the potential value for the bottom, we consider the level of 1.2764. Upon reaching which, we expect an upward pullback.

A consolidated movement is possible in the range of 1.3066 - 1.3108. The breakdown of the last value will encourage the formation of an upward structure. In this case, the potential target is 1.3185.

The main trend is the formation of a descending structure from August 6

Trading recommendations:

Buy: 1.3066 Take profit: 1.3106

Buy: 1.3110 Take profit: 1.3185

Sell: 1.2997 Take profit: 1.2945

Sell: 1.2940 Take profit: 1.2873

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The key levels for the dollar / franc pair on the H1 scale are: 0.9308, 0.9268, 0.9240, 0.9199, 0.9150, 0.9117, 0.9090 and 0.9047. Here, we are following the bullish structure on August 5. The continuation of the upward movement is expected after the breakdown of the level of 0.9200. In this case, the target is 0.9240. There is a short-term upward movement, as well as consolidation in the range of 0.9240 - 0.9268. We consider the level 0.9308 as a potential value for the top. Upon reaching which, we expect consolidation, as well as a downward pullback.

A short-term downward movement is possible in the range of 0.9150 - 0.9117. The breakdown of the last value will lead to a deep correction. Here, the target is 0.9090. This is a key support level for the upward structure.

The main trend is the upward structure from August 5

Trading recommendations:

Buy : 0.9200 Take profit: 0.9240

Buy : 0.9243 Take profit: 0.9265

Sell: 0.9150 Take profit: 0.9120

Sell: 0.9116 Take profit: 0.9090

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The key levels for the dollar / yen pair on the scale are : 108.70, 107.99, 107.51, 106.79, 106.19, 105.61 and 105.33. Here, we are following the upward cycle from July 31. The continuation of the upward movement is expected after the breakdown of the level of 106.80. In this case, the target is 107.51. Price consolidation is in the range of 107.51 - 107.99. For the potential value for the top, we consider the level 108.70. Upon reaching which, we expect consolidation, as well as a downward pullback.

The level of 106.19 is a key support for the top and its breakdown will lead to the development of a correction. In this case, the target is 105.61. The range of 105.61 - 105.33 is the key support.

The main trend is the upward cycle on July 31

Trading recommendations:

Buy: 106.80 Take profit: 107.50

Buy : 107.53 Take profit: 107.95

Sell: 106.19 Take profit: 105.65

Sell: Take profit:

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The key levels for the Canadian dollar / US dollar pair on the H1 scale are: 1.3511, 1.3477, 1.3422, 1.3380, 1.3318, 1.3285 and 1.3230. Here, the price forms a potential for the upward movement from August 5th. The continuation of the upward movement is expected after the breakdown of the level of 1.3380. In this case, the target is 1.3422. There is consolidation near this level. The breakdown of the level 1.3424 will lead to a pronounced upward movement. Here, the target is 1.3477. We consider the level of 1.3511 as a potential value for the top. Upon reaching which, we expect consolidation, as well as a downward pullback.

A short-term downward movement is possible in the range of 1.3318 - 1.3285, hence the probability of an upward reversal is high. The breakdown of the level of 1.3285 will encourage the formation of a local downward structure. In this case, the potential target is 1.3230.

The main trend is the upward structure from August 5, the stage of deep correction

Trading recommendations:

Buy: 1.3380 Take profit: 1.3420

Buy : 1.3424 Take profit: 1.3475

Sell: 1.3318 Take profit: 1.3287

Sell: 1.3283 Take profit: 1.3235

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The key levels for the Australian dollar / US dollar pair on the H1 scale are : 0.7247, 0.7196, 0.7157, 0.7135, 0.7108, 0.7071, 0.7044, 0.7008 and 0.6984. Here, we are following the development of the descending structure from August 6th. The continuation of the downward movement is expected after the breakdown of the level of 0.7108. In this case, the target is 0.7071. Price consolidation is in the range of 0.7071 - 0.7044. For the potential value for the bottom, we consider the level of 0.6984. Upon reaching which, we expect a consolidated movement in the range of 0.7008 - 0.6984, as well as an upward pullback.

A short-term upward movement is possible in the range of 0.7135 - 0.7157. The breakdown of the last value will lead to a deep correction. Here, the target is 0.7196. This is the key support level for the downward structure.

The main trend is the descending structure from August 6

Trading recommendations:

Buy: 0.7135 Take profit: 0.7155

Buy: 0.7157 Take profit: 0.7194

Sell : 0.7106 Take profit : 0.7071

Sell: 0.7069 Take profit: 0.7046

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The key levels for the euro / yen pair on the H1 scale are: 126.32, 125.80, 125.54, 125.11, 124.81, 124.37 and 123.82. Here, we are watching the upward structure from July 24. At the moment, the price has formed a local structure for the top of August 10. The continuation of the upward movement is expected after the breakdown of 125.11. In this case, the first target is 125.54. A short-term upward movement is expected in the range 125.54 - 125.80. The breakdown of the last value will lead to a movement to a potential target of 126.32. Upon reaching which, we expect a downward pullback.

The level of 124.37 is a key support for the top and it's breakdown will encourage the formation of a downward structure. Here, the potential target is 123.82. We expect the formation of pronounced initial conditions for a downward cycle before this level.

The main trend is the upward structure from July 24, local structure for the top from August 10

Trading recommendations:

Buy: 125.11 Take profit: 125.50

Buy: 125.55 Take profit: 125.80

Sell: 124.35 Take profit: 123.90

Sell: Take profit:

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The key levels for the pound / yen pair on the H1 scale are : 141.13, 1407.71, 140.09, 139.59, 138.64, 138.24, 137.79 and 137.29. Here, the subsequent targets for the high have been determined from the local upward structure on August 7. A short-term upward movement is expected in the range 139.59 - 140.09. The breakdown of the last value should be accompanied by a pronounced upward movement. In this case, the target is 140.71. For the potential value for the top, we consider the level 141.13. Upon reaching which, we expect a consolidated movement, as well as a downward pullback.

A short-term downward movement is possible in the range of 138.64 - 138.24. The breakdown of the last value will favor the development of a downward structure. Here, the first target is 137.79. For the potential value for the bottom, we consider the level of 137.29, to which we expect the formation of pronounced initial conditions for a downward cycle.

The main trend is the local structure for the top from August 7

Trading recommendations:

Buy: 139.60 Take profit: 140.05

Buy: 140.10 Take profit: 140.70

Sell: 138.64 Take profit: 138.26

Sell: 138.32 Take profit: 137.80

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COVID-19 again: Dollar grows amid alarming global trends

The dollar index is showing an upward trend again. Since it reached a five-day low yesterday (93.19 points), the indicator turned around and headed towards the 94th figure. The index is gradually growing, but almost without recoil, reflecting the increased demand for the US dollar throughout the market. In turn, the European currency came under pressure from the coronavirus factor, which is now a headache not only for dollar bulls.

In general, the dollar's growth is primarily due to the increase of anti-risk sentiment in the financial markets. The blame is on the coronavirus, which began to gain momentum again in different countries of the world. This problem only narrowed to the US borders at the beginning of summer: the spread of COVID-19 was quite successfully contained in Europe, Australia, New Zealand, China, Japan and in most other developed countries- at least in comparison with the United States. The epicenter of the epidemic shifted to the southern and western states of the US, where tens of thousands of new infections were recorded daily. Some major cities (such as Miami) have tightened quarantine restrictions, jeopardizing the recovery of the US labor market. The coronavirus factor exerted background pressure on the dollar for a month and a half, and has only loosened its grip in recent days.

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To be more precise, traders are now focused on global trends, worried about the recovery of the global economy. The incidence rate is accelerating again. If the number of infected people increased from 5 to 10 million in the period from May to June in almost 40 days, then the threshold of 15 million was overcome much faster - in just three weeks. And in just 19 days, the number of cases in the world has grown from 15 to 20 million. If we consider the indicator of daily growth, then India has become the leader of the anti-rating. It is followed by Brazil, and only then by the United States. The fastest growing epidemiological situation in India - the number of patients increased from one to two million (at the moment - 2.3 million) in just three weeks. Alarming trends continue to be reported in Brazil and generally in Latin America. As for Europe, local outbreaks are still being recorded here (for example, in northeastern Spain). Nevertheless, many EU countries (in particular, France and Greece) have tightened quarantine restrictions. For example, in Paris, as well as in some other French cities, masks need to be worn, including on the street.

This news flow has strengthened anti-risk sentiment, which allowed the dollar to climb. And although the coronavirus kills at least a thousand people every day in the United States, traders in the foreign exchange market focus on global trends. Moreover, the latest US events also supported the greenback.

As you know, US President Donald Trump signed decrees to provide assistance to the US economy over the weekend - in particular, on additional payments to unemployed Americans. Executive decrees were issued bypassing Congress, although congressmen were in charge of government spending. Given the legal doubtfulness of the signed documents, there are speculations on the market that the Democrats will appeal these decrees. But over the past two days, none of the representatives of the Democratic Party have taken concrete steps in this direction. It is likely that the Democrats came to the conclusion that on the eve of the presidential elections, such actions will not bring political points. Whatever it was, the fact remains: at the moment, talk about judicial appeal against presidential decrees has died down again. But negotiations may soon resume in Congress. As Trump tweeted yesterday, "senior Democratic officials have offered to hold a meeting at the White House." If the Democrats and the president come to a common decision, further agreement on the bill on the provision of assistance to the US economy will become a "matter of technicality."

Macroeconomic reports also provided additional support to the dollar yesterday. The producer price index, which is an early signal of a change in inflationary trends, came out in the green zone - both on an annualized and monthly basis (+ 0.6% m/m, -0.4% y/y). The same index, only excluding food and energy prices, also turned out to be better than expected (+ 0.5% m/m, + 0.3% y/y, reflecting the economic recovery.

Today is another test for the dollar: we will find out the key data on the growth of US inflation. According to general forecasts, the general consumer price index in monthly terms should slow its growth to 0.3% in July (compared with 0.6% in June). In annual terms, the indicator should rise to 0.8% (an increase to 0.6% was reported in June). As for core inflation, excluding food and energy prices, indistinct dynamics is also predicted here - slower growth on an annualized basis (1.1%) and a slight increase relative to June in monthly terms (0.3%). If the numbers mentioned come out better than expected, the greenback can continue its ascent, having a corresponding impact on the dollar pairs.

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Speaking directly about the EUR/USD pair, there are two support levels on the horizon. The closest one is at 1.1690 (the middle line of the Bollinger Bands indicator on the daily chart). The next one is a hundred points lower at 1.1590 (Kijun-sen line on the same timeframe). A deeper decline requires good news from Capitol Hill - on the prospects for new stimulus. If US inflation does not meet the expectations of investors, the EUR/USD pair may return to the boundaries of the 18th figure, that is, to the Tenkan-sen line on D1.

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COVID-19 again: Dollar grows amid alarming global trends

The dollar index is showing an upward trend again. Since it reached a five-day low yesterday (93.19 points), the indicator turned around and headed towards the 94th figure. The index is gradually growing, but almost without recoil, reflecting the increased demand for the US dollar throughout the market. In turn, the European currency came under pressure from the coronavirus factor, which is now a headache not only for dollar bulls.

In general, the dollar's growth is primarily due to the increase of anti-risk sentiment in the financial markets. The blame is on the coronavirus, which began to gain momentum again in different countries of the world. This problem only narrowed to the US borders at the beginning of summer: the spread of COVID-19 was quite successfully contained in Europe, Australia, New Zealand, China, Japan and in most other developed countries- at least in comparison with the United States. The epicenter of the epidemic shifted to the southern and western states of the US, where tens of thousands of new infections were recorded daily. Some major cities (such as Miami) have tightened quarantine restrictions, jeopardizing the recovery of the US labor market. The coronavirus factor exerted background pressure on the dollar for a month and a half, and has only loosened its grip in recent days.

analytics5f338abfa8d88.jpg

To be more precise, traders are now focused on global trends, worried about the recovery of the global economy. The incidence rate is accelerating again. If the number of infected people increased from 5 to 10 million in the period from May to June in almost 40 days, then the threshold of 15 million was overcome much faster - in just three weeks. And in just 19 days, the number of cases in the world has grown from 15 to 20 million. If we consider the indicator of daily growth, then India has become the leader of the anti-rating. It is followed by Brazil, and only then by the United States. The fastest growing epidemiological situation in India - the number of patients increased from one to two million (at the moment - 2.3 million) in just three weeks. Alarming trends continue to be reported in Brazil and generally in Latin America. As for Europe, local outbreaks are still being recorded here (for example, in northeastern Spain). Nevertheless, many EU countries (in particular, France and Greece) have tightened quarantine restrictions. For example, in Paris, as well as in some other French cities, masks need to be worn, including on the street.

This news flow has strengthened anti-risk sentiment, which allowed the dollar to climb. And although the coronavirus kills at least a thousand people every day in the United States, traders in the foreign exchange market focus on global trends. Moreover, the latest US events also supported the greenback.

As you know, US President Donald Trump signed decrees to provide assistance to the US economy over the weekend - in particular, on additional payments to unemployed Americans. Executive decrees were issued bypassing Congress, although congressmen were in charge of government spending. Given the legal doubtfulness of the signed documents, there are speculations on the market that the Democrats will appeal these decrees. But over the past two days, none of the representatives of the Democratic Party have taken concrete steps in this direction. It is likely that the Democrats came to the conclusion that on the eve of the presidential elections, such actions will not bring political points. Whatever it was, the fact remains: at the moment, talk about judicial appeal against presidential decrees has died down again. But negotiations may soon resume in Congress. As Trump tweeted yesterday, "senior Democratic officials have offered to hold a meeting at the White House." If the Democrats and the president come to a common decision, further agreement on the bill on the provision of assistance to the US economy will become a "matter of technicality."

Macroeconomic reports also provided additional support to the dollar yesterday. The producer price index, which is an early signal of a change in inflationary trends, came out in the green zone - both on an annualized and monthly basis (+ 0.6% m/m, -0.4% y/y). The same index, only excluding food and energy prices, also turned out to be better than expected (+ 0.5% m/m, + 0.3% y/y, reflecting the economic recovery.

Today is another test for the dollar: we will find out the key data on the growth of US inflation. According to general forecasts, the general consumer price index in monthly terms should slow its growth to 0.3% in July (compared with 0.6% in June). In annual terms, the indicator should rise to 0.8% (an increase to 0.6% was reported in June). As for core inflation, excluding food and energy prices, indistinct dynamics is also predicted here - slower growth on an annualized basis (1.1%) and a slight increase relative to June in monthly terms (0.3%). If the numbers mentioned come out better than expected, the greenback can continue its ascent, having a corresponding impact on the dollar pairs.

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Speaking directly about the EUR/USD pair, there are two support levels on the horizon. The closest one is at 1.1690 (the middle line of the Bollinger Bands indicator on the daily chart). The next one is a hundred points lower at 1.1590 (Kijun-sen line on the same timeframe). A deeper decline requires good news from Capitol Hill - on the prospects for new stimulus. If US inflation does not meet the expectations of investors, the EUR/USD pair may return to the boundaries of the 18th figure, that is, to the Tenkan-sen line on D1.

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

Elliott wave analysis of GBP/JPY for August 12, 2020

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GBP/JPY should soon test the ideal target for blue wave iii at 140.35 from where a minor correction/consolidation closer to 139.10 and maby even closer to 137.92 is expected. Short-term minor support at 138.62 should be able to protect the downside for the expected pop to 140.35 to complete blue wave iii and set the stage for a correction in blue wave iv.

R3: 140.35

R2: 140.00

R1: 139.50

Pivot: 139.08

S1: 138.62

S2: 138.22

S3: 137.27

Trading recommendation:

We are long GBP from 135.43 and we have raised our stop to 137.70 and we will take profit on 50% of our long position at 140.25.

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

Elliott wave analysis of EUR/JPY for August 12, 2020

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EUR/JPY rallied to test short-term resistance at 125.43 but failed to break thought that level. It is likely to set for a second leg lower towards 124.00. Because of the larger than expected rally to 125.50, the second leg may hit 123.78 before the next impulsive rally through the former peak at 125.59 towards 127.23 takes place. In the longer-term, the pair may rise to 129.26.

R3: 125.94

R2: 125.59

R1: 125.32

Pivot: 124.81

S1: 124.55

S2: 124.00

S3: 123.78

Trading recommendation:

We will buy EUR at 124.10 or upon a break above 125.43

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Silver Price Movement For August 12, 2020.

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On the 4 hour chart, we can see that Silver closed below the 27.330 level. The bearish bias is now strong. After Silver has touched the 23.965 level, it seems to be trying to bounce off. If the bulls enter the market, Silver may reach the 24.695 level. This scenario is unlikely to occur if Silver continues to drop and close below the 22.860 level.

(Disclaimer)

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Bitcoin Price Movement On August 12, 2020

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After Bitcoin touched $11,063.80, its price is now trying to move upwards aiming to hit $11,710.80 as the nearest target. This retracement has been already confirmed by the Stochastic Oscillator which is already below the oversold level. BTC is ready to climb higher above $20,000, although there is a possibility BTC will drop again. As long as number one cryptocurrency does not fall lower than $10,889.80, the upward movement to $11,710.80 is still possible.

(Disclaimer)

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

Analysis and trading signals for beginners. How to trade the GBP/USD pair on August 12? Plan for opening and closing deals

Hourly chart of the GBP/USD pair

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The price of the GBP/USD currency pair successfully left the ascending channel through its upper border, which provoked a new downward movement. Therefore, novice traders could work with this new sell signal (closing at the end of the hour under the channel), as we suggested last night. We named two targets for selling in the evening review - 1.3024 and 1.2979. As you can see, the first one was reached, that is, traders could have earned around 40 points on this. The MACD indicator continues to be directed downward, so now there are no signals for starting a correction. Consequently, the pound/dollar pair may continue to fall to the 1.2980 level, which is the previous local low. The further fate of the pound will depend on the ability of market participants to overcome this level.

Novice traders will have something to pay attention to. The day is quite difficult in fundamental terms. There will be several macroeconomic reports, all of them important. We have already talked about US inflation in the EUR/USD article. However, in addition to it, the long-awaited report on GDP for the second quarter will be published in the UK today. The drop in GDP (Gross Domestic Product) is expected to be 20.5% q/q (that is, relative to the first quarter of 2020). This is a huge drop and only the US GDP, which declined by 33% in the same second quarter, can compete with it. No country in the European Union, from where the UK has been trying to exit for four years (Brexit), has such a strong economic decline. Thus, if these figures are confirmed or turn out worse, the pound may continue to fall today (the pair moves down). A report on industrial production for June will also be released today, which could grow in monthly terms by 9.2%. A reported value below this figure may also provoke a decline in the pair. But the GDP report will still come in first place. Thus, even in the morning, novice traders will be able to find out what the changes will be among the most important indicators of the state of the British economy and, before the release of the report on US inflation, trade according to the data received.

The following scenarios are possible on August 12:

1) We still do not recommend buying the pound/dollar pair, since the price initially consolidated below the ascending trend line, and below the ascending channel today. Thus, sellers dominate the market for the time being, therefore, you need to trade for a fall. At the same time, we cannot yet say that a strong downward trend has formed. And it is not a fact that the price will be able to overcome the 1.2980 level.

2) Sales, from our point of view, are much more appropriate now. Novice traders could already sell the pair at the signal to exit the ascending channel. Now it is recommended to either remain selling while aiming for 1.2980, or wait for the MACD indicator to turn up, which will indicate the beginning of a correction, and close sell deals then. You should remember that the market can sharply reverse in the other direction when news comes out, so you should be careful. A close below 1.2980 could trigger a drop towards 1.2923.

What's on the chart:

Support and Resistance Price Levels - Levels that are targets when buying or selling. You can place Take Profit levels near them.

Red lines - channels or trend lines that display the current trend and show which direction it is preferable to trade now.

Arrows up/down - indicate when you reach or overcome which obstacles you should trade up or down.

MACD indicator is a histogram and a signal line, the crossing of which is a signal to enter the market. It is recommended to use in combination with trend lines (channels, trend lines).

Important speeches and reports (always contained in the news calendar) can greatly influence the movement of a currency pair. Therefore, during their exit, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.

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

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

Analysis and trading signals for beginners. How to trade the EUR/USD pair on August 12? Plan for opening and closing deals

Hourly chart of the EUR/USD pair

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The EUR/USD currency pair continued to move down at night trading on Wednesday. Yesterday evening we recommended trading down, but called for being careful with night deals, not forgetting to set Stop Loss and Take Profit. As it turned out in the morning, these precautions were in vain. The pair has been declining all night, and continues to do so now, approaching the target level of 1.1696 in the morning, which is the last price low. Thus, after reaching this level, it will be necessary to see if traders can overcome it. If yes, then the downward movement may continue. If the price rebounds from 1.1696, buyers can get down to business again, who will try to return the pair to 1.1903. And do not forget about the readings of the MACD indicator, the upward reversal of which may indicate the beginning of an upward correction. Also the opportunity presented itself to build the downward trend channel this morning, which you see in the illustration.

The European Union will release a rather important report on industrial production for June. The indicator may decrease by 11.5% in annual terms (relative to June 2019), however, the monthly indicator (relative to May 2020) is more important, which could increase by 10%. A higher value of this indicator may cause the euro to grow in the first half of the day. A lower one will help sellers overcome the 1.1696 level. The US consumer price index (inflation) for July will be released in the afternoon. If core inflation exceeds forecasts (you need to look at annual indicators), which are 1.1% and 0.8%, then the US dollar may continue strengthening in the US trading session (after lunch). If not, then some fall may begin. These two macroeconomic reports are the main ones for today, and the mood of traders will depend on them.

The following scenarios are possible on August 12:

1) Buying the pair is still irrelevant, since the price left the ascending channel and could not overcome the 1.1903 level. The downward trend channel is now clearly supporting the sellers of the pair, and can also show when the mini downward trend will end. Thus, we believe that it is not advisable to trade up now, but if the price consolidates above the channel, it will be a good signal to consider buying.

2) Selling the currency pair is still more promising now. Yesterday we advised selling the pair on the downward reversal of the MACD indicator (marked with a red circle). Therefore, at the time of this writing, those novice traders who followed this advice are in profit of about 40-50 points. These deals can be closed in profit near the levels of 1.1705 and 1.1696, or by an upward reversal of the MACD indicator. We recommend opening new sales of the pair after an upward correction or if the price is pinned below the 1.1696 level (in that case, the targets will be today the levels of 1.1670 and 1.1619).

What's on the chart:

Support and Resistance Price Levels - Levels that are targets when buying or selling. You can place Take Profit levels near them.

Red lines - channels or trend lines that display the current trend and show which direction it is preferable to trade now.

Arrows up/down - indicate when you reach or overcome which obstacles you should trade up or down.

MACD indicator is a histogram and a signal line, the crossing of which is a signal to enter the market. It is recommended to use in combination with trend lines (channels, trend lines).

Important speeches and reports (always contained in the news calendar) can greatly influence the movement of a currency pair. Therefore, during their exit, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.

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

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

Forecast for EUR/USD on August 12, 2020

EUR/USD

The euro and other counterdollar currencies rallied during the first half of Tuesday, on what appears to be profit taking in the first short sales since Friday. The ZEW economic sentiment index in Germany jumped from 59.3 to 71.5 in August against expectations of 58.0 points. The index was higher only in February 2004 (72.9). But this indicator, and especially at this time, has a strong psychological component; it is compiled on the basis of surveys of business representatives who, as always, expect an improvement in their prospects. This was confirmed by the index of current economic conditions ZEW, which showed a drop in the index from -80.9 to -81.3, and against the forecast of growth to -68.8.

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The dollar went on the offensive in the afternoon and as a result the euro closed the day at the opening price. The situation has not changed for the euro on the technical side, the price is heading towards its 1.1620 target. The Marlin oscillator is even closer to the border of the negative trend territory. Its introduction will ease the euro's fall.

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Yesterday's growth stopped by the target level of 1.1806 on the four-hour chart. The level has confirmed its strength, now the price can have no doubts about choosing a direction. The first target is 1.1620.

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Forecast for GBP/USD on August 12, 2020

GBP/USD

The British pound managed to work with the 50.0% Fibonacci level on the daily chart yesterday, after which it fell to the 61.8% level reached today in the Asian session. Now the pound is faced with the task of working with the 76.4% Fibonacci level at the price of 1.2912, after which, consolidating below it, goes to 100.0% at 1.2727. The Marlin oscillator falls down a steep trajectory on a daily basis, which indicates a potential increasing rate of the currency.

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The price reversed from the point where the MACD line coincided with the 50.0% Fibonacci level on the four-hour chart. At the moment, the price is trying to overcome the support of the 61.8% Fibonacci level. The Marlin oscillator is in the bearish zone, which increases the chances of the pound in overcoming this support. Consolidating under it opens the way to 1.2912.

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Forecast for AUD/USD on August 12, 2020

AUD/USD

The Australian dollar took advantage of the temporary weakness of the US dollar and tested the resistance at 0.7190 on Tuesday, after which it turned down and ended the day with a 6-point loss. As before, the price is faced with the task of overcoming the support at 0.7070, to which the MACD line has already approached. Overcoming the level will mean a radical reversal of the trend into a medium-term decline.

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Yesterday's growth stopped at the point where the MACD line coincided with the target level of 0.7190 on the four-hour chart. At the same moment, the signal line of the Marlin oscillator moved down from the border of the growth territory. The current situation is completely downward. We are waiting for the price at the key level of 0.7070.

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Forecast for USD/JPY on August 12, 2020

USD/JPY

The dollar-yen pair became yesterday's leader, gaining 53 points. The price stopped in the target range of 106.60/80. The resistance is complex - the MACD line and the embedded price channel line of the higher timeframe are in this range.

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A strong exit of the Marlin oscillator into the zone of positive values gives the price vigor and optimism in overcoming the specified resistance range. When the price breaks above its upper border at 106.80, the nearest target at 107.00 will open. Reaching the next target of 107.35 is fraught with difficulties, since there was a two-week consolidation in the 107.00/35 range from July 9 to 23. The currency pair needs strong external support to overcome it - the growth of the US stock market. But it was not in the best shape yesterday, with the S&P 500 falling 0.80%.

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The trend is fully upward on the four-hour chart: the price is above the indicator lines, Marlin is in the growth zone. We are waiting for the price to rise. And the stronger the stock market grows, the easier it is for the yen to fulfill the growth target at 107.00 and 107.35.

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

Hot forecast and trading signals for the GBP/USD pair on August 12. COT report. UK GDP report should help sellers

GBP/USD 1H

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The GBP/USD pair continues to move quite strangely on August 11, completely ignoring the Kijun-sen line, which is important and strong. As of today, we are forced to state that buyers failed to go above the 1.3169 level, and sellers failed to continue moving down after overcoming the critical line. Thus, there is even a kind of flat, which can easily turn into a resumption of the upward trend. Despite the fact that the US dollar has significantly fallen in price recently, traders still do not see any reasons to buy this currency, even if it is technically necessary to correct it.

GBP/USD 15M

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Both channels of linear regression turned up on the 15-minute timeframe, showing the hopelessness of the US dollar at this time. The latest Commitment of Traders (COT) report for the British pound, which was released on Friday, finally matched what is happening now in the market. Recall that two COT reports previously showed a decrease in the net position of non-commercial traders, which, in fact, means that the bullish mood is weakening. That is, the most important category of "non-commercial" traders reduced (roughly speaking) purchases of the British pound during the last two weeks and at the same time the UK currency became more expensive. However, the latest COT report finally showed an increase in the number of Buy-contracts for non-commercial traders, by almost 5,000. At the same time, they also closed Sell-contracts, which were reduced by 3,500. Thus, the total net position for this category increased by 8,500. The pound lost just around 140 points at the end of last week and the beginning of the new week, if you count from the last high. This is very small in the context of COT reports and the concept of a trend. This is not even a correction in the medium term.

The fundamental background for the GBP/USD pair was contradictory on Tuesday. For example, the unemployment rate in the UK unexpectedly turned out to be better than forecasts, 3.9%, that is, it did not change compared to the previous month. On the other hand, average wages declined, and the number of applications for unemployment benefits was nine times higher than the forecast. You can interpret these data in different ways, but the British pound did not grow very much after them. Just 30 or 40 points, the usual market noise. The UK will provide much more important information today, which we discussed a week ago. We are talking about the GDP report for the second quarter, which can show the economy contracting by a record 20%. We believe that if this report does not help the US currency, then it is not clear what can help it and pull down the pound/dollar pair. In addition, the change in the volume of industrial production in June will be announced on August 12. However, this report will clearly be in the shadow of the GDP report. The same applies to the report on US inflation. However, if the consumer price index accelerates and comes out better than forecasts, it could also help the dollar today.

There are two main options for the development of events on August 12:

1) Buyers continue to remain dominant, only taking a timeout in the last days. They did not manage to gain a foothold above the previous local high of 1.3169, so we recommend opening new purchases of the British currency, but not before breaking the 1.3169 level while aiming for the resistance level of 1.3275. In this case, the potential Take Profit is about 90 points.

2) Bears returned to the area below the Kijun-sen line with great difficulty. Thus, we can now consider trading for a fall, but we recommend waiting until the trend line and Senkou Span B (1.3010) line have been overcome, and only then should you open short positions with targets at 1.2956 and 1.2865. Potential Take Profit in this case is from 30 to 120 points. In any case, you should be careful with selling the pair. There are many factors working in favor of starting a decline, but the bears are still very weak.

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

Hot forecast and trading signals for the EUR/USD pair on August 12. COT report. Trump proposes to disperse the protesters

EUR/USD 1H

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The technical picture for the euro/dollar pair has not changed much on the hourly timeframe of August 11. The pair traded between the Kijun-sen and Senkou Span B lines throughout the trading day, which are strong lines and are not easy to break through. Traders failed to do this on Tuesday. Thus, the pair is now trapped in a side channel that is bounded by the 1.1911 level on the top and the Senkou Span B line (1.1743) on the bottom. There is also a resistance area of 1.1884-1.1907 on the top, and a support area of 1.1702-1.1727 on the bottom. Thus, we have several important resistances at once both at the top and bottom, and the Kijun-sen line in the middle, from which the price also likes to rebound. Thus, at the moment, the pair can not continue to move down, but there is no need to talk about the resumption of the upward trend now.

EUR/USD 15M

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The lower linear regression channel turned up once on the hourly chart on the 15 minute timeframe, the price did not manage to overcome Senkou Span B. The last Commitment of Traders (COT) report, released on Friday, showed that the mood of professional traders have not changed for the last week (recall that the report comes with a three-day delay), July 29 - Aug 4. The "non-commercial" category of traders opened 19,354 Buy-contracts and closed 3,561 Sell-contracts during this time period. Thus, the net position for the most important category of traders has grown by 23,000 at once, which is a very large and eloquent indication of the current mood of the major players. The most important thing is that the report exactly matches what is happening in the foreign exchange market, since the euro currency as a whole continued to grow until August 4. The euro did not suffer any losses during the next three trading days of the week. Thus, so far, everything is going to the point that the next COT report will show that non-commercial traders are increasing purchases. The pair has recently lost about 120 points, but this drop is too weak to be reflected in the COT report.

The fundamental background for the EUR/USD pair remained unchanged on Tuesday. No optimistic information coming from overseas. Only negative news from US President Donald Trump, the Democrats, the media, on coronavirus, on rallies and protests, and so on. There is still one negative associated with Trump's figure even when he refrains from another discouraging statement. For example, an unknown person opened fire during a regular briefing at the White House yesterday, near the White House itself. Naturally, he could not inflict damage on any of those gathered at the press conference, and in general it is not clear where he was shooting and why he did so. Nevertheless, Trump had to be urgently evacuated from the briefing, and the US dollar could start a new round of decline from the very night because of this event. In addition, if anyone has forgotten, rallies and protests within the "Black Lives Matter" movement continue in many cities in the United States. The fact that some media have stopped covering these events does not mean that the rallies themselves have stopped. This time, Trump suggests sending the National Guard to Portland. "Portland, which is out of control, should finally, after almost 3 months, bring in the National Guard. The Mayor and Governor are putting people's lives at risk. They will be held responsible. The Guard is ready to act immediately." Trump wrote on Twitter. Recall that the rallies have been going on for three months.

Based on the above, we have two trading ideas for August 12:

1) Buyers continue to wait for the right moment to start active trading again. To make new purchases of the euro, you are advised to wait until the price consolidates above the resistance area of 1.1884-1.1910. Then we will recommend buying the pair with the target at the resistance level of 1.2019. In this case, the potential Take Profit is about 80 points. If the price consolidates above the Kijun-sen line (1.1817), you can also open longs with the target of 1.1884.

2) Bears are still moving down with great difficulty. The fact that the price is below the Kijun-sen line leaves them chances for a new downward trend to form. Thus, we recommend opening sales after breaking through the support area of 1.1702-1.1727 while aiming for the 1.1579 level. Potential Take Profit in this case is about 90 points.

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

Analysis and trading signals for beginners. How to trade the GBP/USD pair on August 12? Analysis of Tuesday. Preparation

Hourly chart of the GBP/USD pair

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The technical picture for the GBP/USD pair is getting more complicated day by day. Since the pair's quotes also failed to overcome their previous local high of 1.3169, we expect the pound to fall in the near future. Nevertheless, market participants have been buying the pair in recent days, which even led to forming a short-term upward trend, which is indicated by an upward channel in the illustration. At the same time, we do not advise trading the pound/dollar pair upwards now, as well as for the euro. The likelihood that traders will no longer actively buy the pound around five-month highs is too great, which itself is one of the most problematic and weak currencies in the last four years. Be that as it may, it will be possible to consider buying but not before the 1.3167 level has been overcome. As for selling, for these trades, we advise you to wait for the price to close below the rising channel.

Fundamentally, novice traders had something to look out for on Tuesday. For once, several important macroeconomic publications have been published in the UK. The most interesting - the unemployment report - turned out to be much better than the forecast values and reached 3.9%. In fact, unemployment has not increased from the very beginning of the pandemic and the coronavirus crisis in Britain. What is it? Correct government action? An effective stimulus program from the Bank of England that saved the British from cuts? One way or another, but the pound really had reasons for growth on Tuesday. The other two reports were less rosy, but they were also less significant. Wages slightly fell in June and jobless claims were higher than traders expected.

On Wednesday, novice traders are advised to pay attention to the report on GDP for the second quarter, since this is the most important report for the day. It is expected that the GDP would fall 20.2% compared to the first quarter as a result of the coronavirus crisis, which was also negative. We believe that this information may put pressure on the pound's position, since this is the largest drop in GDP in the country over the past 100 years. A greater economic contraction in the second quarter has only been found in the United States, but the market has already worked out this data. A report on industrial production will also be released tomorrow, which has already begun to recover after quarantine and could grow by 9.2% in June compared to May.

The following scenarios are possible on August 12:

1) Despite the fact that the pound/dollar pair resumed its upward movement, we believe that buying around five-month highs is not the wisest decision. Nevertheless, if the price manages to close for an hour above the 1.3167 level, which passes through the last two peaks of the price, this will be a signal for new small purchases.

2) Selling, from our point of view, can be considered if the price manages to gain a foothold below the upward channel in which it is trading right now. In this case, sellers may again try to bring the pair to the levels of 1.3024 and 1.2979. Most likely, the MACD indicator in this case will be automatically directed downward. This signal can also be formed at night, which is somewhat inconvenient in terms of accompanying an open deal.

What's on the chart:

Support and Resistance Price Levels - Levels that are targets when buying or selling. You can place Take Profit levels near them.

Red lines - channels or trend lines that display the current trend and show which direction it is preferable to trade now.

Arrows up/down - indicate when you reach or overcome which obstacles you should trade up or down.

MACD indicator is a histogram and a signal line, the crossing of which is a signal to enter the market. It is recommended to use in combination with trend lines (channels, trend lines).

Important speeches and reports (always contained in the news calendar) can greatly influence the movement of a currency pair. Therefore, during their exit, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.

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

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

Analysis and trading signals for beginners. How to trade the EUR/USD pair on August 12? Analysis of Tuesday. Preparation

Hourly chart of the EUR/USD pair

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The EUR/USD pair began to correct upward again on Tuesday, August 11, which was signaled by the MACD indicator with an upward reversal at night. In fact, the correction began at night trading and did not stop throughout the day. Thus, novice traders did not receive a new sell signal. Therefore, short positions should not have been opened. We did not recommend buying the pair, since the upward trend is temporarily paused, and the price has not yet reached the 1.1696 level (the previous price low). However, take note that the volatility of the EUR/USD pair increased on Tuesday, so we can expect stronger moves on Wednesday and the rest of the week.

Fundamentally speaking, there was nothing to analyze on Tuesday. No important economic news and reports on that day. However, there was not even much usual news, and most of it came from America again. Although, there is no particularly interesting information here even for novice traders. An unknown person opened fire during a regular briefing by US President Donald Trump. Where the attacker was shooting and why he did so is unknown. After all, the president was at a press conference inside the White House. Thus, even theoretically, the attacker could not inflict any harm on the US president. Nevertheless, this news had a very negative impact on the US currency, which, as we said above, began to fall overnight. Several macroeconomic reports from Europe did not have a particular impact on the pair's quotes. All of them reflected the economic expectations of major investors and managers in Germany and the European Union.

Novice traders are advised to carefully study two reports on Wednesday, August 12. The first will be published in the morning - industrial production in the European Union. The second - after lunch - inflation in the United States. Industrial production has a huge impact on GDP and is therefore considered a fairly important report. It is expected to grow by 10% m/m by the end of June. As for inflation in America, the main indicator (which takes into account absolutely all prices) is projected to rise to 0.8% y/y, while inflation excluding food and energy (volatile commodity groups) may slow to 1.1% y/y. g. In general, these figures do not indicate either a serious improvement in the situation or a serious deterioration. Recall that, in principle, any value of core inflation below 2% is considered weak, since the Federal Reserve (the US central bank) is exactly aiming for 2% y/y.

The following scenarios are possible on August 12:

1) Purchases of the pair remain irrelevant at this time, since the price was not able to overcome the 1.1903 level. Traders are currently deprived of buy signals. Based on this, we do not recommend trading the pair up. We still believe that quotes should fall at least to the 1.1696 level, and only after that it will be possible to speculate about a possible resumption of the upward trend.

2) Selling the currency pair is still more promising now, at least with the target of 1.1696 (the previous local low). There are now about 60 points to this goal, but with the current volatility, even these 60 points will be difficult to pass. The MACD indicator reversed down just a few hours ago, so now there is a signal for new sales with targets at 1.1714 and 1.1696. Leaving a trade open overnight for novice traders is a bit risky, so if you do this, you must set Take Profit and Stop Loss.

What's on the chart:

Support and Resistance Price Levels - Levels that are targets when buying or selling. You can place Take Profit levels near them.

Red lines - channels or trend lines that display the current trend and show which direction it is preferable to trade now.

Arrows up/down - indicate when you reach or overcome which obstacles you should trade up or down.

MACD indicator is a histogram and a signal line, the crossing of which is a signal to enter the market. It is recommended to use in combination with trend lines (channels, trend lines).

Important speeches and reports (always contained in the news calendar) can greatly influence the movement of a currency pair. Therefore, during their exit, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.

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

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