Trading idea for the EUR/USD pair

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Good afternoon traders! A trading idea for the EUR / USD pair.

Price dropped according to the plan presented last August 10 , at which short positions were traded to pull down the EUR / USD pair in the market.

The main movement occurred yesterday during the US session, in the form of strong short-term initiatives in the hourly chart.

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To continue the bearish momentum of quotes, hold or enter new short positions with sell limits at 1.18300, targeting a drop and breakout in the level of 1.17. Such will provide profit up to 1,400 points. Control risks so as to avoid losing profit.

This setup uses Price Action and Stop Hunting strategies. Good luck!

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Technical Analysis of GBP/USD for August 14, 2020:

Technical Market Outlook:

The GBP/USD pair has broken through the short-term trend line resistance around the level of 1.3100, but after the local high was made at the level of 1.3121, the market retreated. The bearish pressure intensify and the price is currently trading around the level of 1.3060, just below the intraday support at 1.3067. The next support is seen at the level of 1.3017, but 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 14, 2020:

Technical Market Outlook:

The EUR/USD pair has been rejected around the level of 1.1864 after the Bearish Engulfing pattern had been made just at the lower channel line. The market is trading around 61% Fibonacci retracement again and might extend the losses. The nearest technical resistance is seen between the levels of 1.1790 - 1.1822. Any violation of this zone will extend the rally towards the next key technical resistance seen at the level of 1.908.The weekly time frame trend is still up and the momentum is above 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 support for intraday traders is seen at the level of 1.1790.

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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Analysis and trading recommendations for the EUR/USD and GBP/USD pairs on August 14

Trading recommendations for the EUR / USD pair on August 14

Analysis of transactions

The signal to buy the European currency from the level of 1.1819 worked positively yesterday, allowing about 30 points of profit to be taken from the market. The increase came after the publication of good data on eurozone inflation, after which the closing of long positions broke the bullish trend and turned down the quote in the price chart.

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Today, euro may start to decline amid strong contraction in the eurozone economy for the second quarter. Good data on US retail sales in the afternoon will also contribute to the rise of the dollar and decrease of the EUR / USD pair in the market.

  • Buy positions when the quote reaches a price level of 1.1835 (green line on the chart), targeting a rise to the level of 1.1878. The increase may occur after the release of the Eurozone GDP report, provided that the data turns out better than the forecasts. Take profit at the level of 1.1878.
  • Sell positions after the quote reaches a price level of 1.1802 (red line on the chart), targeting a drop to the level of 1.1757. However, before selling, make sure that the data on the European economy is worse than forecasted, as only such will contribute to the decline of the EUR / USD pair. Take profit at a price level of 1.1757.

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Trading recommendations for the GBP / USD pair on August 14

Analysis of transactions

The signal to buy the pound from the level of 1.3074 worked positively, giving a profit of more than 30 points from the market.

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Data on the volume of retail trade in the US will be published today, which could restore demand for the US dollar provided that the figure comes out better than the forecasts. A good performance will increase the pressure on the British pound, and lead to a decline in the GBP / USD pair in the market.

  • Buy positions when the quote reaches a price level of 1.3085 (green line on the chart), targeting a rise to the level of 1.3127 (thicker green line on the chart). However, growth is not really expected today, so it is better to take profit at the level of 1.3127.
  • Sell positions after the quote hits the price level of 1.3049 (red line on the chart), as a breakout of which will lead to a rapid decline in the pair today. Support will be obtained in the form of good data on the US economy, the report for which will come out this afternoon. The target of the decline is the price level 1.3005, which is also a good target profit in the market.

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Market reacts to good data on the US economy by selling the dollar (further consolidation of the EUR/USD pair and a local

The released data on the number of applications for unemployment benefits in the US put pressure on the dollar, showing it its current place in the global financial system, the place of the funding currency, which provides for a rather prolonged period of weakness of its exchange rate against major currencies.

According to the data presented, the number of applications for unemployment benefits in the United States dropped significantly to 963,000 over the past week against the forecast of 1.120 million and revised upward to 1.191 million of the previous data. These figures, of course, can only show a local improvement in the situation on the labor market and not become a prologue to the upcoming positive dynamics, but they can be the first sign of an improvement in the picture in the US economy.

The published figures of the export and import price indices also added positivity. The indicators showed an increase in their growth rate last month by 0.8%, respectively, with the forecast of an increase of 0.4% and 0.7% against the expected growth of 0.6%.

Now, let's go back to the prospects for the dollar. Of course, the US economy is in dire need of a weak dollar. It needs it like air. In a situation of severe losses inflicted by the coronavirus infection on the country's economy, it is not enough to put pressure on economic opponents to successfully compete in world markets, which D. Trump is now actively engaged in both in Europe and in Asia. It is necessary to win at the cost of goods and services. And here, the relatively low exchange rate of the national currency will support the demand for American exports, which in turn, will stimulate domestic production and support the economic recovery.

Considering this need amid unprecedented stimulus measures from the Fed and the US Treasury, a prolonged period of weakness in the US currency should be expected. And yet, judging by the way the market reacts to positive economic statistics, we should expect only an increase in the dollar decline against the main currencies. Investors by their actions, and these are dollar sales, clearly indicate this.

As for the possible dynamics of the currencies of countries with developing economies, they are likely to suffer from a weakening dollar, as capital will flow from emerging markets (EM) to economically developed and invested in risky assets.

In general, assessing the emerging picture, we believe that the dollar will weaken in the future as new positive data on the US economy comes in.

Forecast of the day:

The EUR/USD pair remains in the range of 1.1700-1.1900. We believe that this dynamics will continue throughout the day and we believe that the pair should be sold locally at a rise from 1.1900.

The USD/CAD pair remains in a short-term downward trend. In the wake of the limited recovery in oil prices, it may decline to the level of 1.3150 after falling below 1.3200.

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Technical Analysis of BTC/USD for August 14, 2020:

Crypto Industry News:

MicroStrategy confirms that it has made bitcoin the main reserve asset of its business. The world's largest company from the Business Intelligence sector has purchased 21,000 BTC for over a quarter of a billion dollars. MicroStrategy confirms that institutional BTC adoption is taking increasingly confident steps.

MicroStrategy (Nasdaq: MSTR), the world's largest publicly traded BI company, has formally adopted Bitcoin (BTC) as its main reserve asset.

In a press release released on August 11, MicroStrategy confirmed that it had purchased 21,454 BTC for $ 250 million. Michael J. Saylor, CEO of MicroStrategy, commented in a press release:

"This investment reflects our belief that Bitcoin, as the world's most widespread cryptocurrency, is a reliable store of value and an attractive investment asset with greater long-term growth potential than cash storage."

This move is a turning point for the institutional adoption of Bitcoin, and it did not go unnoticed by commentators.

Technical Market Outlook:

The BTC/USD pair has been seen trading just in the middle of the range after the volatility dried up a little. The momentums has decreased and now is seen below the fifty level again, so the odds for the pull-back are high. The nearest technical support is seen at the level of $11,395 and $11,317. 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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USD/CAD Price Movement On August 14, 2020

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On the 4-hour chart, we spotted the Divergence between the Price and the Stochastic Oscillator. This indicates an upward retracement of USD/CAD which will interrupt the bearish bias. The retracement could happen after the loonie breaks the market structure first at 1.3191 before the price goes up for a retracement. Please pay attention to the 1.3338 level if the pair will pass it. Then, we might spot signs that the bearish bias of USD/CAD will change.

(Disclaimer)

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Technical Analysis of ETH/USD for August 14, 2020:

Crypto Industry News:

Federal regulators in Germany want to modernize domestic securities with Blockchain technology.

The German Federal Ministry of Finance (BMF) and the Federal Ministry of Justice and Consumer Protection (BMJV) have presented a bill on digital securities based on the Blockchain chain. In an official statement, the authorities stressed that the adoption of digital securities is one of the main aspects of the federal government's Blockchain strategy.

According to the law in force in Germany, financial instruments that are classified as securities must be secured by a document. Blockchain technology would thus help guarantee fluidity and compliance by providing a replacement for a paper certificate, the BMF and BMJV said. According to the authorities, the proposed bill also improves regulatory clarity by anticipating that the Federal Financial Supervisory Authority will act as the lead regulator for Blockchain-based e-shares.

The agency, also known as BaFin, will be responsible for monitoring the issuance of digitized securities and keeping decentralized books under German banking law, an official statement says.

Technical Market Outlook:

The ETH/USD pair has finally broken through the trend line resistance and supply zone and made a new yearly high at the level of $430.85. Currently the zone located between the levels of $407.33 - $414.11 will be acting as demand zone for the market. The bulls are consolidating the gains, but the test of the level of $414.11 should be made soon. If the test is successful, then ETH/USD will continue to move upward. 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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GBP/USD: plan for the European session on August 14 (analyzing yesterday's trade). Bears fighting back after Trump's statements.

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

US President Donald Trump's recent claims that the European Union is unfair with regard to trade with the United States has reminded investors of the possibility that duties could be unilaterally imposed on a number of European Union countries, in particular Germany and France. This led to increased pressure on risky assets and also strengthened the US dollar. The pressure on the pair has increased given the fact that the UK itself can not agree on a trade deal with the EU. If we talk about yesterday's deals, only a single signal formed to buy the pound, which did not show anything special. If you look at the 5-minute chart, you will see that after the breakout and consolidation above the 1.3092 level, it was tested from the top down, which formed a good entry point into long positions. However, all bullish growth slowed down in the 1.3125 area, after which the pair returned back to the 1.3092 level, and the pressure on the pound increased. At the moment, the bulls need to protect the support of 1.3047 and a false breakout forming on it will be the first signal to open long positions on the pound. Only this will return GBP/USD to the area of yesterday's resistance of 1.3120. A high at 1.3181 is still the long-term goal for buyers, where I recommend taking profits. In case the pair falls below the 1.3047 area, I recommend postponing purchases until we update a low of 1.2983, the test of which will allow you to demolish a number of stop orders of speculative players, which are located under this week's lows. Afterwards, you can buy the pound there immediately on the rebound in anticipation of a correction of 30-40 points within the day.

Let me remind you that the Commitment of Traders (COT) reports for August 4 recorded significant changes, as traders began to regain long positions on the pound and cut short ones. This suggests that the balance of power is gradually changing again, and investors are more confident that the UK and the EU will be able to agree on a trade deal that will help the economy recover in 2021. The COT report indicates that short non-commercial positions decreased from the level of 64,738 to the level of 60,704 during the week. On the contrary, long non-commercial positions rose from the level of 39,392 to the level of 45,977. As a result, the non-commercial net position again decreased its negative value to -14,727, against -25,409, which indicates a slower fall in the pound after the US dollar regained strength.

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

Sellers need to break below the support of 1.3047, as only a consolidation below this level will be a good signal to open short positions further in anticipation of pulling down the pair to a low of 1.2983. The low of 1.2916 is the long-term goal, where I recommend taking profits. In case the pair recovers even more in the morning, it is better not to rush to sales and wait for a test of major resistance at 1.3120 and sell the pair from there immediately on a rebound, based on a correction of 30-40 points. If there is no rapid movement down from this range, it is better to postpone short positions until the test high of 1.3181.

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Indicator signals:

Moving averages

Trading is carried out in the area of 30 and 50 moving averages, which indicates the uncertainty of the market with a further direction.

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

Bollinger Bands

Growth will be limited around the upper border of the indicator 1.3110. A break of the lower border of the indicator in the area of 1.30300 will increase the pressure on the pound.

Description of indicators

  • Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 50. It is marked in yellow on the chart.
  • Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 30. It is marked in green on the chart.
  • MACD indicator (Moving Average Convergence/Divergence — convergence/divergence of moving averages) Fast EMA period 12. Slow EMA period to 26. SMA period 9
  • Bollinger Bands (Bollinger Bands). Period 20
  • Non-commercial traders are speculators, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet certain requirements.
  • Long non-commercial positions represent the total long open position of non-commercial traders.
  • Short non-commercial positions represent the total short open position of non-commercial traders.
  • The total non-commercial net position is the difference between short and long positions of non-commercial traders.
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EUR/USD: plan for the European session on August 14 (analyzing yesterday's trade). Several important reports on the eurozone

To open long positions on EURUSD, you need:

It was not possible to wait for adequate points to enter the market yesterday after updating resistance at 1.1843. Let's take a look at a 5-minute chart. Clearly, you can see that the bulls tried to gain a foothold in this range after the breakout of 1.1843, but the bears quickly returned the pair below this level. Afterwards, there was an attempt to arrange a downward movement following news that there has been an improvement in the situation of the US labor market, but even a miss was made here, and the 1.1843 level is being stitched again from the bottom up. All this led to a revision of the technical picture and new supports and resistances being formed. At the moment, the bulls need to protect the 1.1795 area. I recommend opening long positions from there only after forming a false breakout along with good eurozone data on GDP and the unemployment rate. Reports should at least be as good as economists' forecasts. In this case, you can count on EUR/USD returning to the resistance area of 1.1861, where I recommend taking profits. A high at 1.1900 will be the long-term goal. In case we do not see a rapid upward movement in the 1.1795 area, it is best to postpone long positions until a low of 1.1757 has been updated, or buy the euro immediately on the rebound from the support of 1.1714 in anticipation of a correction of 30-40 points within the day.

Let me remind you that the Commitment of Traders (COT) reports for August 4 recorded an increase in long positions and a reduction in short ones, which tells us that investors are still interested in risky assets, even at such high prices. Many are betting that the US dollar will weaken even more before the US election and a more difficult situation with the spread of the coronavirus epidemic. The report shows an increase in long non-commercial positions from the level of 242,127 to the level of 262,109, while short non-commercial positions decreased from 84,568 to 81,461. As a result, the positive non-commercial net position sharply jumped to 180,648, up from 157,559 a week earlier, indicating increased interest in buying risky assets even at current high prices.

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

Sellers will wait for more bad data on the eurozone economy and continue to pull down the pair under the 1.1795 level. Settling under this range will increase pressure on the euro, which will lead to a larger sell-off in the area of lows 1.1757 and 1.1714, where I recommend taking profits. However, we can reach these areas only if the US fundamental data turn out to be poor, which is set to be released in the afternoon. Disappointing data will further raise investor concerns and reduce demand for risky assets. In case EUR/USD grows in the first half of day, it is best to defer short positions to updates of a 1.1861 high or sell immediately for a rebound after testing the monthly level of 1.1912 based on the correction of 30-40 points.

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Indicator signals:

Moving averages

Trading is carried out in the area of 30 and 50 moving averages, which indicates market uncertainty.

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

Bollinger Bands

A breakout of the lower border of the indicator around 1.1795 will lead to a larger decline in the euro. Growth will be limited by the upper level of the indicator around 1.1850.

Description of indicators

  • Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 50. It is marked in yellow on the chart.
  • Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 30. It is marked in green on the chart.
  • MACD indicator (Moving Average Convergence/Divergence — convergence/divergence of moving averages) Fast EMA period 12. Slow EMA period to 26. SMA period 9
  • Bollinger Bands (Bollinger Bands). Period 20
  • Non-commercial traders are speculators, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet certain requirements.
  • Long non-commercial positions represent the total long open position of non-commercial traders.
  • Short non-commercial positions represent the total short open position of non-commercial traders.
  • The total non-commercial net position is the difference between short and long positions of non-commercial traders.
The material has been provided by InstaForex Company - www.instaforex.com

EUR/JPY Price Movement On August 14, 2020

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At the 4-hour chart, we can see that EUR/JPY is trying to reach the 127.47 level because this currency pair is still trading with the bullish bias. This has been already confirmed by technical analysis. The price is moving above the upward moving average. Before the pair reaches its target, it expected to make a retracement first as the condition for the healthy uptrend from the technical view. This retracement is confirmed by the divergence spotted between the price and the Stochastic Oscillator. Based on this fact, there is a possibility of the retracement of EUR/JPY with the target at the 126.16 - 125.86 levels. As long as the pair does not close below 123.96, the bullish outlook for this pair is still valid.

(Disclaimer)

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

Brief trading recommendations for EUR/USD and GBP/USD on 08/14/20

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The EUR/USD currency pair has been following the amplitude of the side channel 1.1700 // 1.1810 // 1.1910, (6 + 5 + 4, lines) for the third week now and consistently working out the set boundaries. This time, the quote managed to consolidate above line 5 (area 1.1810), moving us to the upper part of the channel 1.1810/1.1910.

Based on the price fixing points with respect to the side channel, a number of possible market development scenarios can be obtained:

First, following the price towards line No. 4

In this case, we consider the price movement along the course of the upper part of the side channel 1.1810/1.1910, where line No. 5 plays the role of a support, which makes it possible to complete the cycle by touching the upper border of the channel. The entry point for a buy position is above the high of the previous day at 1.1864, which will give an opportunity to enter the market directly at the moment of the main movement.

Second, the price returns to the bottom of the channel.

In this case, the swing cycle between lines no. 5 and no. 6 resumes, where the quote consolidates below the level of 1.1750 first, and then goes towards 1.1720-1.1700

Third, breakdown of line No. 4 or No. 6

In this case, we are talking about the completion of the amplitude of the side channel 1.1700 // 1.1810 // 1.1910, where the main strategy is aimed at identifying price fixing points outside one or another border, which will make it possible to predict the further course of the market.

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The GBP/USD currency pair has a similar cycle of sideways fluctuations within the boundaries of 1.2985 // 1.3085 // 1.3185 (# 6; 5; 4), where market participants managed to locally jump to the area of the current week's maximum (1.3115 / 1.3130) during the previous day. The area of the maximum played the role of resistance, returning the quote below the centerline of 1.3085 (# 5).

Based on the fact that the quote returned below line 5, we can consider the option of short positions (sell positions), resuming the swing cycle in the lower part of the sideways range.

Market development scenario:

First, price fluctuations at the bottom of the sideways range, lines No. 5 and No. 6

In this case, we consider the price movement along the course of the lower part of the sideways range, as it happened from the very beginning of the trading week. The point for entering sell positions is considered below the level of 1.3040, in the direction of 1.3010-1.3000.

Second, consolidating the price above the high of the current week

In this case, an upward move is considered, where the quote first needs to consolidate above the level of 1.3130, which may lead to a subsequent movement to line No. 4 (1.3185 area).

Third, breakdown of line No. 4 or No. 6

In this case, we are talking about the completion of the amplitude of the side channel 1.2985 // 1.3085 // 1.3185, where the main strategy is aimed at identifying price fixing points outside a particular border, which will make it possible to predict the further course of the market.

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Analytics and trading signals for beginners. How to trade the EUR/USD pair on August 14? Plan for opening and closing trades

Hourly chart of the EUR/USD pair

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The EUR/USD currency pair was trading mostly sideways during Friday night trading. Thus, the price is exactly between the levels of 1.1903 and 1.1696 at the moment, that is, in the middle of the side channel. Based on this, the euro/dollar pair can move in any direction with the same probability from the current positions. Since the last movement was downward, today novice traders can expect a reversal of the MACD indicator up, which is also located in the middle of its coordinate grid, which will allow them to buy the European currency again. There are still no new technical patterns, such as a trend line or channel. Yesterday afternoon, the dollar was unexpectedly helped by a US report on applications for unemployment benefits. There will also be quite a large number of important data today, so the pair may change the direction of movement more than once during the day. However, in general, it is now impossible to say who is stronger, buyers or sellers.

Today, the European Union will release the most important report on Gross Domestic Product for the second quarter of 2020. According to forecasts, the drop will be 12.1% compared to the first quarter. If the real contraction of the European economy is greater, then there is no doubt that the euro will start to fall in price on Friday. If it turns out less, the single currency (euro) can continue to grow to 1,1903. Thus, novice traders are recommended to trade as carefully as possible when this report is released, since the dynamics of the pair will depend on today's data. A few hours after this report, the US will release data on changes in retail sales for July, as well as industrial production and consumer confidence index from the Institute of Michigan. Here everything is the same as with the eurozone GDP report. Exceeding the forecast values will most likely cause purchases of the US currency and the euro/dollar pair may start falling in this case. And vice versa. The retail sales report has a higher value. You should pay special attention to it. Novice players are also recommended to be cautious and act carefully when the US data are released.

The following scenarios are possible on August 14:

1) Long deals on the pair have become relevant after the price settled above the downward channel, and, in principle, remains relevant now. The pair has corrected down by 60 points, thus, the upward movement may resume on Friday morning. If the MACD indicator turns up (which can happen at the close of the current bar), then long positions with the first target at 1.1858 are recommended. The second target is 1.1903, above which the price is unlikely to go away today.

2) Since the price is exactly in the middle of the side channel, selling is now as relevant as buying. The only thing is that after the sideways movement for new sales at night, you are advised to wait for a new reversal of the MACD indicator downward and only after that it will be possible to open short positions with the targets of 1.1775 and 1.1736. But we remind you once again that today two packs of important information will be released at once, each of which can change the mood of traders and lead to a price reversal.

What's on the chart:

Support and Resistance Levels are the levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.

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

Up/down arrows show where you should sell or buy after reaching or breaking through particular levels.

The MACD indicator consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend lines (channels and trend lines).

Important announcements and economic reports (you can always find them in the news calendar) can seriously influence the trajectory of a currency pair. Therefore, at the time of their release, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal.

Beginners in the Forex market should remember that not every single trade should 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

Elliott wave analysis of GBP/JPY for August 14, 2020

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GBP/JPY pushed higher as expected but fell short of the ideal target by just 15 pips, but all requirements have been fulfilled and a correction in blue wave iv could start anytime now. A break below minor support at 139.48 and more importantly a break below support at 139.09 will confirm that blue wave iii has been completed and blue wave iv is in motion for a dip at least to 138.39 and likely even closer to 137.81 before the next impulsive wave higher occurs.

R3: 141.56

R2: 141.00

R1: 140.35

Pivot: 139.92

S1: 139.48

S2: 139.09

S3: 138.80

Trading recommendation:

We are long GBP from 135.44 and we will take profit at 140.25 or upon a break below 139.45.

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

Elliott wave analysis of EUR/JPY for August 14, 2020

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EUR/JPY has now tested the 126.68 target, which means the 5 wave rally from 119.31 could be completed. This rally has not been strong enough or long enough to be a wave 3 rally. Therefore, it is more of a wave 1/ of 3, which means we will have much more upside to cover once wave 2/ of 3 is completed.

In the short-term, we do expect a final push to test the 127.43 level before wave v of 1/ finally completes and wave 2/ of 3 enters the correction phase to at least 123.02.

R3: 127.43

R2: 127.00

R1: 126.68

Pivot: 126.42

S1: 126.07

S2: 125.73

S3: 125.43

Trading recommendation:

We are long EUR from 125.44 and we will raise our stop to 125.70 or we will take profit on our long position at 127.20.

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

Forecast for EUR/USD on August 14, 2020

EUR/USD

The euro's 28 points gain from yesterday plunged into a wide range of uncertainty and wandered through 1.1710-1.1906. The Marlin oscillator is directed downwards on the daily chart, and the price is exactly at the 1.1806 target level. The price could reach the upper border of the price channel at 1.1906 without a critical upward reversal of the oscillator. The price may even cross this border and a double divergence will not form according to the oscillator, which creates increased uncertainty for the currency pair.

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For a medium-term downward movement, it is no longer enough for the price to gain a foothold below the 1.1806 level, it should consolidate below the lower border of the 1.1710 range.

The situation is no less uncertain on the four-hour chart. The Marlin oscillator is in the growth zone, the price is above the balance line, but below the MACD line.

Trading the euro today and even on Monday is associated with increased risk.

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

Forecast for AUD/USD on August 14, 2020

AUD/USD

The Australian dollar fell 12 points against the overall decline of the US dollar by 0.20% on Thursday. This is partly due to the decline in commodity prices. Oil dropped 0.47% and copper with 3.11%. The price typically touched the 0.7190 target level with its upper shadow, which once again confirmed its stability. The Marlin oscillator almost touched the border of the bears' territory. Moving into it, the oscillator will show that the market is strengthening its sentiment to sell. The first target remains at 0.7070.

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As before, the price is developing under the balance and MACD indicator lines on the four-hour chart, Marlin moving down from the border with the bulls' territory. We are waiting for AUD/USD to decline further to the nearest target of 0.7070. Overcoming it opens the way to further decline in the medium-term.

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

Forecast for USD/JPY on August 14, 2020

USD/JPY

The dollar-yen currency pair completed an important task yesterday - it consolidated with the body of a candle above the balance and MACD lines, and the downward trend of the price channel. The price is trying to push through the resistance of the 107.00 target level this morning. Success will make it possible for the price to rise to 107.35, then 107.90.

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The price is also above both indicator lines on the four-hour chart. The Marlin oscillator has fallen into the horizon, but is kept in the positive (growing) trend zone. We are waiting for the price to rise to the designated goals.

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Hot forecast and trading signals for the GBP/USD pair on August 14. COT report. Calm news in the UK unable to get the pound/dollar

GBP/USD 1H

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The GBP/USD pair continued to trade inside the side channel on August 13, limited to the level of 1.3000 and 1.3169. Thus, the channel width for the pound is even less than for the euro. The resumption of the trend movement can be identified only when the price consolidates above or below the channel. Until then, traders can only trade between the borders of this channel at their own risk, since it is very inconvenient to trade in the flat, or wait for the completion of the sideways movement and the resumption of the trend.

GBP/USD 15M

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Both linear regression channels turned up on the 15-minute timeframe, and change their direction of movement every day, which is absolutely normal for a flat. The latest Commitment of Traders (COT) report for the British pound, which was released last Friday, corresponded to what is happening now in the market. Two COT reports previously showed a decrease in the net position of non-commercial traders, which, in fact, means that the bullish mood is starting to weaken. It turned out that the most important category of traders, "non-commercial", reduced (roughly speaking) purchases of the British pound during the previous two weeks, but 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 market situation has not changed during the current week, of which only data for Monday and Tuesday will be included in the next report, while the pound sterling has begun to significantly drop. Therefore, the new COT report is unlikely to show major changes in the mood of traders.

No fundamental background for the GBP/USD pair. Earlier, when traders regularly received news about the talks on a deal between London and Brussels, or about British Prime Minister Boris Johnson's intentions to complete the negotiations, his desire to complete the "transition period" in 2020, you could always expect the movement of the pound/dollar pair to be based on the fundamental background. Right now, Britain is completely calm, and provides no information. Important macroeconomic reports were published during the week, which not only failed to bring the pair out of the flat, but also did not cause much reaction from traders. Simply put, the markets ignored reports on GDP, unemployment, and industrial production. In addition, market participants are already fed up with the fundamental background from America. It is impossible to sell the dollar day after day based on the same news. Yes, the country is in crisis, in a serious crisis and not just one. However, the US dollar has already fallen by 8.5 cents against the pound since June 30, that is, for a month and a half. And during all this time, there was not a single noticeable pullback of the price down. Therefore, the bulls and bears are now simply at a standstill, which is displayed on the chart as a flat.

There are two main options for the development of events on August 14:

1) Buyers generally continue to hold the pound/dollar initiative in their hands. 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. You can also try to buy the pound when consolidating above the Kijun-sen, but this signal will be weak.

2) Bears have already failed to overcome the support area of 1.3003-1.3023 five or six times. Therefore, if the price consolidates below the Kijun-sen line (1.3067), we can expect the price to fall in this area. Each trader will have to decide for himself whether to reject this signal or not, since the pair as a whole remains in a flat. We do not see the pair below the 1.3003 level yet, but if this level is overcome, we recommend opening sells with targets at 1.2956 and 1.2865.

Hot forecast and trading signals for the EUR/USD pair.

We recommend that you also explore the fundamental background in these articles:

Overview of the EUR/USD pair. August 14. US economy has contracted twice as much as the EU economy due to the pandemic. Trump loses his last advantage in front of voters.

Explanations for illustrations:

Support and Resistance Levels are the Levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.

Kijun-sen and Senkou Span B lines - lines of the Ichimoku indicator transferred to the hourly timeframe from the 4-hour one.

Support and resistance areas are areas from which the price has repeatedly rebounded off.

Yellow lines - trend lines, trend channels and any other technical patterns.

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

Hot forecast and trading signals for the EUR / USD pair on August 14. COT report. Eurozone GDP report could bring traders'

EUR/USD 1H

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The euro/dollar pair managed to consolidate above the Kijun-sen and Senkou Span B lines on the hourly timeframe of August 13. Therefore, the bulls even got the opportunity to continue buying the euro while aiming for the resistance area of 1.1884-1.1910. However, the quotes did not reach this area during the day. And in general, the pair is still moving sideways, limited by the $1.17 and $1.19 levels. Therefore, you can trade within it until you go beyond this range. At the same time, you should understand that there is no trend at this time. Bulls and bears still can't decide which way to move the pair further.

EUR/USD 15M

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Both linear regression channels turned up on the 15-minute timeframe after traders failed to overcome the 1.1702-1.1727 area. The latest Commitment of Traders (COT) report, released last Friday, showed that the mood of professional traders did not change at all during the last reporting week on July 29-August 4 (the report is published with a three-day delay). During this time period, the "non-commercial" category of traders opened 19,354 Buy-contracts and closed 3,561 Sell-contracts. 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 as a whole continued to grow until August 4. The euro did not suffer any losses during the entire current week. Thus, most likely, the new COT report, which will be published as early as this afternoon, will show that non-commercial traders were increasing purchases again. Or, at least, the net position of non-commercial traders has not decreased. In this case, we will have to state that the market remains very bullish.

The fundamental background for the EUR/USD pair was extremely weak on Thursday. Inflation in Germany released in the morning and applications for unemployment benefits in America in the afternoon. No more macroeconomic data were published that day. Although the report on applications for unemployment benefits should have pleased traders, as for the first time since the beginning of the pandemic, their number was less than 1 million. The number of secondary applications continues to decline and is already 15.5 million. Unfortunately, these are still high unemployment rates, but they are still falling. The US dollar responded to this report with a restrained drop of only 30-40 points. The following data will be released in the last trading day of the week: the EU will publish an important report on GDP for the second quarter, and in the United States – retail sales for July, industrial production for July, as well as the consumer confidence index of the Institute of Michigan for August. We believe that the eurozone GDP report can support the US currency. Especially if it turns out to be worse than forecasted at -12.1% from the previous quarter.

Based on the above, we have two trading ideas for August 14:

1) Buyers continue to wait for the right moment to restart active trading. 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 recommend buying the pair while aiming for the resistance level of 1.2019. In this case, the potential Take Profit is about 80 points. You can also trade relative to the Kijun-sen line inside the sideways channel, but trading in a flat is not the most pleasant experience.

2) Bears continue to experience big problems and cannot go below 1.1715. We recommend opening sales after breaking through the support area of 1.1702-1.1727 with the first target at the 1.1579 level. Potential Take Profit in this case will be about 90 points. If the price consolidates below the Kijun-sen line, you can open small shorts with the 1.1720 target.

Hot forecast and trading signals for the GBP/USD pair.

We recommend that you also explore the fundamental background in these articles:

Overview of the EUR/USD pair. August 14. US economy has contracted twice as much as the EU economy due to the pandemic. Trump loses his last advantage in front of voters.

Explanations for illustrations:

Support and Resistance Levels are the Levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.

Kijun-sen and Senkou Span B lines - lines of the Ichimoku indicator transferred to the hourly timeframe from the 4-hour one.

Support and resistance areas are areas from which the price has repeatedly rebounded off.

Yellow lines - trend lines, trend channels and any other technical patterns.

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

Comprehensive analysis of commodity currencies AUD/USD & USD/CAD & NZD/USD (H4) on August 14, 2020

Minute operational scale (H4)

The end of this week and the beginning of the next - an overview of options for the development of the movement for AUD/USD & USD/CAD & NZD/USD (H4) on August 14, 2020.

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Australian dollar vs US dollar

The development of the movement of the Australian dollar AUD/USD from August 14, 2020 will continue to determine the development and direction of a breakout of the channel borders 1/2 Median Line (0.7220 - 0.7195 - 0.7170) of the Minuetteoperational scale fork - see the animated chart for details.

In case of a breakdown of the lower border of the 1/2 Median Line Minuette - support level of 0.7170, the downward movement of AUD/USD will be directed to the boundaries of the equilibrium zone (0.7140 - 0.7105 - 0.7070) of the Minuette operational scale fork.

If the resistance level of 0.7220 breaks at the upper border of the channel 1/2 Median Line Minuette, it will be possible to update the maximum 0.7244 and the Australian dollar will reach the initial SSL line (0.7265) of the Minuette operational scale fork.

The AUD/USD movement options from August 14, 2020 are shown on the animated chart.

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US dollar vs Canadian dollar

The development of the movement of the Canadian dollar USD/CAD from August 14, 2020 will occur depending on the development and direction of the breakdown of the range:

  • resistance level of 1.3245 - the lower border of the channel 1/2 Median Line Minuette;
  • support level of 1.3195 - the upper border of the ISL38.2 balance zone of the Minuette operational scale forks.

In the breakdown of the resistance level of 1.3245, the movement of USD/CAD will begin to flow in the channel borders 1/2 Median Line (1.3245 - 1.3265 - 1.3280) of the Minuette operational scale fork with the prospect of reaching the zone boundary equilibrium (1.3295 - 1.3375 - 1.3455) of the Minute operational scale fork.

In case of breakdown of ISL38.2 Minuette - support level of 1.3195 - the development of the Canadian dollar movement will continue in the equilibrium zone (1.3195 - 1.3165 - 1.3135) of the Minuette operational scale fork with the prospect of reaching the FSL Minuette final line (1.3035) and the SSL initial line (1.3025) of the Minute operational scale fork.

Options for USD/CAD movement from August 14, 2020 are shown on the animated chart.

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New Zealand dollar vs US dollar

The movement of the New Zealand dollar NZD/USD from August 14, 2020 will also develop depending on the development and direction of the range:

  • support level of 0.6580 - the lower border of the channel 1/2 Median Line Minuette;
  • support level of 0.6580 - the initial SSL line of the Minuette operational scale fork.

The joint breakdown of the initial SSL line of the Minuette operational scale fork - support level of 0.6560 - and ISL38.2 Minute (0.6550) will confirm that further development of the NZD/USD movement will proceed within the boundaries of the operational scale fork equilibrium zones - Minute (0.6550 - 0.6500 - 0.6455) and Minuette (0.6455 - 0.6420 - 0.6385).

The breakdown of the resistance level of 0.6580 will return the development of the movement of the New Zealand dollar to the boundaries of the 1/2 Median Line channels of the operational scales - Minuette (0.6580 - 0.6595 - 0.6610) and Minute (0.6605 - 0.6630 - 0.6660) with the possibility of updating the local maximum 0.6688 and the initial SSL line (0.6695) of Minute operational scale fork.

The markup of NZD/USD movement options from August 14, 2020 is shown on an animated chart.

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____________________

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

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

Overview of the EUR/USD pair. August 14. The US economy shrank due to the pandemic twice as much as the EU economy. Trump

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: 66.8115

The EUR/USD currency pair on the penultimate trading day of the week continued to move Wednesday, that is, an upward movement. However, all these movements occur within the side channel 1.17-1.19, which we have already discussed in previous articles. By and large, now there is a classic situation "some can't, others don't want to". The bears now simply do not have the strength, desire and reason to sell the pair. The US dollar looks extremely shaky, as does the US economy, which lost a record 33% in the second quarter. Much more than any country in the European Union and the EU as a whole. Thus, for simple economic reasons, the US dollar does not look attractive from the point of view of investment. Moreover, the American economy does not look attractive either. As we said, it lost 33% in the second quarter, but how quickly it will recover is unknown. Naturally, the President of the country, Donald Trump, has already declared a "Golden age", which the country will enter very soon, hinting at his own re-election in order for this "Golden age" to come. However, Trump has been misled more than 20,000 times during his 4 years in office. To make unfounded, unsubstantiated, absurd statements to the President of the United States - business as usual, boring Monday. Thus, there is simply no trust in his words. But there is confidence in the words of Anthony Fauci, who says that the "coronavirus" epidemic has become uncontrolled. There is confidence in Jerome Powell, who says that the economic recovery will be long and very difficult, and also notes that much will depend on the results of the fight against the "coronavirus". And there is trust in Joe Biden, who has not yet been caught in a lie or made absurd statements. And, as you know, Joe Biden believes that after Donald Trump, America will have to be restored. In principle, this is true. Because it was under Trump that the US entered the most severe crisis since the Great Depression. Trump offers his voters, roughly speaking, to give him a second chance and allow him to restore everything that collapsed under him. Why would the Americans do that? After all, for example, the EU economy, which experienced the same crisis, went through the same pandemic, lost only 12% in the second quarter, and the virus itself was localized. Yes, there are new outbreaks in some European countries, such as in France or Spain. However, in the United States, even the first wave has not yet ended, and the number of daily recorded cases of diseases is off the scale even now, when the epidemic is on the wane. Thus, American voters can ask Trump, who is just famous for his work with the economy, why the EU lost 12% of GDP, and America – 33%? Almost three times as much? Based on these considerations, we continue to believe that the topic of "coronavirus" and the topic of elections are now the two main topics for America and the US currency.

Meanwhile, no sooner did we write in yesterday's article that Joe Biden made a great "horse move" by appointing Kamala Harris as his Vice-President, than the British newspaper The Guardian wrote about it. In her opinion, this choice of Biden will help him get a lot of new votes in the election. Journalists of the British tabloid believe that at the time of the mass social movement "Black Lives Matter" it is the arrival of a black politician to power that can help ease the tension that has arisen between people of different nationalities and skin color. Now women can vote for Biden, black Americans who previously did not want to vote for him. Trump, who was accused more recently of racism, who during his reign several times publicly insulted women (speaker of the House of Representatives Nancy Pelosi, journalists who asked him uncomfortable questions), is clearly not popular among the beautiful half of the population, as well as among the black population. This is the situation obtained 2.5 months before the election in the United States.

As for traders of the EUR/USD pair, they are waiting. They are waiting for the situation to clear up, waiting for new major players to enter the currency market, waiting for a change in the mood of major traders, waiting for new high-profile news and events. As we found out during the previous weeks, ordinary reports like inflation or even GDP are not enough for traders to take the pair out of the formed side channel of 1.17-1.19. Thus, tomorrow's publication of Eurozone GDP for the second quarter, which may result in a fall of 15% in annual terms and 12.1% in quarterly terms, is unlikely to help the European currency in principle, and even more so to get the pair out of the flat. Several relatively important reports will also be published in America, but they are unlikely to help traders leave the side channel. Retail sales in the United States in July may grow by 1.9%, and industrial production - by 3%. We believe that a strong reaction from private market participants will follow only if the actual values of these reports differ significantly from the forecast ones.

From a technical point of view, the euro/dollar pair reached the upper area of the side channel. Thus, around the 1.19 level, we expect the price to turn down and fall further. Yes, after overcoming the previous two local highs (1.1911), the upward movement may continue with renewed vigor, but we recommend that traders buy the euro very carefully in this case, since buying a currency near its two-year peaks is quite a dangerous occupation. The main thing is not to forget about security and set stop-loss. We remind you that in addition to the fact that the European economy lost much less during the crisis than the American one, the euro currency no longer has any trumps. Recall that the ECB rates remain negative for a long time and even after the Fed lowered its rates, they still remain more "dovish" in Europe. Moreover, traders have been engaged in the past three months in exactly the same way that they worked out the strong fall in the US economy and the relentless COVID-2019 pandemic. The currency cannot constantly grow on the same factors, otherwise the British pound would already be near price parity with the dollar due to Brexit.

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The volatility of the euro/dollar currency pair as of August 14 is 93 points and is characterized as "high". Thus, we expect the pair to move today between the levels of 1.1723 and 1.1909. The reversal of the Heiken Ashi indicator downwards signals a turn of the downward movement within the side channel of 1.1719 – 1.1911.

Nearest support levels:

S1 – 1.1719

S2 – 1.1597

S3 – 1.1475

Nearest resistance levels:

R1 – 1.1841

R2 – 1.1963

Trading recommendations:

The EUR/USD pair continues to trade near the sideways moving average, which indicates a flat. Thus, at this time, it is recommended to either trade between the borders of the side channel based on the signals of the Heiken Ashi indicator, or wait for the end of the flat and the resumption of the trend movement.

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

EUR/USD. "EU is as bad as China": Trump's words interrupted the upward offensive

The fundamental background for the euro-dollar pair changes at a kaleidoscopic speed. Despite the dominance of bullish sentiment, EUR/USD bears are not going to give up without a fight. Sellers use any more or less significant news reason to slow down the growth of EUR/USD, although they are not yet able to reverse the trend. However, their counter-attacks bear fruit: for example, they did not allow the pair's bulls to approach the 19th figure today, although there were all the prerequisites for this since the morning. But in the afternoon, the fundamental background for the euro was overshadowed by US President Donald Trump's remarks. Therefore, buyers had to postpone their attack on the 19th price level.

What happened?

Before the coronavirus pandemic, the main topic for traders was the trade war between the United States and China. The negotiation epic lasted for several years and ended last fall with the signing of the first part of the trade deal. In the shadow of this trade conflict was (and still is) another – between the US and Europe. It has also been smoldering for several years – almost as long as Trump is "at the helm". Periodically, he recalls this trade standoff, threatening Brussels with additional duties and other "punishments from heaven". This conflict is heterogeneous – for example, the head of the White House in 2018 threatens to impose additional duties on European cars and spare parts. The automotive industry is under attack not only in Germany, but also in France and Italy.according to preliminary estimates, the total cost of these duties is worth 300 billion dollars. These intentions remained intentions, but the other line of conflict – in the sphere of aircraft construction – ended with the introduction of additional duties for billions of dollars.

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Washington voiced its claims to the Europeans in April 2019: according to the White House, a number of European countries (France, Italy, Spain and Germany) illegally subsidized the European aircraft manufacturer Airbus, causing the American state annual damage worth 11 billion dollars. The United States then only threatened to impose additional duties on a number of goods from the above-mentioned European countries. A little later – in October 2019 – Brussels lost a dispute at the World Trade Organization over subsidies for Airbus. This fact became the next stage in the trade standoff between the US and the European Union. Washington has imposed additional tariffs worth $7.5 billion, sanctioned by the WTO, on a number of goods imported from the European Union. In particular, a 10% tariff was imposed on civil aircraft, and a 25% tariff was imposed on food and alcoholic beverages.

The United States has just announced that it has extended the additional duties. However, with a few changes: Washington excluded some products from the UK and Greece from the list, including "a comparable volume of products from France and Germany". A detailed list of products is not yet available, but in the context of the currency market, this is not so important. But another reminder of the tense trade relations between the US and the EU had a negative impact on the euro. Especially since Trump also focused on this.

"The EU is as bad as China": many journalists around the world put this particular phrase from Trump in the headlines of their publications. In an interview with Fox Business, Trump quite harshly criticized the EU, saying that the EU "uses the US". Initially, it was about payments to the NATO budget, but then the American president recalled the trade relations between Washington and Brussels. Against the backdrop of such rhetoric, some experts have suggested that the trade war between the United States and the EU will continue, thereby aggravating the situation of the world economy.

Although there is no consensus among analysts on this issue, the European currency was still under some pressure. Buyers of the EUR/USD pair could not continue the upward offensive, retreating to the bottom of the 18th figure.

How do I trade?

At the moment, the pair is showing a downward correction after rising to a local high of 1.1864 (current week's high). The growth in prices was due to pessimistic comments by Federal Reserve representatives and "silence" in the US Congress. Earlier this week, Treasury Secretary Steven Mnuchin promised that talks over a new stimulus package would resume, but "things are still there." Such a fundamental background allowed the pair's buyers to overcome the resistance level of 1.1805 (Tenkan-sen line on the daily chart) and head towards the 19th figure.

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Now the bears are trying to bring the price back under the above level. Therefore, the 1.1805 target is now a key level: if buyers can stay above it, they will again head towards the 19th figure. Otherwise, bearish sentiment will intensify, and the pair may drop to the support level of 1.1710 (middle line of the BB indicator on the daily chart).

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