Today is a very important day of the year. Overview of USD, NZD, AUD

The sale of risky assets, together with a clear growth in the US yield bonds stopped last night, while stock indices partially recovered their loss. Therefore, transitioning to the green zone most likely indicates that players' confidence is rising that Joe Biden will win the US presidential elections. Trump, in turn, who began to win back its loss in the middle of last week (which was particularly due to the demand for defensive assets), will not have time to close the gap.

For the economies of Australian and New Zealand, these are unusual moments. As the second wave of COVID-19 is gaining impulse in the Northern hemisphere, forcing countries to tighten their restrictive measures, summer is approaching in the Southern hemisphere. We are aware that summer is accompanied by a sharp decline in the number of COVID-19 cases. As a result, business activity in New Zealand and Australia is likely to recover and return to normal, which should be accompanied by both an increase in domestic demand and a reduction in the need to introduce new incentives. It is no coincidence that the RBNZ postponed consideration of the issue of negative rates and QE expansion for April just before the onset of winter.

Unfortunately, both Australia and New Zealand are export-oriented countries, so the growth in business activity may well not provide the necessary impulse for economic growth due to the sharply reduced external demand, which is largely determined by the demand in the US and Western Europe. Inflation is well below the target across the board, and as the pandemic widens, there is little hope of rising consumer demand.

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Today, we expect the trend which developed last night will continue – attempts to resume oil growth, the sale of protective assets and the demand for risk. According to forecasts, Democrats can gain control of the Senate, which is highly likely to end the trade wars that Trump has waged over the past few years. Thus, markets regard this prospect as positive.

NZDUSD

The New Zealand dollar is trading in a range with no clear direction. A week ago, the priority seemed to be leaving the range up, but since Monday, the estimated price has turned down even despite a number of positive signals (CME net long position rose by 35 million to 469 million), remaining above the long-term average, which reduces the chances of resuming growth.

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New Zealand's economic state looks clear for the majority of banks actively operating in the country – it is expected that the RBNZ will reduce the rate to negative levels in April, but before that, it will most likely announce this month that there will be an expansion of its lending program aimed at supporting business activity amid falling external demand. The RBNZ meeting will be held on November 11, and the results of the US elections will be known by that time, so the current given forecast is very uncertain.

The NZD still looks better compared to AUD, and its momentum is directed below. On the other hand, the NZD/USD pair remains in a narrow range while it awaits the result of the US election. If Democrats win, the price will consolidate above the level of 0.6720, with a goal at 0.6930/50. Any other result will cause the New Zealand dollar to decline to 0.6480 and strengthen the US currency.

AUDUSD

The Australian dollar's net long position reached 634 million, as it rose by 158 million over the week. However, this bullish signal does not have much effect on the AUD prospects, since the situation remained neutral or with a slight negative advantage by other criteria. The target price is below the long-term average and tends to decline further. Therefore, we have low chances to continue rising.

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An RBA meeting will be held tomorrow, and so, most experts expect the rate to be cut to 0.10% and some targets to be lowered. Perhaps, the RBA will announce the start of targeted asset purchases. These expectations currently dominate the expert community and put additional pressure on the AUD.

Technically, AUD/USD remains within the limits of the descending channel. The target is 0.6775/95, as long as capital flows support the downward trend of AUD, despite Democrat's likely victory.

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Analysis and trading recommendations for the EUR/USD and GBP/USD pairs on November 3

Analysis of transactions in the EUR / USD pair

The bears failed to maintain their control over the market, so as a result, the EUR / USD pair rose a bit yesterday.

To add to that, rather good economic reports came out from Europe. However, they may turn down this 4th quarter amid new quarantine restrictions imposed in many EU countries.

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Trading recommendations for November 3

Of great importance is the results of the US presidential elections, as it will determine whether the US dollar will maintain its position in the market, or weaken against other currencies such as the euro. If Joe Biden wins, the US dollar will weaken sharply. In that case, long positions will be a more correct decision, since from a technical point of view, going beyond the sideways channel 1.1631-1.1661 will lead to a new wave of growth in the EUR / USD pair.

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  • Open a long position when the euro reaches a quote of 1.1661 (green line on the chart), and then take profit at the level of 1.1716. However, growth will only occur if Joe Biden wins the US presidential elections.
  • Open a short position when the euro reaches a quote of 1.1631 (red line on the chart, and then take profit around the level of 1.1579. However, a decline will only occur if Donald Trump wins the US presidential elections, as such will give the markets strong confidence in a stable future.

Analysis of transactions in the GBP / USD pair

Although short positions from 1.2906 moved the pound down by more than 40 pips, the bears failed to maintain their control over the market, so as a result, the GBP/USD pair rose a bit yesterday.

To add to that, there are rumors that negotiations over the post-Brexit trade deal are progressing smoothly, thus, a further price decline is now unlikely to happen in the GBP/USD pair.

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Trading recommendations for November 3

Of great importance is the results of the US presidential elections, as it will determine whether the US dollar will maintain its position in the market, or weaken against other currencies such as the British pound. To add to that, good news over Brexit negotiations will raise demand for the pound in the short term.

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  • Open a long position when the quote reaches the level of 1.2939 (green line on the chart), and then take profit around the level of 1.3002 (thicker green line on the chart).
  • Open a short position when the quote reaches the level of 1.2906 (red line on the chart), and then take profit at least at the level of 1.2856. Bad news on Brexit, as well as Trump's victory on the US presidential elections, will continue the downward trend in the GBP / USD pair.
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Indicator analysis. Daily review on GBP/USD for November 3, 2020

Trend analysis (Fig. 1).

Today, the market will try to continue moving up from the level of 1.2919 (closing of yesterday's daily candlestick) in order to reach the pullback level of 38.2% - 1.2982 (blue dotted line). If this level is tested, the upward movement will continue with the target of 1.3078 - the pullback level of 50.0% (blue dotted line).

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Figure 1 (Daily Chart).

Comprehensive analysis:

  • Indicator analysis - up
  • Fibonacci levels - up
  • Volumes - up
  • Candlestick analysis - up
  • Trend analysis - down
  • Bollinger bands - up
  • Weekly chart - up

General conclusion:

Today, the price from the level of 1.2919 (closing of yesterday's daily candlestick) will attempt to continue moving up in order to reach the pullback level of 38.2% - 1.2982 (blue dotted line). If this level is tested, the upward movement will continue with the target of 1.3078 - the pullback level of 50.0% (blue dotted line).

Unlikely scenario: the price from the level of 1.3043 (closing of yesterday's daily candlestick) works up to reach the resistance line - 1.2941 (red bold line). If this line is tested, work downward to the target of 1.2867, which is a pullback level of 61.8% (red dotted line).

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Elliott wave analysis of GBP/JPY for November 3, 2020

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After an uneventful overnight trading session, today we are expecting more clear shifts. Contrary to EUR/JPY, the trajectory of GBP/JPY is difficult to forecast. The options remain multiple. Our preferred count shows that GBP/JPY completed a larger corrective decline in March with the dip to 124.09 and has started a new impulsive rally towards at least 157.65 and the longer-term closer to the 2015 peak at 195.88. We need a clear break above the wave 1/ peak at 142.72 to confirm that wave 3/ higher is in motion towards at least 147.49 on the way higher towards 157.65.

However, as long as minor resistance at 138.04 is able to cap the upside, we cannot exclude a larger correction in wave 2/ closer to 129.70 to complete the corrective wave 2/.

R3: 148.18

R2: 142.72

R1: 138.04

Pivot: 133.05

S1: 129.70

S2: 126.55

S3: 124.09 - Can't be broken or we will be forced to a recount of our long-term scenario

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Indicator analysis. Daily review for the EUR / USD currency pair 03/11/2020

Trend analysis (Fig. 1)

Today, from the level of 1.1640 (the closing of yesterday's daily candle), the market can continue to move up with the goal of 1.1683 which is a pullback level of 23.6% (blue dotted line). If this line is tested, further upward work is possible with the goal of 1.1720 which is a pullback level of 39.2% (blue dotted line).

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Figure 1 (daily chart).

Complex analysis:

  • Indicator Analysis – up
  • Fibonacci Levels – up
  • Volumes – up
  • Candle Analysis – up
  • Trend Analysis-up
  • Bollinger Bands – up
  • Weekly Chart - the up

General conclusion:

Today the price may continue to move up with the target of 1.1683 which is a pullback level of 23.6% (blue dotted line). If this line is tested, further upward work is possible with the goal of 1.1720 which is a pullback level of 39.2% (blue dotted line).

Unlikely scenario: When moving up and reaching the pullback level of 14.6% - 1.1659(blue dotted line), the price may start moving down to the support level of 1.1622 (white bold line).

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Technical Analysis of GBP/USD for November 3, 2020

Technical Market Outlook:

The GBP/USD pair keeps going lower in a descending channel and another lower low was made at the level of 1.2854, which is at the short-term trend line support. The candle on the H4 time frame chart that made the low looks like a Pin Bar, so the bulls are defending the trend line support. Any sustained violation of this trend line will indicate more bearish pressure that can push the prices to the level of 1.2868, 1.2848 or even 1.2816. The weak and negative momentum supports the short-term bearish outlook despite the oversold market conditions. Only a sustained breakout above the level of 1.2982 would change the intraday outlook to bullish.

Weekly Pivot Points:

WR3 - 1.3236

WR2 - 1.3153

WR1 - 1.3037

Weekly Pivot - 1.2956

WS1 - 1.2835

WS2 - 1.2757

WS3 - 1.2653

Trading Recommendations:

The GBP/USD pair is in the down trend on the monthly time frame, but the recent bounce from the low at 1.1411 made in the middle of March 2020 looks very strong and might be a reversal swing. In order to confirm the trend change, the bulls have to break through the technical resistance seen at the level of 1.3518. All the local corrections should be used to enter a buy orders as long as the level of 1.2674 is not broken.

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Technical Analysis of EUR/USD for November 3, 2020

Technical Market Outlook:

The EUR/USD pair keeps making lower lows, but recently the gulls have managed to break out of the descending channel and hit the technical resistance at the level of 1.1655. The momentum is weak and negative and the market conditions at the H4 time frame chart are extremely oversold, so please keep an eye on a temporary rebound. The nearest technical resistance is seen at the level of 1.1695. Bears are in full control of the market and the weekly outlook is bearish despite the election night in the USA.

Weekly Pivot Points:

WR3 - 1.1974

WR2 - 1.1916

WR1 - 1.1756

Weekly Pivot - 1.1698

WS1 - 1.1531

WS2 - 1.1471

WS3 - 1.1314

Trading Recommendations:

Since the middle of March 2020 the main trend is on EUR/USD pair has been up, which can be confirmed by almost 10 weekly up candles on the weekly time frame chart and 4 monthly up candles on the monthly time frame chart. The recent correction towards the level of 1.1612 seems to be completed and now market is ready for another wave up. This means any local corrections should be used to buy the dips until the key technical support is broken. The key long-term technical support is seen at the level of 1.1445. The key long-term technical resistance is seen at the level of 1.2555.

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Trading plan for the EUR/USD pair on November 3. COVID-19 and the US presidential elections.

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As of Tuesday morning, the United States has again recorded near record highs of new COVID-19 cases, same with Europe, which continues to see a high incidence rate in many countries.

Latest data indicates that France already has 52 thousand new cases a day, while 9 European countries have above 11 thousand per day. Because of this, quarantine has been reintroduced in many states, namely Britain, Germany, Austria, Switzerland and Italy.

Nonetheless, many hope that this is already the peak of the second pandemic wave, or if not, approaching it already.

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The US market is currently near two-month lows, and if Joe Biden wins the US presidential elections, the market will go down even lower.

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EUR/USD - The euro is in a downward trend.

Long positions may be set up from 1.1710. However, a decline is more likely to happen, thus, it would be better to open short positions from the level of 1.1680.

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Technical Analysis of ETH/USD for November 3, 2020

Crypto Industry Outlook:

Almost a quarter of the circulating supply of Ethereum (ETH) is stored on cryptocurrency exchanges, according to data from the ViewBase analytical platform.

This page shows that there are 26,768,260 ETH on the exchanges, corresponding to 23.6% on a value of $ 10.3 billion. Almost 26 million of these tokens are held on 10 centralized exchanges, and Coinbase alone holds 8,521,807 ETH, or 7.5% of the supply.

Ether is ahead of Bitcoin by many miles in terms of the percentage of tokens held on exchanges. BTC has 8.1% of its supply in circulation on exchanges.

According to Glassnode, the number of Bitcoins stored on exchanges dropped significantly over the year, going down from a record high of 2.97 million BTC in February to below 2.6 million yesterday. The platform also shows bullish signals for Bitcoin with daily new addresses for BTC around 480,000, which is six times more than for Ether, which has less than 80,000 new addresses created each day.

Glassnode does not reflect the same percentage of coins held in exchanges as ViewBase. There are less than 16.6 million ETH (14.7%) and almost 2.6 million BTC (14%) on the exchanges, according to Glassnode.

Technical Market Outlook:

The ETH/USD pair has moved lower and hit the technical support at the level of $369.37 as anticipated after the rally was capped by the trend line resistance around the level of $403.05. The momentum is now weak and negative, which indicates a possibility of another wave down towards the level of $362.60 and $355.60. If a daily candle closes below $360 level, then the bears will have full control of the market.

Weekly Pivot Points:

WR3 - $456.03

WR2 - $431.91

WR1 - $415.05

Weekly Pivot - $393.33

WS1 - $376.79

WS2 - $355.02

WS3 - $337.80

Trading Recommendations:

The up trend on the Ethereum continues and the next long term target for ETH/USD is seen at the level of $500, so any correction or local pull-back should be used to open the buy orders. This scenario is valid as long as the level of $309.61 is broken.

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Elliott wave analysis of EUR/JPY for November 3, 2020

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Without much action overnight, we think that it might be wise to take a step back and look at the larger picture. In April 2020 we concluded that wave (E) of the huge multi-year [B]-wave triangle bottom and a new long-term impulse rally in wave [C] has begun. We are still in the early days of this new impulsive [C] that ultimately should move above the peak of wave [A] at 169.97. To confirm this scenario the pair needs to break clearly above the triangle-resistance line near 127.07. A break above here calls for much more upside pressure with resistance at 137.50 as the first major target.

As long as the pair remains locked inside the triangle almost everything can happen as wave (E) can turn into a mini-triangle itself within the boundaries of the larger triangle. It is not our favorite count but at this point, it still cannot be excluded.

R3: 129.68

R2: 127.07

R1: 125.16

Pivot: 122.62

S1: 121.62

S2: 119.12

S3: 116.60

We are long EUR from 122.25 with our stop placed at 121.60

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Technical Analysis of BTC/USD for November 3, 2020

Crypto Industry Outlook:

A large private Russian bank, Gazprombank, has received regulatory approval to launch cryptocurrency storage services through its Swiss company.

According to the official announcement, the bank has obtained approval from the national financial regulator, the Swiss Financial Market Authority, to offer cryptocurrency storage and trading services to its institutional and corporate clients. The offers will initially be limited to a select group of customers with Bitcoin as the only supported cryptocurrency. Gazprombank plans to gradually expand its offer with additional cryptocurrencies and other related products and services.

President of Gazprombank Roman Abdulin said:

"We expect digital assets to become increasingly important in the global economy, especially for our existing and potential customers."

As a regulated entity, Gazprombank will have to comply with Swiss anti-money laundering and AML laws and regulations, and implement its own due diligence and software procedures.

Gazprombank Switzerland is a bank registered in Switzerland, 100% owned by Gazprombank based in Russia. The bank is preparing to launch cryptographic services in Switzerland from 2018.

Technical Market Outlook:

The BTC/USD pair has moved back into the horizontal channel after a failure to rally higher above $14,000. The recent local low was made at the level of $13,147. The market conditions are extremely overbought on H4 and daily time frame, so a pull-back or correction might occur any time now. The nearest technical support is seen at the levels of $13,296 and $13,116. The key technical support is located at $12, 625.

Weekly Pivot Points:

WR3 - $15,648

WR2 - $14,723

WR1 - $14,351

Weekly Pivot - $13,475

WS1 - $13,116

WS2 - $12,252

WS3 - $11,845

Trading Recommendations:

Bitcoin is trading at the yearly highs and bulls are in control of the market. The up trend continues and the next long term target for Bitcoin is seen at the level of $14,000, so any correction or local pull-back should be used to open the buy orders. This scenario is valid as long as the level of $10,000 is broken.

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Will the US dollar collapse if Biden wins the election?

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The US dollar experiences the strongest volatility on the day of the US presidential election, which is not surprising as it is the key currency that initially mirrors any political change. In view of this, experts are uncertain how much Biden's victory will affect the dollar's dynamics.

Analysts from MUFG say that the so-called "blue wave" scenario will become the most unfavorable result of the electrons for the US dollar. Considering this happens, the Democrats will be in control of the key departments – the Senate, the House of Representatives and the White House. They believe that this will give many people hope for further serious financial aid and increased fiscal stimulus. Moreover, their victory will provide significant support for risky assets and significantly weaken the dollar. In the event of a different result, that is, Donald Trump will be re-elected, the US currency will be in an upturn again.

However, there is another opinion. It says that the US dollar's further dynamics does not rely on the US presidential election. According to Federico Garcia Zamora, head of emerging market debt at BNY Mellon Investment Management, whoever wins the election, either Mr. Biden or Mr. Trump will not have a decisive effect on the dollar. Regardless of the election results, the expert recommends reducing or hedging investments denominated in USD. At the same time, he does not exclude that the victory of Joe Biden will cause the dollar to rapidly decline. In contrast, D. Trump remaining in his post will temporarily keep the dollar from declining, but it is unlikely to slow down its decline for a long time. Thus, experts believe that the re-election of the current president will further stimulate the economy.

At the same time, many analysts are confident that the USD will depreciate in the long term, which will be primarily due to economic reasons, not politics. At the moment, it is actively defending its dominant position. This significantly affects the dynamics of the EUR/USD pair. On the first day of this crucial week, the pair approached the lows recorded since September 2020. Experts do not rule out the possibility of the EUR/USD pair moving below the level of 1.1600 even before the summarization of election results. Today, the EUR/USD pair was trading near 1.1654-1.1655, trying to leave this range. If it declines below the level of 1.1500, it should hold this line as long as possible, since breaking through which threatens the long-term rise of the EUR/USD pair.

Experts also admit that if Mr. Biden wins, the US dollar will probably be pushed further below. If this happens, the indicated currency should do its best to survive negative consequences. However, there are only slight chances that there will be an additional impulse that can support the strength of the USD which can lead it upwards.

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Bank of England held again the fall of the pound at 1.2898

Holding the level of 1.2898 indicates the importance of the banking zone for further priority determination. The probability of closing today's trading above this mark is 75%, which allows you to close part of the sales that opened last week. A further drop will be possible after tomorrow's opening of the European session. The downward trend may become the main one for the first half of the month.

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We get a huge advantage by working from the boundaries defined by the Bank of England, since the presence of large limit orders keeps the price from a strong rise or fall.

To form a reversal growth model, you will need to close tomorrow's trading above the opening of the European session. This will open the way for the strengthening of the British pound and make it possible to enter into medium-term purchases. Tomorrow, you will need to adjust the plan as a new zone of banking activity will appear.

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The fall of EUR/USD stopped again at the banking support zone

The probability of growth from current levels is increasing significantly due to the fact that the support zone formed by bank liquidity was tested. It is important to note that the pair fell by 1%, indicating the impulsive nature of the bearish movement. The first growth target is the start point of operations on the open market ECB 1.1765. The possibility of closing today's trading above this level is below 10%, which indicates the need to consider the further decline in the second half of this week as the main one.

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This is the second week that leads to a decrease from the level of bank opening of trading. The European Central Bank supports the pair's decline and makes it possible to continue working in a downward direction.

Working towards a corrective movement to return to the banking level of 1.1765 is possible. However, it is necessary to understand that a new zone will appear tomorrow, which may become a resistance. For this reason, purchases must be converted to breakeven and attention must be on tomorrow's formation of the reference point.

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AUD / USD Forecast for November 3, 2020

AUD / USD

In the last two days, the Australian Dollar the range of fluctuations increased against the background of mixed dynamics in the commodity markets and the upcoming elections in the US but in general the price does not move above the level of 0.7058. It is probably choosing it as a platform for working out the nested line of the price channel in the area of 0.6937. The Marlin oscillator is in the negative trend zone.

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On the four-hour chart, the Marlin signal line has returned to the border with the growth territory. From here, a downward turn is possible and the price may fall further. The first goal is 0.6970 and overcoming it will create a condition for a breakthrough to 0.6937. Fixing the price below this level opens up the prospect of further decline.

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USD/JPY Forecast for November 3, 2020

USD/JPY

The yen tried to overcome the price channel line yesterday at 104.83 with the help of a brisk growth of the stock market, but this first attempt failed. However, the Marlin oscillator left its own consolidation on the daily scale of the chart up. Its entry into the zone of positive values with the price fixed above 104.83 may extend the pair's growth towards the Kruzenshtern line to the area of 105.42.

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But such a scenario is highly questionable, since the stock market is most likely to fall after the first data from the US election. As a result, we expect the price to go below the first target level of 104.20 and decline to 103.73 (the top of may 2013).

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Based on the four-hour scale chart, the price is fixed above the balance and Kruzenshtern indicator lines. The Marlin oscillator is in the growth zone but when compared with the situation on the daily chart, it may very well turn out that this increase will be false. This will be confirmed by a decrease in the price under the Kruzenshtern line (104.50), and until then it is recommended not to trade.

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Forecast for GBP/USD on November 3, 2020

GBP/USD

The British pound reached the nearest target level of 1.2860 on Monday, afterwards it rebounded upward from it and entered the range on October 30. The signal line of the Marlin oscillator shows the intention to reverse from the border of the bears territory on the daily chart. If good Brexit data provides help to this, the pound will rise regardless of the outcome of the US elections. The first growth target is 1.3082.

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If we do not receive good news on Brexit, we are waiting for the pound at the target level of 1.2810, and for the currency to settle below it at the 1.2674 level.

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The Marlin oscillator has come close to the border of the growth area on the four-hour chart, but crossing the border will not become a condition for further price growth, but first the price should settle above the MACD line in the 1.2985 area. We are waiting for the development of events, the arrival of important political news.

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Hot forecast and trading signals for GBP/USD on November 3. COT report. Bears need to overcome 1.2855-1.2874 to keep falling

GBP/USD 1H

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The GBP/USD pair reached the support area of 1.2854-1.2873 on Monday, November 2 and failed to overcome it on the first attempt. In general, trading was rather calm on the first trading day of the week. The rebound was followed by a systematic increase in quotes, all within the descending channel. Thus, the trend for the pound/dollar pair remains downward at this time, and the bears continue to hold the initiative in their hands. As for the bulls, they now need to leave the channel through its upper border, as well as overcome the important Senkou Span B and Kijun-sen lines. An upward movement will mean a strengthening of the British currency, which will be possible if positive information comes from London on the progress of negotiations on the deal.

GBP/USD 15M

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Both linear regression channels turned to the downside on the 15-minute timeframe, which indicates a continuation of the downward movement on the hourly chart. However, the pair was not allowed to go down the 1.2854-1.2873 area, so the correction may continue for some time.

COT report

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The latest Commitments of Traders (COT) report on the British pound showed that non-commercial traders were quite active in the period from October 20-26. However, their sentiment changed again, as can be seen from the green line of the first indicator in the chart. The mood of the "non-commercial" group of traders became more bullish for three consecutive weeks, but the net position decreased by 5,000 contracts over the last reporting week, so we can conclude that professional traders are again inclined to sell off the pound. However, if you look at the COT reports over the past few weeks or look at the first indicator, it becomes clear that commercial and non-commercial traders do not have a clear trading strategy right now. Perhaps this is due to an extremely unstable and complex fundamental background. The fact remains. The pound lost 90 points in recent trading days, and we believe that it will continue to fall. However, in the near future, we might receive important information about the progress of negotiations on the UK-EU trade deal, and the results of the vote for the US president will also become known. This information can change the mindset of professional traders. You need to be prepared for this.

Fundamental background for GBP/USD remained unchanged on Monday. There is still no VERIFIED information on the progress of negotiations between the groups of Michel Barnier and David Frost. The US presidential elections will continue today, and no clear information about that yet. The UK published an index of business activity in the manufacturing sector, which, like European indices, turned out to be higher than forecasts and the value of September. However, the pound failed to extract special dividends from this. Markets are fully focused on more important fundamental topics, so they do not pay any attention to secondary macroeconomic publications. The US also released manufacturing PMIs, which also turned out to be higher than expected. The ISM index was 59.3 and the Markit index was 53.4. There are no major publications or other events scheduled in America and Britain other than the US presidential election on Tuesday. Thus, all the attention is paid to the American media, which will keep us informed of the voting progress.

We have two trading ideas for November 3:

1) Buyers for the pound/dollar pair failed to settle above the Kijun-Sen line. Thus, the initiative remains in the hands of the bears, and long positions, accordingly, are irrelevant. You can consider long deals again if the price settles above the Senkou Span B (1.3018) and Kijun-sen (1.2963) lines while aiming for the resistance area of 1.3160 - 1.3184. Take Profit in this case will be up to 110 points.

2) Sellers continue to pull down the pair, but yesterday they could not overcome the support area of 1.2855-1.2874. Therefore, you can consider new sell positions while aiming for 1.2855-1.2874 in case the price rebounds from the Kijun-sen line (1.2963). If this area is overcome, you are also advised to trade down while aiming for the support level of 1.2768. Take Profit in the first case will be up to 80 points, in the second - up to 70.

Hot forecast and trading signals for EUR/USD

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 are 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 are trend lines, trend channels and any other technical patterns.

Indicator 1 on the COT charts is the size of the net position of each category of traders.

Indicator 2 on the COT charts is the size of the net position for the "non-commercial" group.

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

Hot forecast and trading signals for EUR/USD on November 3. COT report. Will there be a storm in the market due to US elections,

EUR/USD 1H

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The euro/dollar pair tried to continue moving down on the hourly timeframe on Monday, November 2, but it came across the support area of 1.1612-1.1624, from which the quotes had already rebounded off. This was the notorious exit from the horizontal channel, afterwards the price returned to it very quickly. Thus, a rebound from this area and this time can provoke an upward movement. We also built a new downward trend line, which has four pivot points at once and is on the verge of breaking. Therefore, the price rebound from 1.1612-1.1624, coupled with breaking the trend line, may indicate a new round of upward movement for the pair. Unfortunately, today a lot will depend on the fundamental background, or rather, on the course of the US elections. Therefore, we can expect increased volatility during the day.

EUR/USD 15M

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Both linear regression channels are still directed to the downside on the 15-minute timeframe, which speaks volumes about the current trend on the hourly chart and indicates that there are no signs of starting a tangible upward correction.

COT report

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The EUR/USD pair rose quite a bit during the last reporting week (October 20-26). Therefore, we can conclude that professional market participants did not make any extremely large purchases and sales of the European currency. However, the new Commitment of Traders (COT) report showed that non-commercial traders were actively closing Buy-contracts (longs) during the reporting week. In total, 12,000 of them were closed. But professional traders were in no hurry to get rid of Sell-contracts (shorts), having closed only 1,000. Thus, the net position of this group of traders decreased by 11,000 contracts at once. It is possible that the main closing of the Buy-contracts took place at the end of the reporting week, because in the following days a more tangible drop in euro's quotes began. Within its framework, the euro/dollar pair lost about 160 points. We remind you that if the net position decreases, it means that the traders' sentiment becomes more bearish. Thus, so far, our forecast is coming true. In the analysis of previous COT reports, we said that the high around the 1.2000 level could remain as the peak for the entire upward trend. The first indicator and its green line clearly show that non-commercial traders have been cutting back on long deals on the euro for two months now. And non-commercial traders are the most important group of large traders in the foreign exchange market. It is believed that it is the one responsible for driving the market.

The indexes of business activity in the manufacturing sectors for October were published in European countries and the European Union as a whole. It turned out that despite the second wave of the pandemic that had already begun by that time, all business activity indices exceeded their forecasted and previous values. However, this did not come as some kind of surprise, since we have already said that with the new lockdown, the service sector will suffer in the first place. Therefore, to assess the impact of the pandemic and the new lockdown on the economy, we are waiting for data from the service sector. No important publication of macroeconomic reports scheduled in America and the European Union on Tuesday. However, traders would hardly have paid attention to them anyway. Presidential elections will be held in the United States today, and although the results should be expected a little later, nevertheless, many fear that the voting procedure in many cities will be accompanied by riots and clashes between supporters of Biden and Trump. Events like this can trigger a reaction in the foreign exchange market. And, most likely, unfavorable for the US dollar.

We have two trading ideas for November 3:

1) The EUR/USD pair continues to move down. And so buyers are advised to wait for more favorable conditions to open long positions than now. For example, if the price settles above the 1.1691-1.1698 area. In this case, you can open small longs with the targets of the Kijun-sen line (1.1732) and the Senkou Span B line (1.1784). Take Profit in this case can be up to 70 points.

2) Bears are actively trading, but gradually, pulling down the pair. Therefore, sellers are advised to continue to trade down while aiming for support levels of 1.1571 and 1.1496, if the price settles below the 1.1612-1.1624 area. Take Profit in this case can be up to 90 points. When opening any position today, remember that volatility can be very high during the day due to the US elections.

Hot forecast and trading signals for GBP/USD

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 are 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 are trend lines, trend channels and any other technical patterns.

Indicator 1 on the COT charts is the size of the net position of each category of traders.

Indicator 2 on the COT charts is the size of the net position for the "non-commercial" group.

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

Overview of the GBP/USD pair. November 3. Media: Michel Barnier and David Frost managed to reach a compromise on the "fish

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - downward.

Lower linear regression channel: direction - upward.

Moving average (20; smoothed) - downward.

CCI: -98.6428

The British pound sterling paired with the US currency on the first trading day of the week also traded with a slight decrease, but with fairly low volatility. Traders are already fully focused on the upcoming US elections, and do not want to take unnecessary risks. Thus, by and large, nothing new can be said now. In America, it all comes down to today's election, and in the UK, it all comes down to Brexit and negotiations on a trade deal between London and Brussels, and on which there is still no new information. Thus, traders still have nothing to pay attention to and nothing to react to. Just rumors, speculation, and expectations.

Meanwhile, a new batch of rumors did arrive from London. This time, the British media say that Michel Barnier and David Frost managed to reach a compromise on the most important issue – the issue of fishing. The British media write that "the deal is almost reached", although it remains unclear why this particular wording is present, and how the remaining controversial issues are resolved. However, the publications also report that the new agreements on British waters will not appeal to those who voted for the country's exit from the EU. Boris Johnson has previously promised that the UK will regain full control of British waters, but things are moving towards the fact that European fishermen will have access to British waters next year. According to media reports, Britain insists on certain fish quotas, which must be reviewed annually, while the European Union insists on more specific and precise guarantees of access to British waters. However, if all the information provided is true, then this is a breakthrough in the negotiations and a deal can be concluded in the near future. If so, this is great news for the UK economy and the British pound. Of course, some damage to the economy will still be caused by the country's withdrawal from the EU, this cannot be avoided, but now it will be largely mitigated due to the existence of a trade agreement.

Meanwhile, Brexit leader Nigel Farage, one of the ideologues of all Brexit, has renamed his party to "Reform UK" and believes that the British government has cornered itself with a new lockdown and is going to fight against the "coronavirus". Farage believes that quarantine and isolation are necessary only for the most vulnerable categories of citizens, and not for the whole country. "The government has buried itself in a hole with the coronavirus and, instead of admitting mistakes, continues to dig further," Farage believes. "A new lockdown will lead to the loss of more lives than could have been saved, as patients without COVID-19, but with various other diseases, will again have to postpone or cancel a treatment. Suicide cases will increase. Businesses and jobs are dying." According to the leader of the "Brexit" party, one must learn to live with the virus, and not constantly hide from it in fear.

At the same time, US President Donald Trump criticized at one of his campaign rallies the measures taken by the European authorities to contain the "coronavirus". "Europe introduced draconian restrictions, and the number of cases and deaths still increased. Think about it. Now they're doing it again. Why the hell are they doing this? I thought about going and explaining to them, but they closed parts of Europe again," Trump said. Thus, the American President continues to stand by his initial opinion about the "coronavirus". According to the US President, this virus is not as terrible as it seems, and it is unacceptable to stop the economy of an entire country because of it. Thus, if one of the readers was going to move to the United States or Europe, there is still an opportunity to change their decision, since the attitude to healthcare in these locations is radically opposite. Trump continues to press that a vaccine will soon be invented and no "lockdown" will be required anymore. However, earlier Trump promised a vaccine by the end of October. Doctors continue to insist that creating a vaccine is a very long process, and even if it is invented in the near future, mass vaccination will not begin until mid-2021. At the moment, more than 200 thousand people have already died in the States from COVID. By next summer, another grim forecast by Dr. Anthony Fauci may come true – 400,000 deaths.

From a technical point of view, the downward trend remains and Monday trading was rather sluggish. Buyers of the British currency are waiting for positive and official information on Brexit, buyers of the US dollar are waiting for the elections and their results. Thus, so far the pound/dollar pair is trading very calmly, but today everything may change. Volatility in the past seven days has been fairly average, and the prospects for a downward movement, although they look more attractive, may be spoiled by the fundamental background. In general, in the coming days, a lot will depend on the fundamental background and on the nature of the news that will come from Britain and the United States. At the same time, macroeconomic statistics will continue to be ignored by market participants.

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The average volatility of the GBP/USD pair is currently 109 points per day. For the pound/dollar pair, this value is "high". On Tuesday, November 3, thus, we expect movement inside the channel, limited by the levels of 1.2789 and 1.3009. A reversal of the Heiken Ashi indicator to the top signals a possible round of corrective movement.

Nearest support levels:

S1 – 1.2878

S2 – 1.2817

S3 – 1.2756

Nearest resistance levels:

R1 – 1.2939

R2 – 1.3000

R3 – 1.3062

Trading recommendations:

The GBP/USD pair resumed its downward movement on the 4-hour timeframe. Thus, today it is recommended to keep open short positions with targets of 1.2817 and 1.2789 until the Heiken Ashi indicator turns up. It is recommended to trade the pair for an increase with targets of 1.3062 and 1.3123 if the price is fixed back above the moving average line.

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

Overview of the EUR/USD pair. November 3. "Plywood elections". More than 90 million Americans have already voted. Skirmishes

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - downward.

Lower linear regression channel: direction - downward.

Moving average (20; smoothed) - downward.

CCI: -105.2729

During the first trading day of the new week, the EUR/USD pair was trading in the rhythm of the last days, continuing its downward movement. And at a certain point, it fell to the lows of September 25, when everyone also thought that a new downward trend had begun to form, after which the price turned up and returned to the side channel, where it spent another month. Thus, a rebound from the support area of 1.1612-1.1620 is not excluded. To be honest, the downward movement of the last few days looks even a little strange, since it indicates the strengthening of the US currency. And why would the US currency show growth in the run-up to the presidential election, if before that, three months ago, the pair was trading in a side channel? Of course, the current fall of the pair can not be called strong. This may be a "duty" drop in quotes. Or maybe it has nothing to do with the US election at all.

We remind you that the second "wave" of the "coronavirus" is currently raging in Europe, which began relatively recently. "Regarding" the American "wave", which can not be called the "second" one, since the first one did not end. However, France, Germany, and the UK have already imposed "strict" quarantines, other countries will either do so soon or have already taken measures approaching "strict". Anyway, if the epidemiological situation in Europe was relatively calm for several months before the second "wave", then in the last month it is frightening. And, perhaps, the European currency reacted to this factor. After all, the "coronavirus" itself is a medical issue. But "lockdowns" and restrictions imposed by governments are an economic issue. It is the economy that suffers primarily from such measures. The service sector immediately begins to decline, while the industrial sector remains more or less afloat. Thus, the European economy will experience new problems at the end of 2020.

As for almost the most important event of the end of 2020 - the US presidential election - everything is going on as usual, very calmly. The election has already been going on for several weeks since there is such a thing as "early elections" in the States. More than 90 million US residents have already voted, which is equal to 67% of the total turnout in 2016. Most of them are sent by mail. According to media reports, Joe Biden is in the lead, which, in principle, is not surprising, since it was the Democrat who pushed the idea of early voting or voting by mail to avoid queues and mass gatherings on election day. Thus, there was no doubt that the majority of those who voted in recent weeks chose a Democrat. Donald Trump is hoping directly for election day. Also, Trump is counting on winning the election and is even preparing for a certain reshuffle in the state apparatus. Strange as it may seem, the changes may affect first of all those who disagree with the President's opinion on the pandemic. It seems that Anthony Fauci will be the first to be fired, although he has nothing to do with the White House directly. Trump also managed to declare that he is going to declare himself the new President of the United States ahead of schedule, before the full vote count, "if it turns out that he will go ahead of Biden".

Recent opinion polls conducted just a couple of days before the election again showed Biden's advantage over Trump by about 8-10%. However, many experts say that despite Biden's 10% lead over Trump, the current President has a good chance of gaining 270 "electoral votes", which is enough to win. This is because it is difficult to predict results in "contested" states, and in 2016, many also predicted Trump's defeat. Well, in many US cities (especially large ones), quite strange preparations for election day are in full swing. Namely, many banks, companies, restaurants, and hotels board up their facades with plywood sheets, fearing mass riots, and pogroms. Many managers of institutions that have resorted to such drastic measures, reported that during mass rallies and protests related to the death of George Floyd, they have already faced pogroms and vandalism. So this time it's better to be safe. A survey by the well-known YouGov company supports such concerns, which showed that about 56% of Americans expect mass riots and violent protests on November 3. Authorities in some states and cities are also preparing for mass clashes between Trump and Biden supporters. Chicago Mayor Lori Lightfoot said he was "preparing for the worst because of events this spring and summer".

In such conditions, the euro/dollar pair is trading very calmly. At least, its volatility is not out of the average values. So far, the downward trend remains, but no one can predict what will happen tomorrow and until the end of the week. We remind you that the election itself is not something extremely important for traders and investors. What matters is what US policy will be on many vital issues over the next four years. We have already said that under democratic presidents, the US currency usually falls, while under Republicans it rises. Thus, the difference in external and internal policies is of major importance. Also, we should not forget about possible judicial confrontations between Trump and Biden, which may drag on for many weeks, as well as the long counting of votes of those who voted by mail. In general, we can hardly hope that on November 4 we will learn the name of the new President of America. Most likely, this process will take several days or even a week. All this time, market participants will continue to be in limbo. We also warn traders that tomorrow there may be significant exchange rate fluctuations, as it was on election day in 2016, for example. Thus, trading the pair now needs to be extremely careful.

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The volatility of the euro/dollar currency pair as of November 3 is 67 points and is characterized as "average". Thus, we expect the pair to move today between the levels of 1.1560 and 1.1694. A reversal of the Heiken Ashi indicator to the top may signal a new round of upward correction.

Nearest support levels:

S1 – 1.1597

Nearest resistance levels:

R1 – 1.1658

R2 – 1.1719

R3 – 1.1780

Trading recommendations:

The EUR/USD pair continues its downward movement. Thus, today it is recommended to maintain open sell orders with targets of 1.1597 and 1.1560 as long as the Heiken Ashi indicator is directed down. It is recommended to consider buy orders if the pair is fixed above the moving average line with the first targets of 1.1780 and 1.1841.

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

The Federal Reserve may announce measures now rather than December

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The focus in recent times has been on the US election, Monday being the last day of the presidential race. The chances of either candidate winning seem equal which makes investors nervous and the uncertainty in the market increases. The volatility index is far from its usual range and is not even in the area of the levels that we have seen in recent months (20-25). The indicator went above 30-35, which once again indicates market instability.

In general, Trump's victory, as well as Biden's, will equally be positive for the US stock market. If the leadership remains with the current President, it will mean maintaining trade policy with the Federal Reserve's aggressive stimulus policy. The Biden presidency is a new injection of money into the economy. The Democrat is also likely to change the tone of trade relations.

Both factors, in turn, will contribute to the decline of the Dollar, which still retains its position in the market mainly due to the status of a protective asset. As soon as the election situation clears up and none of the candidates contest the results, Dollar sales are likely to increase.

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It is worth noting that immediately after the election, the Federal Reserve will hold a meeting on monetary policy. There has been growing talk that the regulator may take action as early as this week, without waiting for the December meeting. The reason is the deterioration of the epidemiological situation and the lack of new budget incentives. Congress cannot seem to come to an agreement on any stimulus package and companies in major American cities are boarded up because of a possible wave of protests over the election results. Recall that due to the election, the Central Bank postponed the scheduled meeting for Wednesday-Thursday.

Meanwhile, Jerome Powell and other senior officials of the US regulator are calling on the US government to increase budget spending. This will help Americans cope with the consequences of the pandemic. The first release on GDP for the third quarter showed growth of a record 33% but economists still fear for the economic recovery in the future. Due to the growing number of infected people in the country, many states are tightening their social distancing policies, and federal incentives have mostly been stopped.

On Friday, the Federal Reserve lowered the minimum loan amount under the real sector lending program to $ 100,000 from $ 250. In addition, conditions were simplified for small and medium-sized companies applying for a loan. Companies, however, did not rush to get loans.

The regulator may have to increase the pace of asset repurchases from the current $120 billion a month or make other adjustments. This will be a signal that the Central Bank is ready to lend a shoulder to the markets. Meanwhile, officials do not believe that an increase in the volume of incentives will have a tangible effect.

The FOMC may also announce a move to buy back longer-term securities. Thus, financial officials will show that this is real quantitative easing and not just a way to maintain the level of liquidity.

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

Trading idea for gold

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Trading idea for gold.

Gold prices have declined significantly over the past two trading days, breaking through the technical trend line of support. I propose to consider the scenario for the continued fall of gold before the US elections according to the following scheme:

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As a matter of fact, we have a three-wave structure ABC, where the wave A is the initiative of Wednesday and Thursday. Now, we have a pullback wave "B," which has reached 50% Fibo from the short impulse. It is recommended to work on the downside in order to update the September minimum at the 1848 quote.

The short-term scenario will be relevant until the breakdown of 1910. The probability is 2 to 1.

This trading idea is presented in the framework of the "Price Action" and "Stop Hunting" methods.

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