EURUSD Trading plan for November 12, 2020. COVID-19 is at its highs. US news

analytics5facdef023f1a.jpg

COVID-19 is at its highs all over the world. For the second time, + 600K new cases per day are higher globally. In the US, the record is + 142K new cases. In Europe, there is no decline - it has only become better in France, while the group of European countries above + 19K per day, including Russia, is tightly moving.

analytics5face06521a3a.jpg

US market: the powerful surge following Biden's election has run out of steam - there is no reason for strong growth right now. With the new growth, you can carefully sell.

analytics5face0c924d1b.jpg

EURUSD - important data on US employment will be at 13:30 UTC, and this may swing the market.

We are currently on sale from 1.1775 - but we are ready to turn over to buy from 1.1790.

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

Technical Analysis of EUR/USD for November 12, 2020

Technical Market Outlook:

The EUR/USD pair has been seen continuing the wave down that has recently hit the 50% Fibonacci retracement of the last wave up located at the level of 1.1761. Moreover, the market keeps trading below the orange trend line, so the bearish pressure is stronger. The next target for bears is seen at the level of 61% Fibonacci retracement seen at 1.1732. The nearest technical resistance is located at 1.1789 and will act as a intraday level. The weak and negative momentum supports the short-term bearish outlook.

Weekly Pivot Points:

WR3 - 1.2308

WR2 - 1.2092

WR1 - 1.2015

Weekly Pivot - 1.1812

WS1 - 1.1717

WS2 - 1.1522

WS3 - 1.1441

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.

analytics5face02515657.jpg

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

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

analytics5facdf11e3e45.jpg

GBP/JPY is currently a minor correction that most likely will lead to support in the 138.16 - 138.30 area for the next impulsive rally higher to the former peak at 142.72 and ultimately a break above here is expected too.

If, however, support at 138.16 is broken, we see back-up support at 137.69 that should halt the correction from 140.32 and turn prices higher again through minor resistance at 139.43 for the rally higher towards 142.72.

R3: 139.72

R2: 139.47

R1: 139.02

Pivot: 138.97

S1: 138.55

S2: 138.30

S3: 138.16

Trading recommendation:

We are long GBP from 135.45 with our stop placed at 137.45

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

Technical Analysis of GBP/USD for November 12, 2020

Technical Market Outlook:

After the GBP/USD pair has extended the rally towards the level of 1.3273, which is a 127% Fibonacci extension of the last wave up, the rally was capped, because a Pin Bar and then a Shooting Star candlestick were made at its top. Moreover, the market has hit the technical resistance located at the level of 1.3282, so some kind of pull-back should be expected. Currently, the price is testing the nearest technical support at the level of 1.3182. The next technical support is seen at the level of 1.3169 and 1.3121. Please notice, the market is coming off the overbought conditions, which supports the short-term bearish outlook.

Weekly Pivot Points:

WR3 - 1.3631

WR2 - 1.3400

WR1 - 1.3312

Weekly Pivot - 1.3083

WS1 - 1.2991

WS2 - 1.2762

WS3 - 1.2666

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.

analytics5facdeb5b6a99.jpg

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

EUR/USD: US dollar will continue to strengthen

Risky assets remain under pressure due to the COVID-19, since all the rumors that are now taking place around the coronavirus vaccine are more likely on the side of medium-term investors, but does not affect the short-term market, which interests it during the start of the week and then forgot about it.

analytics5facda52706d8.jpg

Yesterday, we focused our attention on the speech of the ECB's head, Christie Lagarde, which could have supported the euro, but investors ignored Lagarde's statement for some unknown reasons – either they do not strongly believe in the policies of the European Central Bank, or the current coronavirus pandemic forces them to adhere to a more conservative strategy. In any case, Lagarde's statements were ignored, and this raises a lot of questions, since it is not entirely clear how the market will now react to the results of the December meeting of the European regulator.

She also reiterated that the main tools to support the European economy are the PEPP and TLTRO programs. Speaking at the annual ECB forum, which is directly dedicated to monetary policy, Lagarde noted that the existing PEPP and TLTRO programs have already proved their effectiveness in the current conditions and there is no point in talking about introducing new changes yet. At the same time, she also pointed to the possibility of correcting these programs in the direction of expansion and increase, if necessary. However, no one has doubted this direction for a long time, especially given the current situation with the COVID-19 in the Eurozone countries. It is another matter whether the ECB will resort to negative interest rates, which Lagarde spoke about so often in the early autumn of this year.

After instructing European banks to provide their views and reports on how a negative key interest rate would affect their profitability, Christine Lagarde's statements on this topic was practically forgotten. Does this mean that the ECB is clearly dissatisfied with the reports and the information that has been received, which makes them doubt the right choice of strategy for the next year?

It was pointed out in recent reviews that after the news of the third successful trial of the COVID-19 vaccine, the ECB may take advantage of this by adjusting its statements. The result happened quickly. Yesterday, Christine Lagarde said that the news of a possible vaccine seemed encouraging, but added that the economy was still facing an increase in virus infections and tightening of restrictive measures. There was also news yesterday that even before the release of the COVID-19 vaccine produced by Pfizer and BioNTech, the European Commission concluded deals to supply 300 million doses to the countries of the eurozone, while Great Britain will buy another 40 million.

analytics5facda9e24f98.jpg

It was noted above that the market did not react much to this news, which, on the other hand, plays into the hands of the ECB, which fears a higher euro exchange rate more than negative interest rates.

Another point that could put pressure on the US dollar was yesterday's news that the Democrats, although they won a majority in the House of Representatives, turned out to be much less than expected. The Democrats failed to win the Senate. As a result of the election, the Republicans successfully defended their seats, gaining 49 seats against 48 for the Democrats. The second round of elections to both houses of Congress will be held in January this year.

Technically, the further direction of the EUR/USD pair depends on the support level at 1.1745, which buyers managed to protect during the first wave of testing. It is possible that the weak fundamental statistics, which is expected today on the eurozone economy, will increase the pressure on the euro. Now, if the level of 1,1745 breaks down, it will lead to a new wave of sell-off of risky assets with an exit to the base of the 17th figure and an update to the low of 1.1655. It will be possible for the euro to continue to rise after consolidating above the resistance located at 1.1800, which will lead to upward correction in the area of 1.1860. A further goal will be the weekly resistance located at 1.1915.

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

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

analytics5facddb09c9b6.jpg

EUR/JPY is expected to hit the corrective target at 123.56 before moving higher again towards the next upside target at 127.02 and likely closer to 129.38. In the short-term, a break above minor resistance at 124.29 will confirm that the ongoing correction from 125.13 has completed and the next impulsive rally is unfolding towards 127.02.

It will take an unexpected break below support at 123.25 to question the rally from 121.59 and indicate something much more complex is unfolding.

R3: 125.72

R2: 125.00

R1: 124.65

Pivot: 124.13

S1: 123.95

S2: 123.44

S3: 123.23

Trading recommendation:

We are long EUR from 122.25 with our stop placed at 123.25

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

Technical Analysis of BTC/USD for November 12, 2020

Crypto Industry Outlook:

Bitcoin's hash rate has increased by around 30% in the last 24 hours, which, if maintained, suggests that there may be a major correction of difficulties soon. According to Coinwarz, the Bitcoin hash rate is now 157.5 Exahashes per second (EX / s) after a brief spike above 160 EH / s. At the time of the press release, the BTC hash rate increased by 42% in two days.

The jump follows a sharp drop in computing power at the end of October, which many analysts attribute to the end of the rainy season at the Chinese Sichuan mining center. It is estimated that the abundant and cheap hydropower in the province attracts around 80% of Chinese miners during the rainy season. In December, CoinShares estimated that Sichuan was responsible for 54% of global mining activity. The sudden increase in BTC computing power could mean that many Chinese miners have finished their migration from Sichuan and resumed operations in other local mining centers such as Xinjian and Inner Mongolia.

Technical Market Outlook:

The BTC/USD pair keeps pushing upward and in the result bulls are getting closer to the level of $16,000. From time to time the market is consolidating the recent gains in extremely overbought market conditions and then makes another spike up. There is a potential Bullish Flag price pattern in progress on the H4 time frame chart. The intraday technical support is currently seen at the level of $15,215 and the intraday technical resistance is located at $15,526. The up trend is still being continued, so the next target for bulls is seen at the level of $16,000.

Weekly Pivot Points:

WR3 - $19,307

WR2 - $17,576

WR1 - $16,627

Weekly Pivot - $14,868

WS1 - $13,889

WS2 - $12,207

WS3 - $11,247

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 $16,000, 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.

analytics5facddaa87be9.jpg

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

Technical Analysis of ETH/USD for November 12, 2020

Crypto Industry Outlook:

The KuCoin cryptocurrency exchange recovered most of its funds from the $ 280 million lost in September in a hacking incident.

Johnny Lyu, KuCoin's co-founder and CEO, announced on November 11 that the stock market had recovered 84% of the stolen assets. Lyu said the recovery process included "chain tracking, updating contracts, and judicial collection." He also noted that the exchange will publish more details on the refund after the case is closed.

According to Lyu, KuCoin has resumed full service for 176 trading tokens on its platform. He said the services for the remaining coins are due to reopen before November 22nd. KuCoin has a total of 230 tradable assets on its platform.

When posting the news on Twitter, Lyu did not provide the exact amount of assets lost as a result of the hacking incident. KuCoin initially estimated user losses at $ 150 million, while crypto analytics company Chainalysis estimated losses at $ 275 million.

Lyu previously said the breach had an impact on hot wallets that contain Bitcoin, Ether, and ERC-20 tokens. A large number of stolen ERC-20 tokens were then frozen by major crypto projects to prevent withdrawals. In early October, Lyu announced that KuCoin executives had managed to find burglary suspects with "substantial evidence".

Technical Market Outlook:

The ETH/USD pair has hit the level of $475.58 after the triangle breakout, so the bullish pressure is still present. Nevertheless, the price got back to the old supply zone quickly and now is consolidating inside of this zone. The level of $424.65 will now provide the intraday support and the level of $400 will now act as a key technical support. The next target for bulls is seen at the swing high at $466.36 and then $500. Only if a daily candle closes below $360 level, then the bears will have full control of the market.

Weekly Pivot Points:

WR3 - $594.51

WR2 - $529.18

WR1 - $494.37

Weekly Pivot - $431.37

WS1 - $395.52

WS2 - $336.56

WS3 - $301.67

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.

analytics5facdc22dcc94.jpg

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

GBP/USD: plan for the European session on November 12. COT reports. Pound started a correction, but GDP data may bring back

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

The British pound emerged from an excellent side yesterday, allowing both buyers and sellers to earn money. There was a great long entry point in the morning, which I discussed in detail in yesterday's review. The bears' unsuccessful sluggish attempt to regain the market below 1.3261 led to another false breakout, which only confirmed the preservation of the bull market at the beginning of the European session. The large rally towards the 1.3315 high was not surprising, afterwards the bulls began to take profit. The currency was under pressure in the afternoon. I advised you to open short positions only when the pair has settled below support at 1.3242, which is what happened. On the chart, you can see the bears going below 1.2342 and then testing that same level from the bottom up, forming an excellent entry point for short positions that generated over 60 points of profit.

analytics5facdbda91f2b.jpg

Buyers should return resistance at 1.3248, since the pair's long term direction depends on this level. However, this can only be done in case we receive good data on the UK economy for the third quarter. A breakout and settling above 1.3248 as well as testing this level from top to bottom produces an excellent entry point into long positions, which will open a direct road to the weekly high of 1.3310. Bank of England Governor Andrew Bailey could provide support to the pound, which will lead to a breakdown of 1.3310 and growth to a high of 1.3378, where I recommend taking profit. In case GBP/USD falls in the first half of the day after receiving weak data, it is best not to rush into long deals, but instead you should wait for a false breakout to form in the support area of 1.3172. Lack of bullish activity in this range could pull down the pound. Therefore, I recommend opening long positions immediately on a rebound from support at 1.3094, counting on a correction of 30-40 points within the day.

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

Pound sellers will aim to protect resistance at 1.3248, which may be tested today after the release of a number of fundamental data on the UK economy. If they manage to form a false breakout at this level, this will be another signal to open short positions further along the trend. A breakout and settling below support at 1.3172 is also an important task for maintaining the downward momentum. This will increase the pressure on the pair and pull down GBP/USD to a low of 1.3094, where I recommend taking profits. Do not rush to open short positions in case bears are not active at the 1.3248 level. It is best to wait until the weekly high of 1.3310 has been updated and a false breakout is formed there, or to sell GBP/USD immediately on a rebound from resistance at 1.3378, counting on a correction of 30-40 points within the day.

analytics5facdbde0a132.jpg

The Commitment of Traders (COT) report for November 3 showed a reduction in long positions and a slight increase in short ones. Long non-commercial positions fell from 31,799 to 27,701. At the same time, short non-profit positions only rose to 38,928, from 38,459. As a result, the negative non-commercial net position was 11,227, against 6,660 a week earlier, which indicates that sellers of the British pound remain in control and have a minimal advantage in the current situation.

Indicator signals:

Moving averages

Trading is carried out just below the 30 and 50 moving averages, which indicates the likelihood of the continued downward correction.

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 daily D1 chart.

Bollinger Bands

The breakout of the upper border in the 1.3254 area will lead to a new wave of growth for the pound. A break of the lower border of the indicator around 1.3172 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) Quick EMA period 12. Slow EMA period to 26. SMA period 9
  • Bollinger Bands (Bollinger Bands). Period 20
  • Non-commercial speculative traders, 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.
  • 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/USD: plan for the European session on November 12. COT reports. Bears achieved their goals, pair's direction depends

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

Selling the euro below the 1.1797 level, which I mentioned in yesterday's morning forecast, brought a good result, since the bears managed to get to the next target level of 1.1743 in the US session. If you look at the 5-minute chart and remember yesterday's forecast, you will see that a good signal to sell the euro appeared after forming a breakout and getting the pair to settle below the 1.1797 level, followed by its test from the bottom up, which then pulled down the pair to a low of 1.1743. By the way, I advised you to open long positions immediately on a rebound from this level in the afternoon, which also made it possible to take additional 20-30 points of profit from the market.

analytics5facdba343207.jpg

Buyers of the euro will most likely focus on protecting support at 1.1743 in the morning, which they defended in yesterday's US session. However, I recommend opening long positions from it only when a false breakout is formed there and also when yesterday's low has been updated, which will be confirmed by the divergence on the MACD indicator that is gradually emerging. In case bulls are not active amid weak data, and today we have quite interesting reports on German inflation and the volume of industrial production in the eurozone, I recommend completely postponing long positions until the low of 1.1701 has been tested, where you can buy the euro immediately on a rebound. An equally important task for the bulls is to return the 1.1797 level, the area which is where the moving averages are now playing on the side of sellers. Going beyond and testing this level from top to bottom produces a convenient entry point to long positions with the goal of restoring the euro's growth, which will lead to resistance at 1.1860. The next goal will be a high of 1.1915, where I recommend taking profits.

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

The sellers' initial task is to protect resistance at 1.1797, which they managed to win back yesterday afternoon and from which they built a rather large downward trend. As long as trading is carried out below this range, we can expect the downward trend to continue. An unsuccessful attempt to rise above 1.1797 after we receive data on the eurozone economy also forms an additional signal to open short positions in EUR/USD. In this case, the nearest target will be a low of 1.1743. Going beyond this area will increase pressure on the pair and quickly pull it down to a low of 1.1701, where I recommend taking profits. If the bulls turn out to be stronger and they manage to bring back the 1.1797 area in the first half of the day, then it is best not to rush to sell, but to postpone new short positions until the resistance of 1.1860 has been renewed. I also recommend selling EUR/USD immediately on a rebound from a high of 1.1915, counting on a correction of 15-20 points within the day.

analytics5facdba68b618.jpg

The Commitment of Traders (COT) report for November 3 recorded a reduction in long positions and an increase in short positions. Despite this, buyers of risky assets believe in the continuation of the bull market, although they prefer to proceed with caution. Thus, long non-commercial positions fell from 217,443 to 208,237, while short non-commercial positions rose from 61,888 to 67,888. The total non-commercial net position fell to 140,349, from 155,555 a week earlier. However, the bullish sentiment on the euro remains rather high in the medium term, especially after the victory of Joe Biden, who intends to endow the US economy with the next largest monetary aid package worth more than $2 trillion.

Indicator signals:

Moving averages

Trading is carried out below 30 and 50 moving averages, which indicates the likelihood of further downward correction of the euro.

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 daily D1 chart.

Bollinger Bands

A breakout of the upper border of the indicator around 1.1797 will lead to a new wave of euro growth. A break of the lower border at 1.1755 will increase pressure on the euro.

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) Quick EMA period 12. Slow EMA period to 26. SMA period 9
  • Bollinger Bands (Bollinger Bands). Period 20
  • Non-commercial speculative traders, 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.
  • 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

Trading plan for EURUSD for November 12, 2020

analytics5facbf8a53b0e.jpg

Technical outlook:

EURUSD might have carved a lower high around the 1.1920 level last week before turning lower. EUR/USD is seen to be trading around the 1.1770 level at this point in writing after dropping to a 1.1745 low yesterday. The pair could produce an intraday rally toward the 1.1850/60 levels in the immediate future but prices should remain well capped below 1.1920 highs. Also note that EURUSD had rallied up to the Fibonacci 0.50 levels of earlier drop between 1.2010 and 1.1600/10 respectively. It the above structure remains intact, bears may push prices below 1.1600 in the next few trading sessions. Immediate resistance is seen at 1.1920, while intermediary support comes around the 1.1600 level respectively. A drop below 1.1600 will confirm that bears are back in control.

Trading plan:

Remain short, stop @ 1.2010, target below 1.1500

Good luck!

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

EUR/USD, Under bearish pressure targeting 61.8% fibonacci. Analysis For November 12, 2020

The EUR/USD continued its decline to 1.1744 to stabilize in the area of the 200 EMA as the downward pressure eased due to a US holiday and an empty macroeconomic calendar.

The number of new infected cases of coronavirus in the United States and Europe shows a clear upward trend. The US reported a record of more than 130,000 new infections in one day, while Italy announced new restrictive measures to curb the infection.

Today, Thursday in a few hours, Germany will publish the final version of its inflation for October, while the EU will publish the figures for industrial production for September.

analytics5facb6b54a85f.jpg

The euro in 4-hour charts is trading around the 50% Fibonacci retracement, drawn from its low of 1.1601 and its high of 1.1918, this technical outlook shows that there is strong downward pressure in the short term, supported by the indicator of Eagle.

Our recommendation is sell below 1.1750, with targets at 1.1715 and 1.1685, stop loss above 1.1803.

analytics5facb6d446dd7.jpg

The 1 hour chart is under a channel with a bearish trend, with a possible rebound from the top of the 200-day average, with targets at 2/8 of the Murray line. The data that will be published today is better than expected will be able to support the euro.

Our recommendation is buy if rebound 1.1742, with targets at 1.1810 and 1.1840, stop loss at 1.1715.

The 61.8% retracement of the 4-hour chart reaches 1.1718, providing immediate strong support.

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

Trading plan for EUR/USD and GBP/USD on 11/12/2020

Yesterday, the euro and the pound initially showed good growth, but they had to give up all their gains in the end. At first glance, it may seem that it's all about yesterday's speech by Christine Lagarde. After all, it was assumed that against the background of reports about the appearance of a coronavirus vaccine, the European Central Bank might hint at the possibility of reducing the stimulus measures introduced just because of the global pandemic that hit Europe very hard. However, the speech of the head of the European Central Bank has nothing to do with this. After all, not only the single European currency was declining, but also the pound. And nor did Christine Lagarde say address the issue at all. Therefore, we can assume that the things that happened yesterday is because of something else.

Apparently, it's all about the rumors that began to spread in the American media. There are more and more reports that Mr. Trump may abandon further struggle for the presidency and even withdraw lawsuits filed due to massive violations and falsifications during the voting itself and the subsequent vote count. This assumption is due to the fact that even if Donald Trump manages to achieve a recount of ballots in a number of states, he will not be able to do it in key states. As a result, he will still not get enough electoral votes. In other words, fighting his position will be meaningless. Although, according to rumors, the current president still does not recognize the past elections as fair. However, if these rumors are even slightly close to the truth, it is a factor that reduces uncertainty, and therefore has a positive impact. Most likely, this is what allowed the dollar to recoup its losses.

analytics5facd1328547d.jpg

It is time for investors to turn their attention to macroeconomics due to the fact that the conflict regarding the US election is already ending. Fortunately, today's statistics are all right and there will be quite a few of them. The first to report will be the UK, where the pace of economic decline is expected to slow down from -21.5% to -9.7%. This is a fairly significant improvement in GDP dynamics, but only for the preliminary data. At the same time, certain improvement is expected in the industry, whose rate of decline may slow down from -6.4% to -6.2%. Against this background, the forecasts are entirely positive and quite impressive, although we are still talking about a recession. Nevertheless, even a hint of improvement is now being received with great optimism.

Industrial production (UK):

analytics5facd13981eab.jpg

Industry in the euro area should also show improvement, where the rate of its decline may slow down from -7.2% to -5.4%. All this should lead to the fact that the euro will slightly grow with the pound.

Industrial production (Europe):

analytics5facd13f8f88c.jpg

However, the euro's growth will be temporary. We may witness not just a return, but also a subsequent strengthening of the dollar after the opening of the US session. Of course, it's all about inflation growth, which is expected to rise from 1.4% to 1.5%. This is a favorable factor. However, we are talking about the fact that inflation has been growing for five consecutive months, given that the forecasts are confirmed. In other words, US inflation is growing steadily, which means that the Fed does not need to think about any additional stimulus measures. Rather, on the contrary, it's time to think about reducing them. That is, about tightening the parameters of monetary policy.

In addition, the dollar will be supported by data on applications for unemployment benefits, which may continue to decline. In particular, the number of initial applications should be reduced from 751 thousand to 743 thousand. But this is not much, so repeated applications are greatly interesting, which is expected to decline from 7,285 thousand to 6,820 thousand. As a result, US inflation is expected to continue to rise and unemployment is expected to decline.

Repetitive Unemployment Insurance Claims (United States):

analytics5facd14660ca9.jpg

The EUR/USD pair has been consistently forming a downward movement since this trading week started, as a result of which the quote declined to the level of 1.1750, where a stop occurred with a subsequent pullback. We can assume that there will be another decline which will lead to the values 1.1700 - 1.1650 --- 1.1620, if the price consolidates below 1.1745.

analytics5facd15434a1d.jpg

The GBP/USD pair found a resistance around the level of 1.3300, where there was a stop, followed by a corrective move. We can assume that a price consolidation below the level of 1.3190 will lead to a decline towards 1.3140-1.3100. It should be noted that as long as the quote does not consolidate below 1.3190 on an H4 TF, a variable gap in the amplitude 1.3190/1.3240 is possible.

analytics5facd15a07e76.jpg

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

Indicator analysis. Daily review for the EUR / USD currency pair 12/11/2020.

Trend analysis (Fig. 1).

Today, the market from the level of 1.1776 (the closing of yesterday's daily candle) can start moving up with the goal of 1.1814 which is a pullback level of 76.4% (blue dotted line). When testing this level, further work up with the goal of 1.1858 which is the resistance line (white bold line).

analytics5facd6a0672b8.jpg

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 – down

General conclusion:

Today, the market from the level of 1.1776 (the closing of yesterday's daily candle) can start moving up with the goal of 1.1814 which is a pullback level of 76.4% (blue dotted line). When testing this level, further work up with the goal of 1.1858 which is the resistance line (white bold line).

Alternative scenario: From the level of 1.1781, which is a pullback level of 61.8% (blue dotted line), the price can continue to move down with the goal of 1.1761 which is a pullback level of 50.0% (red dotted line). When testing this level, further work down with the goal of 1.1723 which is a rollback level of 61.8% (red dotted line).

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

Indicator analysis. Daily review on the GBP/USD currency pair for November 12, 2020

Trend analysis (Fig. 1).

Today, the market from the level of 1.3223 (closing of yesterday's daily candlestick) can continue to work down with the goal of 1.3163 – a pullback level of 23.6% (red dotted line). After testing this line, continue working down with the target of 1.3070 - a pullback level of 38.2% (red dotted line). Upon reaching this level, upward work is possible.

analytics5facaaaf7c339.jpg

Figure 1 (Daily Chart).

Comprehensive analysis:

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

General conclusion:

Today, the price from the level of 1.3223 (closing of yesterday's daily candlestick) can continue to work downward with the goal of 1.3163 – a pullback level of 23.6% (red dotted line). After testing this line, continue working down with the target of 1.3070 - a pullback level of 38.2% (red dotted line).

Alternative scenario: when moving down and reaching the pullback level of 23.6% - 1.3163 (red dotted line), the market will try to move up with the goal of 1.3251 – the historical resistance level (blue dotted line).

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

AUD/USD forecast for November 12, 2020

AUD/USD

Yesterday, the Australian dollar closed the day with a significant decline but the price held above the Kruzenshtern line on the daily scale chart. This morning, there is a second attempt of the price to work out the upper limit of the price channel of the higher scale (0.7328). Fixing above it will allow the price to develop an offensive to the September maximum at 0.7415.

atqovTu0BRSWEea4ASIzyf7pzmC_R5edHIaA51WD

But this plan has a weak point. The signal line of the Marlin oscillator is decreasing. The nature of the decline is similar to the period of September 9-18, when the Marlin moved horizontally (gray oval) and the price slowly moved up. After this, there was a powerful collapse of the market.

BS2Q5ntul-dJE5jN_rlqbS1E4dztD_BRITE0JtJP

On the four-hour chart, the price continues to hold above the balance and Kruzenshtern indicator lines, which maintains the general growth trend. But the Marlin is already in the negative zone which slightly increases the probability of a price decline in the range of 0.7195-0.7222 determined by the Kruzenshtern line. Moving the price under this range opens the first bearish target of 0.7120.

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

Forecast for EUR/USD on November 12, 2020

EUR/USD

The euro lost 37 points on Wednesday, the target level of 1.1750 was reached. Now the price is faced with the task of getting the pair to settle below this level, if the pair really intends to succeedingly move down.

TQv3J9-J4XspaBWe85BmV9glDWH3Nnuj9KUSdglU

In case the pair settles above the recent support at 1.1830, there may be a new short-term rush to buy while aiming for 1.1905 to the MACD line on the daily chart, or slightly higher, to 1.1945 - to the upper border of the price channel. This scenario is very likely, since the signal line of the Marlin oscillator shows that an upward reversal will start while still being in the positive area, which is a growth trend.

8dQI0ouSPqOvKtYTLBAUUIwBTdER07o0dx37QyCy

The price reflected from the MACD indicator line on the four-hour chart. Getting the pair to settle below it will confirm the downward movement, as the signal coincides with the daily timeframe chart - the Marlin oscillator will go into the negative area on both charts. The target will be the 1.1620 level. We are waiting for the development of events.

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

EUR/USD. The Euro's growth difficulties; the Dollar believes that even in a world free of a pandemic, it will find room

analytics5facb20f4ad3f.jpg

Statements by Pfizer and its partner Biotech about the effectiveness of the Coronavirus vaccine they developed roiled markets but did not lead to an increase in risky assets across the spectrum. In particular, the Euro's reaction to the news about the vaccine was rather sluggish.

Investors briefly imagined a world free of the worst pandemic of the last hundred years but quickly realized that it would take a long time to vaccinate the entire population of the planet so the victory over the virus is still not so close.

This allowed the defensive greenback to recover and move away from two-month lows.

The nearest strong resistance for the USD is located at 93.10 points and then at 93.60 and 93.95.

Recent lows in the area of 92.10–92.15 should contain attempts to decline.

Meanwhile, the Euro is once again facing a harsh reality. COVID-19 continues to negatively affect Europe. Vaccination of the population will most likely begin no earlier than 2021. The fourth quarter of this year promises to be a terrible one for the Euro, and investors seem to be preparing for such a development.

Data released yesterday showed that the Zew Institute's business confidence index for the Euro zone economy fell to 32.8 points in November from 52.3 points recorded a month earlier.

The collapse of the indicator turned out to be sharper than experts expected, and reflects fears of a new wave of recession in the region.

"The day before, the EUR/USD pair looked under the strong support of 1.1780 but quickly recovered and ended the day near 1.1814. The attack on strong support indicates that the pair is not ready to move to the current year's maximum at 1.2011. To do this, it must first close above 1.1915. The chances of further strengthening of the Euro have decreased. We allow the EUR to weaken to $1.1720, " UOB experts said.

According to Danske Bank, the Euro may experience difficulties in trying to beat the Dollar, even if the global economic Outlook improves due to the development of a promising coronavirus vaccine.

"The main currency pair reacted modestly to the promising results of tests of the COVID-19 vaccine developed by Pfizer and BioNTech. This means that it is not at all obvious that the Euro can break above $1.20 with any recovery in global optimism, " they said.

In recent months, risk assets have grown mainly due to continuous QE and near-zero interest rates.

"The introduction of the COVID-19 vaccine means less incentive (especially "free money") and less confidence that central banks' support for risky assets will be strong enough. Previously, it was assumed that due to the impending political impasse in the US, the Federal Reserve will be ready to provide unlimited support and liquidity. However, the sharp rise in yields at the long end of the treasuries curve and the impact of reduced stimulus when the coronavirus restrictions are lifted means that next year's stimulus may be very much reduced. How ironic: good news turns out to be bad for the market, " Saxo Bank said.

"I don't see an opportunity for a long-term bear market for the US Dollar," said brad Bechtel, strategist at Jefferies.

The United States, like the EU, has faced new outbreaks of COVID-19 but is unlikely to impose a nationwide quarantine and will be limited to local measures. Optimism about the prospects for the rapid development of an effective Coronavirus vaccine will only increase the reluctance of the US authorities to limit economic activity in the country.

"If the situation in the US economy becomes really good again, then the smile theory of the Dollar will work and the greenback will strengthen, " B. Bechtel believes.

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

Forecast for USD/JPY on November 12, 2020

USD/JPY

On the daily chart for the third day, the Japanese yen is held above the MACD line. The Marlin oscillator is developing in a small horizontal range, increasing the probability of price growth to the nearest target of 106.03 along the price channel line.

analytics5faca43cf3a8c.jpg

But this plan has an alternative, which manifests itself when considering the situation on a four-hour scale. Yesterday, the price went up from the triangle, then returned to its top, converting the triangle into a flag.

analytics5faca451ee117.jpg

Meanwhile, a divergence was formed based on Marlin. Since the price is close to going under the forming lines of the flag and triangle, working out the target level of 104.75 is possible. By this time, the Marlin oscillator on the daily timeframe may be in the zone of negative values. Fixing the price at 104.75 will open the target of 104.05 at the minimum on September 21. If the price is fixed at 104.75, the MACD line on H4 can be easily overcome by increasing dynamics. The probability of both upward and downward development is the same, and the uncertainty can be resolved today.

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

EURUSD - hope for the best, but prepare for the worst

A vaccine against COVID-19 has been found, but you should not relax.

Recently, pharmaceutical giants Pfizer and Biotech announced that the testing of the COVID vaccine is coming to an end and there are positive results. Markets were flooded with emotions, stock, and commodity exchanges were flooded with positive dynamics, while Pfizer's management, according to rumors, partially dumped shares. Uncertainty in research or Pfizer's strategic move and time will tell whether it will turn to risks.

Everyone is well aware that from the moment the COVID vaccine appears to the victory over the virus, the path is thorny. From the semi-annual report of the Federal Reserve System (FRS) published yesterday, it is clear that the regulator is considering different scenarios, including a market collapse.

Of the main risks, the Federal Reserve notes that if the Coronavirus pandemic drags on longer than predicted, then the economic recovery may be undermined, as a result, financial institutions will receive a new blow, which will negatively affect the markets. Part of this is about forced business closures for quarantine and unpaid vacations.

On the territory of the European Union, where a seven-year budget of 1.8 trillion Euros was agreed yesterday, things are no better.

France and Italy have recorded the highest daily death rates from COVID since April, and the Paris region is close to running out of intensive care beds.

In Germany, the number of patients with Coronavirus in intensive care units has reached a new record. The workload of the department is just over 70% of beds, including patients without COVID. Meanwhile, preparations for vaccine distribution are increasing worldwide, as Pfizer and Biotech injections require sophisticated deep-freeze infrastructure. Thus, you should not wait for the first vaccines until next year.

In turn, the European Central Bank (ECB) signals a possible collapse of European companies, despite government support. So, from the ECB report, it follows that one in seven employees of Spanish companies is on the verge of dismissal.

"Whether the current crisis will cause long-term damage will depend, among other things, on the number and nature of companies that will collapse as a result of the lack of liquidity caused by lockdowns and restrictive measures," the ECB report said

The material shows that the appearance of the vaccine is good news, but do not expect rapid changes. The markets, as before, are at high risk of a new collapse.

In terms of technical analysis, you can see that the echoes of speculation continue to appear in the market. A good example is the first half of the previous day, where a sharp strengthening of the US Dollar against the Euro occurred during the period 10: 45-12: 45* (time at the trading terminal*). As a result, the quote overcame the local minimum of November 9 which was 1.1795 and fell to the area of 1.1780 where there was a stop and then a return to the point of inertia. In fact, the market reflected a surge followed by stagnation, echoes of which are observed during the Asian session of the subsequent trading day.

As for the market dynamics for November 10, this is the first slowdown in five trading days of 63 points, which is 20% below the average level. It is worth considering that even with such a significant decrease in daily activity, local dynamics are at a positive level, which is confirmed by a high coefficient of speculative operations, as well as impulse jumps on the trading chart.

Looking at the trading chart in general terms (daily period), you can see the first signals of the upcoming correction move relative to the past week. Candlesticks from November 6 and 9 were used as tools, which reflect the bearish absorption pattern. This signal in the interpretation of candle analysis indicates a possible downward movement in the market, in this case it may be the beginning of a corrective move.

analytics5faca58f4e8e1.jpg

Today, in terms of the economic calendar, we do not have the publication of important statistical indicators. The market will focus on technical analysis, as well as information flow, depending on the category of its importance.

Analyzing the current trading chart, you can see that with the start of the European session, there was a speculative demand for the US Dollar, which led to a breakdown of the local minimum of the previous day of 1.1780 and sellers managed to once again strengthen their positions.

In fact, we have a prolongation of the correction course from the local maximum of 1.1920, where in the future there may be a change of status from a correction to a recovery process relative to the upward inertia course of the past week.

Holding the quote below the price level of 1.1810 strengthens the position of sellers and a sequential descent confirms the expectations of the specified position.

It can be assumed that speculative demand for the US Dollar will continue in the market where it is possible that a consistent update of local lows will eventually lead to a full recovery relative to the upward course of the past week. In other words, the sellers' benchmark is 1.1650 and 1.1600.

An alternative scenario for market development will be considered if the quote returns above the level of 1.1810 where buy positions are placed in the area of 1.1850.

analytics5faca59239075.jpg

Indicator analysis

Analyzing a different sector of timeframes (TF), it is clear that the indicators of technical instruments on the minute and hour intervals are already actively taking a downward position, signaling a sale. The daily interval is on the verge of changing direction from ascending to descending, which is justified due to the recovery process.

analytics5faca59546335.jpg

The volatility for the week / measurement of volatility: Month, Quarter, and Year

The measurement of volatility reflects the average daily fluctuation, calculated for the Month, Quarter, and Year.

(November 11 was based on the time of publication of the article)

The dynamics of the current time is 86 points, which is already 8% higher than the average level. We can assume that the growth of activity may still continue to the borders of 100-120 points.

analytics5faca59833ed3.jpg

Key level

Resistance zones: 1,1810*; 1,1910; 1,2000***; 1,2100*; 1,2450**; 1,2550; 1,2825.

Support areas: 1,1700; 1,1612*;1,1500; 1,1350; 1,1250*;1,1180**; 1,1080; 1,1000***.

* Periodic level

* * Range level

***Psychological level

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

Hot forecast and trading signals for GBP/USD on November 12. COT report. Analysis of Wednesday's deals. Thursday recommendations

GBP/USD 1H

analytics5fac9886c886e.jpg

The GBP/USD pair tried to overcome the resistance level of 1.3266 on Wednesday, November 11, but it eventually failed to do so. Thus, a correction began with the nearest target, the Kijun-sen line, which was successfully worked out by the end of the trading day. And so the upward trend persists, since the price is above the critical line and the trend line. Bears are still rather weak, while bulls continue to dominate the market. The downward correction may even reach the trendline target if the price manages to overcome the Kijun-sen line. And even in this case, the upward trend will remain present. However, take note that the outlook for the pound remains extremely dim. It is even difficult to say what exactly pushed the pound to rise over the past few days, given that, for example, the euro/dollar pair was mainly falling. Yes, the fact that the House of Lords of the British Parliament rejected the Johnson Bill could have provided support to the pound. However, this is rather normal news for the pound, and not a reason to be happy. On the contrary, the pound should have declined on fears of the adoption of this scandalous bill. In general, there are still a lot of questions about strengthening the pound.

GBP/USD 15M

analytics5fac988a0355b.jpg

The lower linear regression channel turned to the downside on the 15-minute timeframe, indicating that a downward correction has started. However, the pair has not overcome the Kijun-sen line and the support area of 1.3160-1.3184. Therefore, further decline is still in question.

COT report

analytics5fac988d4268e.jpg

The GBP/USD pair only lost 100 points during the last reporting week (October 27-November 2). The pound began to rise after November 2. And it wasn't so much of a rise, but more like the dollar's fall. However, let's go back to the reporting period. Non-commercial traders closed 3,281 Buy-contracts (longs) and opened 1,146 Sell-contracts (shorts). Thus, the net position for the "non-commercial" group of traders decreased by 4,500. This is much more clearly visible on the chart of the first indicator. The green and red lines, which represent the net positions of the two most important groups of traders, began to diverge in different directions. Therefore, the mood of professional traders is becoming more bearish again. However, this change did not result in the pound's decline. Because elections were already held in the United States on November 3 and the dollar was only getting cheaper then. Therefore, the new Commitment of Traders (COT) report may show that the bearish mood is weakening among professional traders. However, in any case, we believe that the markets need to calm down and only after that will it be possible to look at all the information in a new way. It is now clear that market participants are in a very agitated state due to the political chaos that is now present in the United States. Therefore, the mood of large traders can change quickly and dramatically.

The fundamental background for the British pound remains sharply negative, while the currency itself continues to grow. This case just clearly shows that it is not statistics or foundation that move pairs in the foreign exchange market, but the traders. Even if the news speaks about one thing, it does not mean that traders will always act according to them. For example, the House of Lords did not vote "for" a bill that violates the agreement with the European Union on Brexit. Is this news good or bad? Good, but, on the other hand, it should not have existed at all if Prime Minister Boris Johnson had not initiated this bill, because of which the pound should have become cheaper and cheaper in due time. And so it turns out that Johnson did poorly at first, and now the House of Lords is trying to return everything to the state as it was before. Negotiations between Brussels and London will continue beyond this week, at the end of which Johnson set a deadline. Another deadline. One of the high-ranking EU officials said that the parties are unlikely to be able to reach a consensus by the end of the week, perhaps it will be done next week. It might have seemed that this was a real hope for a deal, but the same official also made an important assumption: "if there is no failure in the negotiations." Thus, failure is still possible and highly probable.

The UK is set to publish important data on GDP for September, for the third quarter, as well as industrial production for September. Forecasts predict that the main indicator of the economy will grow by 15.8%, which is not that much after falling by 19.8% in the second quarter. If the real figures turn out worse, then the pound may continue to fall. Bank of England Andrew Bailey is set to deliver a speech today, he could provide interesting information.

We have two trading ideas for November 12:

1) Buyers for the pound/dollar pair were unable to overcome the resistance level of 1.3266. Thus, we recommend buying the pair if the pair rebounds from the Kijun-sen line (1.3187) while aiming for the resistance levels of 1.3266 and 1.3382. Take Profit in this case will be from 50 to 160 points.

2) Sellers do not currently own the initiative in the market. If the price settles below the 1.3160 ]-1.3184 area, you can try to sell the pound/dollar pair while aiming for the trend line. Take Profit in this case can be up to 30 points. But it is better to wait until the trend line is overcome and sell the pair more confidently with the targets Senkou Span B line (1.3030) and support level of 1.2943. Take Profit in this case will be from 60 to 140 points.

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 12. COT report. Analysis of Wednesday's deals. Thursday recommendations

EUR/USD 1H

analytics5fac98334e90e.jpg

The EUR/USD pair continued to move down on the hourly timeframe on Wednesday, November 11. Thus, after failing to overcome the resistance area of 1.1886-1.1912, the bears continue to put pressure on the pair. A day earlier, we predicted that if the Kijun-sen line was crossed, the pair would continue moving down to the Senkou Span B line. And so it happened. The only thing is that the price has not yet had time to fall to the Senkou Span B line, and the Kijun-sen line itself went above the pair's quotes. However, in general, the pair will continue moving down. Sellers still have many significant barriers ahead. In particular, it will be necessary to overcome the Senkou Span B line, which is one of the last frontiers before forming a downward trend. However, take note of several important points. Firstly, the price rebounded from the upper line of the horizontal channel at $1.17-1.19, so it is likely for it to fall to 1.1700. Second, there is still no trendline or trend channel, so the current downward trend is not strong. The biggest question now is how the pair will behave around the 1.1700 level. Tension in the foreign exchange market continues to subside, as the elections are left behind, and Donald Trump has not yet begun to implement his plan to revise the voting results, in addition to various kinds of threats. Therefore, the dollar really can still rise.

EUR/USD 15M

analytics5fac98367f8e6.jpg

Both linear regression channels are directed to the downside on the 15-minute timeframe. However, the key moment now is the price rebounding from the 1.1886-1.1912 area, which triggered a downward movement, which is still corrective. In order for it to fall further, sellers need to confidently overcome the Senkou Span B line. This line is also the closest target. There are no signs of completing the downward movement on the lower timeframe.

COT report

analytics5fac9839c9005.jpg

The EUR/USD pair lost 170 points during the last reporting week (October 27-November 2). A strong upward movement began after this time range. Therefore, the fact that the pair gained 220 points simply does not fall within the timeframe of the latest Commitment of Traders (COT) report. According to it, professional traders closed 9,200 Buy-contracts (longs) and opened 7,800 Sell-contracts (shorts). Thus, the net position for non-commercial traders decreased by 17,000 at once. And any decrease in the net position indicates a strengthening of the bearish mood. Consequently, professional traders continue to look towards selling the euro. Therefore, even despite the subsequent growth, we still believe that the high near the 1.2000 level will still be the peak of the entire upward trend. At least the COT data continues to signal just that. The technical analysis may contradict the COT report, as the latter comes out with a three-day delay. We cannot now know how the big players behaved in the period from November 3 to 6, which is when the dollar was significantly falling due to the elections. Indicators are also signaling good prospects for a new downward trend, as the green and red lines continue to narrow (the first indicator). And they, we recall, reflect the net positions of non-commercial traders and commercial ones.

The fundamental background was rather weak on Wednesday. Not a single important macroeconomic report. European Central Bank President Christine Lagarde delivered a speech, but she did not say anything extra interesting. And in any case, it could hardly provide support to the European currency, since the situation with the coronavirus remains difficult in Europe, which means that the economy will begin to slow down at best, and contract at worst. Consequently, it may need new incentives, as Lagarde mentioned on Wednesday. Also take note of Donald Trump's attacks, who continues to threaten to revise the election results and has already announced "great progress" and "results next week." The US president did not provide any details about it.

Germany is set to publish its consumer price index for October, which is forecast to remain at -0.2% y/y. Harmonized inflation is also likely to remain negative at -0.5% y/y. EU industrial production in September is forecast at +0.7% compared to August, which is not much. US Inflation should be 1.3%-1.4% on an annualized basis. Lagarde is also set to deliver another speech today. Therefore, all macroeconomic reports look as neutral as possible so far, and only strong deviations of actual values from forecasts can cause a reaction from traders.

We have two trading ideas for November 12:

1) Buyers need to wait until they have gone beyond the 1.1886-1.1912 area in order to open new buy positions on the pair with the nearest target at the resistance level of 1.1976. Or wait for the price to rebound from the Senkou Span B line (1.1730) and trade up while aiming for the Kijun-sen line (1.1833) and the resistance area of 1.1886-1.1912. Take Profit in the first case will be up to 50 points, in the second - up to 120 points.

2) Bears took the pair below the critical line. However, they now need to break the Senkou Span B line (1.1730) in order to continue trading down with support targets at 1.1692-1.1699 and 1.1612-1.1624. Take Profit in this case can range from 20 to 90 points.

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

The British pound at a crossroads: up or down

analytics5fac173815c69.jpg

The British currency broke growth records yesterday. So, the British pound against the euro reached its highest level in more than two months. Similar highs were recorded against the dollar. If the growth of the GBP/USD pair can be explained by the weakness of the US dollar, then looking at the fall of the EUR/GBP, it is necessary to look for positive factors from the British currency, and the traders found them. First of all, buyers of the pound were optimistic about the news of Joe Biden's victory, the Democrat President is expected to put pressure on the British government to conclude a trade deal with the EU.

"Northern Ireland is a 'sensitive topic' for Biden, due to the fact that he supported the peace process. At the same time, he seems to be in favor of "diplomacy, unity, and cooperation," ergo he can be critical of the split between the UK and the EU," according to Commerzbank.

The second reason is Pfizer's experimental COVID-19 vaccine. Due to the news that it is 90% effective, global markets reacted with a sharp increase. Traders felt that a drug that might be available would soon be a particular boon for the UK, as its economy has been ravaged by the coronavirus.

Traders of the pound feared that the consequences of another nationwide lockdown, combined with a tough scenario for the country's exit from the EU, could push the Bank of England to introduce negative rates in January.

Today the GBP/USD pair was approaching 1.33, up more than 1% since Monday and reaching its highest level since September. During the US session, the quote retreated from the highs, which is mainly due to the growth of the US currency, which resumed growth.

analytics5fac168b6b31b.jpg

Against the euro, the pound rose about 0.2% to 88.785 pence per euro, but also retreated from highs.

If a breakthrough on Brexit does occur and hopes for a coronavirus vaccine are justified, the EUR/GBP rate may head towards the 0.86 mark.

analytics5fac16ee423f3.jpg

Britain left the EU in January, and both sides are in talks to agree a trade deal. The transition period ends on December 31.

However, some experts are skeptical about the possible conclusion of a deal within the specified period. Biden stressed the importance of protecting the Northern Ireland peace agreement in the Brexit process when he called British Prime Minister Boris Johnson on Tuesday. But in a short period of time, it will be difficult to reach an agreement with the EU that even remotely resembles one that offers full access to the internal market.

In this scenario, the British economy will face not only the consequences of the coronavirus, but also the obstacles associated with the fact that trade will be less free than during the transition period. It is unlikely that the pound will like it.

There are two interesting facts about the vaccine. First, the medicine must be stored at a temperature of minus 70C. And naturally, this raises doubts about the possibility of mass and rapid vaccination. Second, the head of Pfizer sold 60% of his shares in the company on the day of the announcement of the results of the vaccine trials, when the papers were on top.

In the very near future, the positions of risky assets may be shaken due to new social restrictions in the United States, and the market did not take this into account. In Europe, the incidence curve in America has become vertical.

In the economy of the Euroblock, the main focus now is on assessing the damage of the second lockdown. Published yesterday, November business climate indicators from ZEW for the European economy and Germany fell short of the forecast. It seems that the ECB at the December meeting will ease monetary policy more than initially expected. Therefore, the euro is gradually losing ground against other currencies. If this is indeed the main reason for the current movement of the euro, then the factor of the ECB meeting will be the main one in the short term.

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