Analytics and trading signals for beginners. How to trade the GBP/USD currency pair on November 16? Preparation for trading

The hourly chart of the GBP/USD pair.

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For the GBP/USD currency pair, trading during the last trading day and the entire week as a whole raised a lot of questions. In short, the pound continues to rise in price at a time when there is no particular reason for this. It continues to rise in price when it would be most logical to fall. However, as we have said many times, traders move the markets, not news or fundamental background. Fundamental analysis is very important and often predicts the long-term trends of the pair. However, at this time, it does not correspond to what is happening in the market for the pound/dollar pair. The upward trend line keeps the British pound's prospects up. Thus, it is still recommended to consider trading for an increase until this line is crossed. We cannot say that the pound/dollar is now in a side channel in the long term, as the euro/dollar pair, so the pairs are moving differently now. This, in turn, means that the main reasons for the price movement are not in the US dollar.

The fundamental background for the British currency over the past week has been "moderately negative", but in general, it remains simply "negative". Last week, the UK released several macroeconomic reports (unemployment, GDP, industrial production), which once again confirmed that the British economy is experiencing problems. On the one hand, who is not experiencing them now? On the other hand, the crisis in the UK is much deeper than in many EU countries, even those that are most severely affected by the "coronavirus" infection. The UK was the most affected EU country by COVID-2019 during the first "wave". Currently, only Spain and France "overtake" Britain in this sad rating. However, Britain still ranks as one of the top countries in terms of daily recorded cases of the disease and the first in Europe in terms of the number of deaths from COVID. Needless to say, all these "anti-records" will affect the economy. On its recovery and/or growth. And apart from the immediate problems, London can't agree with Brussels on a trade agreement that will allow them to trade without duties after Brexit, that is, as they do now, when Britain is still a member of the European Union. If there is no deal, and everything goes to the point that there is no deal, then this will be a new, additional blow to the British economy. We have already said in our fundamental articles that the losses from Brexit for the UK amount to tens or even hundreds of billions of pounds. And Britain began to bear these losses back in 2016. And will continue to carry them into 2021, even if a trade deal is still in place. However, if an agreement is not reached, the losses will be higher. These are no bright prospects for the British economy.

On November 16, the following scenarios are possible:

1) Purchases of the pair look more relevant now, as the upward trend, which is signaled by the trend line, remains. However, it is possible that in the near future the trend line will be overcome and a downward trend will begin. However, until this happens, it is recommended to trade for an increase with the target of 1.3272. The MACD indicator has formed a buy signal near the trend line. At this signal, you can still stay in purchases, or wait for the next one.

2) Sales, from our point of view, are not appropriate now. To have a reason to sell the pound/dollar pair, novice traders should wait for the price to consolidate below the ascending trend line. In this case, it is recommended to open sell orders with the target level of 1.3072.

What is on the chart:

Price support and resistance levels – target levels when opening purchases or sales. You can place Take Profit levels near them.

Red lines – channels or trend lines that display the current trend and indicate which direction is preferable to trade now.

Up/down arrows – show when you reach or overcome which obstacles you should trade up or down.

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

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

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

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

Analytics and trading signals for beginners. How to trade the EUR/USD currency pair on November 16? Analysis of Friday's

The hourly chart of the EUR/USD pair.

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On Friday, the EUR/USD currency pair "went" along the downward trend line for quite a long time. However, it overcame this line and continued the upward movement that began a few days ago. Thus, the first and most important thing to note is that the euro/dollar pair continues to trade inside the side channel of 1.1700-1.1900. Moreover, it is currently trading exactly in the middle of this channel. Thus, in the long term, sideways movement is maintained. Secondly, if we look at short-term trends inside this side channel, we see a new trend – an upward one. However, once the descending line has been overcome, then novice traders should now consider trading for an increase. As for the prospects of the currency pair, the upward movement may continue up to the upper line of the side channel – 1.1903. For the movement to continue above this level, the level of 1.1903 must be overcome.

During the fifth and last trading day of the week, there were a lot of planned events, however, most of them were boring and uninteresting. If you look at the chart of the pair's movement on Friday, it becomes clear that traders were not interested in any event of the day, since the total volatility was as much as 38 points. This is a minimal value, which is very rare. The speeches of Jerome Powell (Fed Chairman) and Christine Lagarde (ECB Chairman) did not attract any attention at all, because the speeches of both central bankers did not contain anything interesting related to the economy or monetary policy. Thus, the main event of the day was the report on inflation in the United States. And this indicator disappointed traders. The main indicator decreased from 1.4% per annum to 1.2% per annum. The consumer price index excluding food and energy declined from 1.7% to 1.6% y/y. Thus, in general, the decline in the US currency during the day was logical but very weak.

No major events are scheduled for Monday in either the European Union or the United States. Therefore, novice traders can only track the news of the general fundamental background. For example, messages from Donald Trump, who continues to fight for the 2020 election. Or reports of a coronavirus or a vaccine. However, we believe that Monday can be extremely boring and volatility will be low, just like on Friday. However, this does not mean that there can't be a stronger movement in principle. We remind novice traders that it is traders who drive markets, not news or reports.

On November 14, the following scenarios are possible:

1) Since traders managed to take the pair above the downward trend line, long positions have now become relevant. The growth potential of the euro currency, as always, is limited to the level of 1.1903, but even before this level, you can manage to earn several dozen points. The bad thing is that now the movement is very weak, which is fraught with frequent reversals of the MACD indicator in different directions. Therefore, it is recommended to trade for an increase cautiously, with targets of 1.1860 and 1.1896.

2) Trading on the downside is no longer relevant at this time, as the downward trend has been canceled. Thus, novice traders are advised to wait now for the eloquent end of the upward trend or the formation of a new downward trend to have a reason to open short positions.

What's on the chart:

Price support and resistance levels – target levels when opening purchases or sales. You can place Take Profit levels near them.

Red lines – channels or trend lines that display the current trend and indicate which direction is preferable to trade now.

Up/down arrows – show when you reach or overcome which obstacles you should trade up or down.

MACD indicator (14,22,3) – a histogram and a signal line, the intersection of which is a signal to enter the market. It is recommended to use it in combination with trend lines(channels, trend lines).

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

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

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