GBP/USD: plan for the European session on November 19. COT reports. Lack of good news on Brexit weighs on the pound

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

Yesterday's sales from 1.3310 brought quite good profit. In yesterday's forecast, I drew attention to the 1.3310 area and advised you to open short positions from it. If you look at the 5-minute chart, you will see how the buyers failed to break the 1.3310 level, and the bears took advantage of this and formed a false breakout, which then caused an excellent entry point for short positions to appear.

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Traders will focus on 1.3237, since the pair's succeeding direction depends on who takes control over it. Buyers need to gain a foothold above 1.3237 and test it from top to bottom, which will produce a convenient entry point to long positions in hopes for the pair to return to the resistance area of 1.3310, which is where the pair mainly fell yesterday. Settling above 1.3310 will lead to a more powerful bullish momentum, in anticipation of updating the highs 1.3378 and 1.3476, which is also where I recommend taking profits. However, such a scenario will only be possible if we receive progress on Brexit talks. In case GBP/USD falls further, it is best not to rush into buy positions, but to wait for the update of a large low at 1.3168, from where you can open long positions on a rebound during the first test of this range, counting on a correction of 20-25 points. In case bulls are not active in this area, I recommend buying the pound only at a larger local low of 1.3106.

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

The bears have taken a wait-and-see attitude and the main focus is now on protecting resistance at 1.3237. Sellers' behavior at this level will determine the pair's succeeding direction. If buyers are not active, then forming a false breakout in the 1.3237 area will be the first signal to open short positions in the pound, counting on it to fall to support 1.3168, which is now the middle of the horizontal channel. We can only say that the bears have taken control of the market when they have settled below the 1.3168 level, which will quickly pull down the pound to the lower border of this channel at 1.3106, where I recommend taking profits. We can speak of a breakthrough of this range only if we receive news of another failed negotiations on a trade agreement, which will pull down the pound to the area of the lows of 1.3034 and 1.2976, where I recommend taking profit. In case bears are not active at 1.3237, it is best to postpone short positions until the test of the monthly high of 1.3310, or sell the pound immediately upon a rebound from resistance 1.3378, counting on a downward correction of 20-30 points within the day.

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The Commitment of Traders (COT) report for November 10 showed a slight increase in long positions and a sharp inflow of short positions. Long non-commercial positions rose from 27,701 to 27,872. At the same time, short non-commercial positions increased from 38,928 to 45,567. As a result, the negative non-commercial net position was -17,695, against -11,227 weeks earlier, which indicates that the sellers of the British pound retains control and also shows their minimal advantage in the current situation.

Indicator signals:

Moving averages

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

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 classic daily moving averages on the D1 daily chart.

Bollinger Bands

A breakout of the lower border of the indicator around 1.3235 will increase the pressure on the pound. Growth will be limited around the upper border of the indicator in the 1.3310 area.

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 19. COT reports. Euro will fall, bears aim for 1.1832

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

Buyers of the euro made an attempt for a breakout and tried to settle above the resistance of 1.1868 yesterday, which produced a good signal to enter long positions. I marked the entry point on the 5-minute chart. Testing this level from top to bottom worked perfectly, afterwards the euro grew. However, it was not possible to break above the weekly highs, and the eurozone inflation data discouraged traders from being more active. As a result, we could see the euro return to the area under 1.1868, testing it from the bottom up produced a good sell signal, which caused the pair to return to a low of 1.1832.

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Not much has changed from a technical point of view. Support at 1.1832 has already been tested today, and buyers will focus on this level in the first half of the day. If the euro bulls manage to protect support at 1.1832 once again, then a false breakout there will be a good entry point for long positions in hopes for the pair to reach the resistance area of 1.1868, where the pair might temporarily stop rising. Getting the pair to settle at this level will open a direct road to the next target, which is the monthly high of 1.1915, where I recommend taking profits. In the morning, the focus will be tied to the speech of European Central Bank President Christine Lagarde, since no other important fundamental events are planned. If the bulls are not active in the 1.1832 area, then we might see EUR/USD under this range. In this case, buyers will focus on protecting support at 1.1797. You can open long positions from it but only on the first test, counting on a correction of 15-20 points within the day. A larger reversal in favor of buyers will occur if they manage to form a false breakout at 1.1743.

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

The sellers' initial task is to test the 1.1832 level, which they tested for strength in today's Asian session. Settling below 1.1832 and testing it from the bottom up forms a more convenient entry point to short positions in hopes to bring back the downward trend. In this case, the nearest target will be the low of 1.1797. Testing this level will only be an indication that the pair is stuck in a horizontal channel. A breakdown and consolidation below this range will lead EUR/USD to the area of the lower border of the 1.1749 horizontal channel, where I recommend taking profits. We can only talk about returning the bearish trend after going beyond this area, which will quickly pull down the pair to the 1.1701 low. If the bulls turn out to be stronger and continue to push the pair after the speech of Lagarde and her representatives, then it would be best not to rush to sell, but wait for an update of the larger resistance at 1.1868. However, you can only sell from this position if a false breakout appears there. I recommend opening short positions in EUR/USD immediately on a rebound from the monthly high of 1.1915, counting on a correction of 15-20 points within the day.

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The Commitment of Traders (COT) report for November 10 showed a reduction in long and short positions. Euro bulls are holding on to a wait-and-see attitude and are in no hurry to return to the market even after the US presidential elections. Despite this, buyers of risky assets believe that the bull market will continue, although they prefer to proceed with caution. Thus, long non-commercial positions decreased from 208,237 to 202,374, while short non-commercial positions remained practically unchanged, falling from 67,888 to 67,087. The total non-commercial net position decreased to 135,287 against 140,349 a week earlier. It is worth noting that the delta has been declining for seven consecutive weeks, which confirms the buyers' lack of desire to enter the market in the current conditions. Growth will only begin after Joe Biden's victory as he intends to endow the American economy with the next largest monetary aid package worth more than $2 trillion.

Indicator signals:

Moving averages

Trading is carried out just below the 30 and 50 moving averages, which indicates the likelihood of the euro's succeeding decline.

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 classic daily moving averages on the D1 daily chart.

Bollinger Bands

A breakout of the lower border of the indicator around 1.1832 will increase pressure on the euro. A breakout of the upper border of the indicator in the 1.1870 area will lead to a new wave of growth for the pair.

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

Technical Analysis of EUR/USD for November 19, 2020

Technical Market Outlook:

The EUR/USD pair has been moving up inside of a ascending channel towards the level of 1.1879, but another Bearish Engulfing candlestick pattern has been made at the level of 1.1890. The pull-back towards the channel lower boundary line might have been completed, so if the line holds, then the bulls will be in control of the market again and might push the price higher towards the swing high seen at the level of 1.1920. The strong and positive momentum supports the bullish short-term outlook for Euro. Please notice the overbought market conditions might cause temporary pull backs along the way up.

Weekly Pivot Points:

WR3 - 1.2099

WR2 - 1.2008

WR1 - 1.1924

Weekly Pivot - 1.1834

WS1 - 1.1747

WS2 - 1.1659

WS3 - 1.1571

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

Technical Analysis of GBP/USD for November 19, 2020

Technical Market Outlook:

The GBP/USD pair has made another high at the level of 1.3310, but no follow through happened and the market reversed after Pin Bar candle had been made. The bears has pushed the price lower towards the level of 1.3240, which is out of the short-term channel zone. The local technical support is seen at the level of 1.3240 and 1.3165, so as long as GBP trades above this levels the outlook remains bullish. The higher time frame trend remains up as well with a target seen at the level of 1.3380.

Weekly Pivot Points:

WR3 - 1.3481

WR2 - 1.3397

WR1 - 1.3286

Weekly Pivot - 1.3197

WS1 - 1.3085

WS2 - 1.2994

WS3 - 1.2882

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

Technical Analysis of BTC/USD for November 19, 2020

Crypto Industry Outlook:

In a thread posted on Twitter, Ray Dalio stated that he believes that Bitcoin is not an effective medium of exchange or a means of custody due to its volatility. He also assured that governments could ban crypto assets if they became a threat to fiat currencies. However, he also admitted that he "may have missed something" and invited others to join their explanations.

I can't imagine central banks, big Institutional investors, businesses or multinational companies using [Bitcoin]," said Dalio. "If I'm wrong about these things I would love to be corrected."

Dalio's comments came after Bitcoin's price soared as its price exceeded $ 17,500 in less than 24 hours. The booming news has led many collaborators in space to share their views with the billionaire.

Dalio said last Thursday that he believes governments are likely to step up their efforts to curb cryptocurrencies if they see significant increases. His comments came when Bitcoin's price was about $ 2,000 lower than it is today.

Technical Market Outlook:

The BTC/USD pair has made another yearly high at the level of $18,389 and the way to $20k remains intact. The market volatility has increased as the Bitcoin trades in the upper boundary of the ascending channel. The market might be developing a Triangle pattern, so the break out of it might be up. The intraday technical support is seen at the level of $17,000 and the technical resistance is now a swing high located at $18,389. As long as the market trades above the level of $15,000 the short-term outlook remains bullish.

Weekly Pivot Points:

WR3 - $18,219

WR2 - $17,297

WR1 - $16,656

Weekly Pivot - $15,563

WS1 - $14,969

WS2 - $14,056

WS3 - $13,330

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 $20,000, 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 $15,000 is broken.

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

AUD/USD. Australian dollar is under pressure from COVD-19

The Australian dollar reacted very cautiously to the strong labor market data, which was published during the Asian session. The reason for this is COVID-19, which stresses AUD/USD traders again. Despite successful development of vaccines against the said virus, COVID-19 is still exerting massive pressure on the AUD. The new quarantine restrictions, which is affecting South Australia this time, may slow down the economic recovery of the country again. In view of this, previous macroeconomic successes do not look so relevant anymore. And although the country also had quarantine restrictions throughout October, it can still be seen that the Australian labor market coped quite well with the challenge and even showed some achievements.

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According to general forecasts, October's unemployment rate was supposed to rise to 7.2% (from the previous value of 6.9%), but it grew up to 7% only. The growth of employment data also certainly did not justify the analysts' pessimistic forecasts. Last month, the indicator fell into the negative zone for the first time since May this year, when Australia was at the peak of the coronavirus crisis. And according to experts' expectations, this indicator was also supposed to show negative dynamics, which is expected to decline by 29 thousand. However, it turned out the other way around: the indicator rose, reaching 178 thousand. This is the strongest growth rate since June this year, when Australia began to lift lockdown.

It should also be stressed out that the growth in the employment rate was not solely due to the growth of part-time employment. The full-time employment data also increased by 97 thousand, while the partial one was by 81 thousand. We believe that the number of full-time positions will have a positive effect on the consumer activity of Australians in the future, as well as on inflationary processes. Therefore, today's result is also positive in this aspect. It is also noteworthy that the share of the economically active population has grown to 65.8%, which is the best result since March this year.

You should bear in mind that the values published today cover the period from the end of September to the second half of October. At the same time, the Australian authorities announced last October 26 that Melbourne could gradually come out of quarantine. There were severe restrictive measures and even a curfew prior to that. The lockdown in Melbourne was extended several times – in total, it was in effect for almost four months.

During this time, all shops, restaurants, cafes and bars were closed, and sports were only allowed outdoors. The economic consequences of the tightening of quarantine were reflected not only at the local level. For example, problems arose with the supply chain, since this region is the location of the largest container port in the country. In other words, the coronavirus crisis in this State has affected the whole country, but the labor market has shown a very good result amid such restrictions in the largest region of the country.

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The AUD only impulsively surged to the borders of the level of 0.73 and went back almost immediately, despite the fact that one of the key macroeconomic releases came out in the "green zone". The Australian Nonfarms did not become a catalyst for the growth of AUD/USD pair, although all the prerequisites for this were. The blame is on COVID-19, which closed one of the country's States again and this time, South Australia.

There was not a single case of COVID-19 recorded there for six months, but a few days ago, the virus was found in 36 people at once. Therefore, the local authorities reacted right away – the almost two million region was closed for at least a week. Moreover, people were ordered not to leave their homes (including for jogging), all schools and universities, restaurants, cafes, shops (even without the possibility of ordering food "to go") were closed, masks were introduced in public places and long-distance travel was banned. After a tough six-day quarantine, authorities plan to practice lax restrictions over the next two weeks, gradually emerging from a complete lockdown.

Such news defeated the Australian dollar's position. Therefore, the corrective pullback of the AUD/USD pair can be quite massive. The pair is expected to decline up to the base of the 72nd figure, particularly to the support level located at 0.7220 (upper border of the Kumo cloud on the daily chart). And although long positions are still relevant in the medium and long term, it is not suggested to buy in the near future, since there is a risk of drawdown. If the indicated pair slows down and/or drifts at the bottom of the 72nd figure, longs will be in priority again, with the main goal of 0.7300.

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

GBP/USD trading plan for 19 November

GBP/USD stands on slippery grounds after stepping back from the monthly high 1.3310 in the previous day. Currently, GBP/USD is consolidating losses in response to the news from London. The cable lost ground after The Times triggered chatters over no-deal Brexit.

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GBP/USD dropped from 1.3270 to 1.3225 within a few hours during Thursday's Asian session. This bearish move breaks below the upward sloping trend line from November 13 and invites the GBP/USD sellers back to the market. Trading for a bearish move at this time is relevant after a pullback is confirmed since there is a breakout of the uptrend and an early indication of a trend reversal on the grounds of MACD bearish divergence formation.

The price must settle below 1.3225 in order to form a condition to decline further. Thus, traders are advised to wait for a pullback or sign of buyers' strength below 1.3255 to open short positions with targets at 1.3190 and 1.3110 which coincide with 261.8% and 423.6% fibonacci extension levels.

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

Technical Analysis of ETH/USD for November 19, 2020

Crypto Industry Outlook:

Crypto provider Bitcoin Suisse expects to offer its Ethereum staking services ahead of Christmas, highlighting the company's expectations for the imminent launch of Ethereum 2.0.

In a statement released through Trustnodes, Bitcoin Suisse said:

"The escrow deal for Ethereum 2 is now active. This means that the new version of the second largest protocol in terms of market capitalization is likely to become a reality by Christmas."

Bitcoin Suisse was founded in 2013, making it one of the first cryptocurrency-focused financial service providers.

The Ethereum 2.0 Deposit Agreement is open-ended meaning anyone wishing to become a validator can deposit the 32 ETH minimum stake. On Wednesday, the deposit agreement covered over 101,700 ETH deposits worth nearly $ 48.2 million.

According to a blog post on the Ethereum Foundation earlier this month, the first phase of ETH 2.0 is expected to launch on December 1. The developers have set a minimum total threshold of 524.288 ETH as a trigger for the main network. The target must be achieved at least seven days in advance, which is November 24.

Technical Market Outlook:

The ETH/USD pair might have been developing the Triangle pattern at the H4 time frame around the level of $470. The nearest technical resistance is seen at the level of $487.70. If the price will break out from the potential Triangle pattern to the upside, then the nearest target is seen at the level of $500. Only if a daily candle closes below $360 level, then the bears will have full control of the market and might push the prices deeper below this level.

Weekly Pivot Points:

WR3 - $507.71

WR2 - $490.25

WR1 - $463.71

Weekly Pivot - $448.80

WS1 - $421.33

WS2 - $405.66

WS3 - $377.90

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 $360 is broken.

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

Elliott wave analysis of GBP/JPY for November 19, 2020

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The risk-off attitude in overnight trading has changed the corrective shape from 140.32 and more downside pressure towards 136.20 should be expected in a deeper sub-wave correction. Once this correction is complete near 136.20, renewed upside pressure will be expected towards 138.87 and ultimately above 142.72.

Only an unexpected break below the trendline-support at 134.85 will force a recount of our bullish outlook.

R3: 138.87

R2: 138.22

R1: 137.78

Pivot: 137.48

S1: 137.16

S2: 136.77

S3: 136.20

Trading recommendation:

Our stop at 137.45 has been hit for a nice 200 pips profit. We will re-buy GBP at 136.40 or upon a break above 137.95

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

Elliott wave analysis of EUR/JPY for November 19, 2020

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EUR/JPY continued lower changing the corrective shape, we had been favoring into a deeper correction that likely will move closer to solid support near 122.37 before the next impulsive rally higher. Only a break above minor resistance at 123.26 will indicate an early completion of the correction and call for renewed upside pressure towards 124.44 and a break above here will confirm the impulsive rally is in motion.

Taking a step back, EUR/JPY can been correcting since mid-August and has more or less been moving sideways in a larger corrective pattern and if our count is correct, then we are in the early parts of a new larger impulsive rally, that should break above the former peak at 127.02.

R3: 123.95

R2: 123.57

R1: 123.26

Pivot: 123.13

S1: 122.82

S2: 122.64

S3: 122.37

Trading recommendation:

Our stop at 123.35 was hit for a nice 100 pips profit. We will re-buy EUR at 122.50 or upon a break above 123.26

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

EUR/USD: trading signals for 19 November

EUR/USD jumps to 1.1890 and buyers are struggling to breach the resistance level. This level was tested on 17 November, and once again it failed to overcome the area on 18 November. Therefore, EUR/USD rebounded from the resistance zone and broke below the supporting bullish ascending channel. The breakout of previous swing low and supporting trend line on the hourly chart signals an early hint of on upward trend reversal.

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In the previous article we warned that the bullish movement is unlikely to resume if a failure to breach the resistance or price settlement below the trend line change the current uptrend to the downtrend. Hence, it is not advisable to buy in the area of the horizontal channel 1.1900.

This morning, the price touched 1.1830 and we might see a short pullback move today. The price must settle below this level in order to form a condition to decline further. Trading for a bearish move at this time is relevant after a pullback is confirmed since there is a breakout of the uptrend. Thus, traders are advised to wait for a reversal or sign of buyers' weakness below 1.1860 which coincides with 50% retracement in order to open short positions with targets at 1.1820 and 1.1780.

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

Analytics and trading signals for beginners. How to trade EUR/USD on November 19? Plan for opening and closing trades on

Hourly chart of the EUR/USD pair

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The EUR/USD pair has settled below the upward trend line last night, as we predicted. And so novice traders received a sell signal on the breakout of the trend line, and those who did not sleep when it appeared could open short positions and gain a small profit. Yes, this is the foreign exchange market, signals can appear even at night, when many in our respective time zones are asleep. Therefore, the support level of 1.1838 has been reached, from which the pair rebounded and can now start an upward correction. At the same time, do not jump to conclusions. The European trading session is just beginning, and the sell signal is strong enough. Therefore, we believe that we might see a downward movement in the next hour or two. In any case, novice traders will have reasons to close short positions if the MACD indicator turns to the upside. However, even in this case, it is better to move Stop Loss to breakeven and try to wait for a stronger fall in the euro's quotes.

European Central Bank President Christine Lagarde will speak on Thursday, November 19. Most likely, there is one event, but the ECB chairman has three speeches. However, as we said, Lagarde has been speaking almost every day and does not mention anything new and fundamentally important. Therefore, traders have nothing to react to: Lagarde simply does not touch on the topic of monetary policy and the EU economy. No important events are planned for the day. Data on applications for unemployment benefits will be released in the US, this report was quite significant at the very beginning of the epidemic, but not right now. Although, if the number of applications starts to grow, this will mean that the strengthening of quarantine measures in many states is starting to negatively affect the economy and we can expect a new rise in unemployment and a decrease in GDP. Recall that the coronavirus is not only present in America right now, it is raging and has become a hotbed of COVID-19, with more than 150,000 cases of the disease recorded there every day. Although it is difficult for the dollar to find support in such conditions, one should not forget that the pair has been trading in the 1.1700-1.1900 horizontal channel for three months already and it has a priority value now. Quotes have reached its upper border and will now tend to the lower one.

Possible scenarios for November 19:

1) Long positions are no longer relevant, since the price has settled below the upward trend line, therefore, the trend has changed to a downward trend. So now you can only return to buying the euro when the current downward trend has ended. Under current conditions, the only option is to overcome the 1.1903 level, which will mean that the pair will leave the 1.1700-1.1900 horizontal channel.

2) Trading for a fall has become relevant at this time, since the trend has changed to a downward one. Novice traders could open short positions when the price has settled below the trend line and you can aim for 1.1838 and 1.1822. At the moment, you can keep sell orders open with targets at 1.1822 and 1.1796 until the MACD indicator turns to the upside. Or move Stop Loss to breakeven and wait for a stronger fall.

On the chart:

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

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

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

The MACD indicator (14,22,3) consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend lines (channels and trend lines).

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

Beginners on Forex should remember that not every single trade has to be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.

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

Indicator Analysis. Daily review for the EUR / USD currency pair 11/19/20

Trend analysis (Fig. 1).

Today, the market may continue to move downward from the level of 1.1852 (closing of yesterday's daily candle) with the target of 1.1811 at the historical support level (blue dotted line). When testing this level, there will be further work going downward with the target of 1.1798 at the retracement level of 38.2% (red dotted line). Upward work is possible from this level.

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Figure: 1 (daily chart).

Comprehensive Analysis:

  • Indicator Analysis - down
  • Fibonacci levels - down
  • Volumes - down
  • Candlestick Analysis - down
  • Trend Analysis - down
  • Bollinger Lines - up
  • Weekly Chart - up

General conclusion:

Today, the market may start moving down from the level of 1.1852 (closing of yesterday's daily candle) with the target of 1.1811 at the historical support level (blue dotted line). When testing this level, there will be further work going downward with the target at 1.1798 at the retracement level of 38.2% (red dotted line). Upward work is possible from this level.

Alternative scenario: when moving down and testing the historical support level 1.1811 (blue dashed line), the price may start moving up with the target of 1.1832 at a retracement level of 50.0% (blue dashed line). When testing this level, there will be further work going upward with the target of 1.1853 at the 61.8% retracement level (blue dotted line).

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

Indicator analysis. Daily review for the GBP / USD currency pair 19/11/2020.

Trend analysis (Fig. 1)

Today, from the level of 1.3264 (the closing of yesterday's daily candle) the market can continue to work down with the goal of 1.3117 which is a pullback level of 14.6% (red dotted line). After testing this line, continue working down with the target of 1.3159 which is a pullback level of 23.6% (red dotted line). When this level is reached, it is possible to work up.

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Figure 1 (daily chart).

Complex analysis:

  • Indicator Analysis – down
  • Fibonacci Levels – down
  • Volumes – down
  • Technical Analysis – down
  • Trend Analysis – down
  • Bollinger Bands – up
  • Weekly Chart – down

General conclusion:

Today, from the level of 1.3264 (the closing of yesterday's daily candle), the price can continue to work down with the goal of 1.3117 which is a pullback level of 14.6% (red dotted line). After testing this line, continue working down with the target of 1.3159 which is a pullback level of 23.6% (red dotted line). When this level is reached, it is possible to work up.

Alternative scenario: When moving down and reaching the pullback level of 14.6% at 1.3117 (red dotted line), the market will try to move up with the goal of 1.3211 which is the upper fractal (red dotted line).

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Will the US dollar continue to weaken after recent growth?

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There are debates everywhere that the US dollar will weaken entirely. However, people should remember that this currency has a hidden potential, which may turn out to be a trump card for the world economy.

Experts think that one of the important reasons for the dollar's weakness was the sharp decline in demand for protective currencies, to which it belongs. This low demand was preceded by a decline in US business activity. Moreover, the negative report of the country's retail sales also supported this gloomy outlook. According to current reports, retail sales increased by only 0.3% last month, compared to September's growth by 1.6%. At the same time, the US industrial production also released a disappointing report: last month's growth was only 1.1%, although an increase of 5.6% was recorded in February, before the start of the COVID-19 pandemic. Due to this, investors became worried of the current situation, who expect a further decline in retail sales, in view of the worsening pandemic situation in America.

The strong collapse of the US Treasury bond is also considered as another key driver why the dollar is declining. Currency strategists at Societe Generale Bank believe that the collapse in real yields on US securities occurred after the Fed cut interest rates and introduced quarantine measures amid the pandemic. So, the predominance of negative factors doubts the successful economic growth in the country in the short and medium term.

Moreover, experts pay attention to the fundamental weakness of the US dollar, which remains under instability pressure for five consecutive days. However, this currency continues to strive to leave the downturn. Yesterday, the EUR/USD pair rose to 1.1890, whichadded 0.2%. These analysts were inspired, so they expected the classic pair to rise to the psychologically important level of 1.1900. However, the situation changed dramatically the next day. Today, the EUR/USD pair fell sharply, hovering around the low levels of 1.1846-1.1847. Further attempts to enter the upward trend occurred with varying success.

According to economists, the excess of the US dollar in the global financial system has a positive effect on the dynamics of the EUR/USD pair. This week, the Fed and the US Treasury have poured impressive amounts of liquidity into the economy. As a result, most investors had to get rid of the dollar, which led to its increased pressure.

Such measures favored the Euro, which did not miss its chance and sharply rose. However, experts consider this a temporary phenomenon. Euro's further growth is hindered by a sharp increase in assets on the ECB's balance sheet, which increased by € 36.57 billion this week. Therefore, experts believe that this is an alarming signal for the single currency, indicating a transition to the "negative" zone. In this situation, investors prefer selling the euro and the US dollar, which leads to a weakening of the EUR/USD pair.

The market is continuously being surprised by the incredible stability of the dollar and its ability to rise from the ground. Experts admit that it's time for another surprise from the US dollar, which is able to show its hidden potential.

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EURUSD. Central European Bank has designated the level of resistance

Yesterday's reaction to the bank level of 1.1883 indicates that growth is being held by placing large limit orders. There is a high probability of a decline to the support zone formed from the level of 1.1769. This model is a priority at the end of this week and the beginning of next week.

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This model will continue to form a medium-term accumulation zone. It is important to understand that sales must be recorded when testing the lower banking zone. This will help in avoiding missed opportunities.

If the test of the 1.1769 level leads to a large demand, then you will need to open purchases. The growth target will be a return to the level of 1.1883. This model is valid until next Wednesday which makes purchases profitable after a decline to 1.1769. Don't forget to fix your positions when you reach the support and resistance zones.

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GBPUSD. The Bank of England held the price at 1.3277

At the end of this week, the main trading direction might be a decline. This is possible since the Bank of England kept on accumulating limit orders above the level of 1.3277. The target of the downward movement is the banking zone with the support level of 1.3144. Upon reaching this zone, closing some of the sales is necessary.

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Working in the accumulation zone involves searching for sales at the level of 1.3277 and purchases from the level of 1.3144. This strategy will allow you to focus on finding favorable prices and give you the opportunity to gain an advantage over the distance due to a positive risk-to-profit ratio.

If today's close takes place above the level of 1.3277, then there will be an exit from the accumulation zone. Purchases will come to the fore at tomorrow's European session. Since this model has a lower probability, it can be used as an auxiliary model.

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Forecast for EUR/USD on November 19, 2020

EUR/USD

Yesterday, the euro fell to Tuesday's opening level, also trying to test the daily MACD line, and was unsuccessful at it. This morning the price touched the nearest support at 1.1830. The price must settle below this level in order to form a condition for it to decline further. The Marlin oscillator is moving to the downside, showing the price's intent to overcome the achieved support.

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Examining the situation on the four-hour chart fully reveals the importance of the moment. The Marlin oscillator is decreasing at a normal rate, not at an accelerated rate, as we mentioned yesterday, which creates the actual uncertainty of the price's current state in the range of 1.1816-1.1904. The lower border can even be shifted lower to 1.1816, where the MACD line runs.

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So, we are waiting for the price to settle below the MACD line, below 1.1816, afterwards the euro could fall to 1.1750. It is possible for the price to grow when it goes beyond the MACD line of the daily scale at 1.1904. The closest target will be 1.1940, getting the price to settle above the level opens the target range of 1.2010/40. The probability of such a scenario is 20%.

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Forecast for AUD/USD on November 19, 2020

AUD/USD

The Australian dollar traded with a range of 30 points yesterday, closing the day near the area where it opened. The price divergence continues to operate with the Marlin oscillator, support for the aussie is the MACD line on the daily chart at 0.7262. Overcoming support will pull down the price. The first target is the November 12 low at 0.7222. Getting the pair to settle below the level will open the way to 0.7120.

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Nevertheless, we formally have an ascending trend - the price is above the indicator lines, while Marlin is in the growth zone. Accordingly, the probability that the price will rise to 0.7380 is about 40-45%.

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The four-hour chart shows that the declining potential is stronger. The price breaks below the MACD line and the balance line. Getting the pair to settle below them will lead to a decisive attack to the MACD line (0.7262) on the daily scale, if successful, the nearest target at 0.7222 will open. The Marlin oscillator is trying to overcome the border of the bears' territory on the four-hour chart.

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Forecast for USD/JPY on November 19, 2020

USD/JPY

USD/JPY fell yesterday, which means, the yen strengthened by 0.38%, supported by the declining US stock market that was down 1.16%. The price broke support at 104.05, now it's aiming for the 103.18 level. Settling in the area under it opens the second target of 102.35. Marlin is declining in the negative zone, strengthening the downward potential.

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The four-hour chart shows that the price settled below the 104.05 level. The signal line of the Marlin oscillator has reached the upper boundary of its own channel; now it is likely to reverse to the downside, which will further strengthen the local downward trend. We are waiting for the price near the nearest target of 103.18.

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EUR/USD: the Euro has a negative factor

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Investors have moderated their fervor and global markets are already less receptive to General optimism about the vaccine and are moving away from previously achieved peaks. However, this does not help the dollar, which continues to weaken against the basket of competitors.

In addition to negative macroeconomic data, the degree of tension was raised by the speech of Federal reserve officials. Jerome Powell once again made it clear that difficult times are ahead and the US economy has a long way to go to recover. In addition, the Fed leadership spoke again about the need for new support measures. Although there were no hints of plans to strengthen support measures, markets are waiting for a decision to be made at one of the next meetings of the Federal reserve. Statements by regulatory officials on this issue may become an important support factor for stock markets, as the prospects for the adoption of fiscal measures by lawmakers remain uncertain.

It is unlikely that the decline in the dollar can now be explained by risk appetite. This is most likely the desire of market players to reduce the share of dollars.

Societe Generale believes that the driver of the fall in the dollar is now the collapse of the real yield of US Treasury bonds. This indicator sank after the Fed this year lowered interest rates and introduced stimulus measures in response to the pandemic.

According to the experts, "The high rate of infection in the United States raises strong concerns about the prospects for economic growth in the country. Even news about vaccines cannot compensate for these worries. Therefore, the dollar remains under pressure even though the stock market has reached a maximum. "

The dollar index barely reacted to the key support of 92.5, going below this value on Wednesday. If you look at the technical component, you can say that the dollar is now on the edge of the abyss and there is no reason to change the trend. The US currency index is trading at a 2-year low.

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The USD/JPY pair requires attention which is an important indicator of risk demand. Not so long ago, the rate dropped to 103.25, then went up on the expansion of the Bank of Japan's QE and the post-election rally. A week ago, the pair started a methodical decline and again fell below the 104 mark. Previously, this line was a key support level. It is interesting that the update of the highs of the US and Japan indices during the week took place at the time of the USD/JPY rate sagging.

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Moreoften, a steady rise in the yen is observed during a period of weakening markets or in extreme cases, precedes it. Interestingly, the Euro is now echoing the yen approaching its highs near the 1.19 mark against the dollar. This dynamic suggests some thoughts: perhaps the Euro has changed its status from a risky asset to a protective one.

The Euro is expected to continue to recover but not so quickly. Optimism about vaccines is being held back by the spread of the coronavirus. In addition, the decline in the dollar will be restrained. This should keep the EUR/USD pair below 1.19.

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However, given the local uptrend and the weakness of the sellers of the main Forex pair, a breakdown of the 1.19 mark is not excluded. This will be a clear bullish signal.

The excess of dollars in the financial system favors the EUR/USD pair. However, we should not hope too much for the Euro's growth, as the ECB has again expanded the volume of asset purchases. This is a negative signal for the single currency, which will deter investors from active purchases.

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Overview of the GBP/USD pair. November 19. Negotiations on Brexit: there is no good news. The most important trump card of

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - sideways.

Lower linear regression channel: direction - upward.

Moving average (20; smoothed) - upward.

CCI: 132.4724

The British pound sterling paired with the US dollar continued to rise in price for most of Wednesday, November 18, and eventually worked out the Murray level of "6/8"-1.3306, which is the previous local maximum. Thus, the upward trend in the pound sterling remains, although there is still no reason for this. We are referring to real fundamentals, not the hopes and optimism of traders regarding a trade deal between the UK and the EU. Thus, contrary to the fundamental background and common sense, the British pound may continue to rise in price in the coming days and even weeks. We have repeatedly said that any fundamental hypothesis must be confirmed by technical signals. So far, this is not the case. Thus, it is still recommended to trade for an increase.

Meanwhile, there is still no positive news from the Brexit trade deal negotiations. The groups of Michel Barnier and David Frost continue to negotiate, but do not share any important information with the markets. Moreover, Michel Barnier will not report to EU ambassadors on progress in negotiations until the EU summit on Thursday. He usually did this on Wednesdays, and on Fridays, he held a briefing where he answered questions from journalists. Formally, the summit should focus on other issues, not Brexit. However, the trade deal and progress in the negotiations will necessarily be discussed by the heads of the European Union. In the meantime, the longer the negotiations continue, the less likely it is to reach a final agreement. Recall that it is important not just to reach an agreement, but also to have time to ratify this agreement before December 31, 2020. That is, to make sure that the British Parliament and the European Parliament approve this document. But all this takes a lot of time. Moreover, if one of the British parties or at least one of the EU countries is against the current version of the agreement, it can be blocked. You will need more time to make adjustments and to vote for the document again. And on the main issues between the parties, there are differences and it is unclear how much more time will be required to completely level them. Well, we have already talked about the prospects of the British economy for the next year many times. In short, they are extremely vague.

And with all this, the pound sterling continues to rise in price. The UK has a huge number of problems right now. Starting from epidemiological, ending with economic. And only the rather ambiguous situation in America allows the pound to stay afloat in the last six months. We understand that one currency cannot become cheaper or more expensive all the time. However, for any currency, a negative fundamental background may persist for a long time. And this currency is now the pound sterling. The US dollar has not had many problems in the past four years. Yes, President Trump did everything to reduce the demand for the US currency, and the currency itself became cheaper. He has repeatedly stated that he needs a "cheap" dollar to make it easier to service the huge US government debt and get more profit from exports. However, the economy has been growing for most of Trump's term, the unemployment rate has remained at an all-time low, the labor market has been strong, and the stock market has consistently set growth records. But in the UK, the last four years can be called the "Brexit era", which can not but harm the country's economy and the value of its national currency. So slowly but surely, the pound has been sinking all this time. In any case, the next year will be a difficult one for the British economy. Experts have long calculated and reported that whether there is a deal with the EU or not, the British economy will still lose billions of pounds due to the "divorce" with the European Union. The only question is how serious the losses will be. Thus, the exclusively British fundamental background should continue to put pressure on the pound.

If it were not for the American fundamental background and separately Donald Trump, the pound would most likely continue to fall at this time. However, the last six months are clearly under the auspices of the weakening of the US currency. First, there were "four types of crises" in the United States: epidemiological, social, economic, and political. They somehow managed to resolve economic and social problems. But the epidemiological one has worsened, and a possible constitutional one has been added to the political one. Traders understand that Trump will not just leave his post. And if he does, he may end up doing things that Biden and his team will have to deal with for years to come. Just before 2024, when Donald Trump wants to run for President again. The most interesting thing is that it is in the interests of Trump to maximize the deterioration of the situation in the United States. The worse the legacy Trump leaves behind, the worse the results will be for Joe Biden and Kamala Harris. Therefore, in the next four years, Trump can already criticize the new President and constantly point out his mistakes. That is what Joe Biden has been doing over the past year. Well, for America and the US dollar, this is the worst-case scenario. When the presidents (current and future) will continue to fight with each other and fight for power.

Thus, so far, the technical picture predicts the continued strengthening of the UK currency. And if so, it is recommended to trade for an increase. None of the linear regression channels are directed down. The price in the last two months likes to overcome the moving average, but each time it inevitably returns to the area above it. Thus, the upward trend continues. But, from our point of view, the pound can still fall at any moment. It looks too overbought in recent times. You need to be prepared for this option.

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The average volatility of the GBP/USD pair is currently 89 points per day. For the pound/dollar pair, this value is "average". On Thursday, November 19, therefore, we expect movement inside the channel, limited by the levels of 1.3197 and 1.3375. A reversal of the Heiken Ashi indicator downwards signals a new round of corrective movement.

Nearest support levels:

S1 – 1.3245

S2 – 1.3184

S3 – 1.3123

Nearest resistance levels:

R1 – 1.3306

R2 – 1.3367

R3 – 1.3428

Trading recommendations:

The GBP/USD pair continues to move slightly up on the 4-hour timeframe. Thus, today it is recommended to stay in long positions with targets of 1.3367 and 1.3428 until the Heiken Ashi indicator turns down. It is recommended to trade the pair down with targets of 1.3123 and 1.3062 if the price is fixed below the moving average line.

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Overview of the EUR/USD pair. November 19. US election: the clowning continues. Donald Trump fires the second senior official.

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - sideways.

Lower linear regression channel: direction - upward.

Moving average (20; smoothed) - upward.

CCI: 82.1472

The third trading day of the week for the EUR/USD pair was again fairly calm. During the day, the euro/dollar pair attempted to continue moving up, however, the efforts of buyers were reduced to nothing. Thus, we can say that most of the day, the quotes generally stood still or traded in a very narrow side channel. The technical picture now suggests that the upward trend continues, as the price continues to be located above the moving average line. At the same time, traders once again failed to withdraw the pair from the side channel of 1.1700-1.1900. On the approach to the upper line of this channel, the bulls' fuse began to dry up and so far everything looks as if a new round of downward movement will simply begin within the side channel. However, this is exactly the scenario we are waiting for. Traders still do not see any reason to continue serious purchases of the European currency, however, there are no reasons for serious purchases of the US currency now either.

If we try to understand the movement of the euro/dollar pair over the past three months from a fundamental point of view, we can conclude that market participants generally ignored all events during the specified period. The pair spent most of these three months between the levels of 1.1700 and 1.1900, so a long-term flat is on the face. A flat means that either no important news or events occurred during this time or all of them were ignored. In our humble opinion, there were so many events in 2020 that would have been enough for 5 ordinary years. And the last three months are no exception. What are the US elections and all the "near-election" events worth? Thus, there is a high probability that market participants simply ignore most of the news, events, and macroeconomic reports.

Even though the results of the US election are almost unambiguous and at this time no one doubts that Joe Biden won, Trump retains a theoretical chance of extending his term in the White House for another 4 years. We have already written in previous articles that everything is possible. So far, Trump and his team continue to challenge the election results in the states they lost. However, the results are not yet encouraging. Two states where the recount was carried out announced some inaccuracies, thanks to which Trump will get several thousand more votes than previously stated. However, even with these votes, the incumbent still lost in these states. So far, it is extremely difficult to understand what "2.7 million stolen votes" Trump was talking about?

However, a little later, the clowning began (or continued). Recall that a few days ago, we reported on the dismissal of the US Secretary of Defense, who previously refused to send the army to American cities to disperse demonstrators and protesters during the summer riots on racial grounds. Chris Krebs, Director of the US Cybersecurity Agency, was the next to leave, saying there was no evidence of election fraud. Chris Krebs didn't see the fraud and Donald Trump did. Thus, Chris Krebs is fired. Here is simple logic. Earlier, the agency said that the past election was one of the safest in history. "Chris Krebs' recent statement about the security of the 2020 election was highly inaccurate, as there were massive violations and fraud, " Trump wrote on Twitter, as usual, without providing any proof of his words. To be honest, sometimes when we analyze news related to Trump, it seems that we are in a circus or some kind of humorous program. The President of the country with the largest economy in the world makes incompetent, false, and unconfirmed statements every day in the amount of at least 15 (these are statistics). At the same time, most of his statements look simply absurd and you don't need to be a political scientist to see this absurdity. But at the same time, Trump continues to make such statements and it is unclear what he is counting on. By and large, Trump can now disperse half of the White House altogether. All those who did not obey him, contradicted, refuted his words, and generally did not hold the same opinion as to the President. The most striking example is Anthony Fauci, who from the very beginning warned of the greatest danger of the "coronavirus" for Americans, while Trump said that "the virus will disappear by itself" and "it is no worse than a cold or flu". Fauci (like many other doctors and epidemiologists) refuted the President's words, so he may also lose his position in the near future.

Well, Trump can continue to take revenge on all those who are guilty of his defeat in the election. And the main culprit, of course, is China. In fact, in the near future, Washington may impose new sanctions against Chinese officials, as well as new trade duties on imports from China. Reasons? You don't need a reason. China does not want to make concessions and trade the way Washington wants, so sanctions. That's the whole logic of the current White House. One thing is certain. We are waiting for a very fun last month and a half of 2020 and the last 10 weeks of Trump as President of America.

Well, the US currency, which had a hard time in the last 7-8 months, will have to endure further. Demand for the US dollar in the foreign exchange market is not high right now, as it is completely unclear what to expect from Trump in the next few weeks and months. Many experts fear that Trump will finally slam the door, so much so that the echo will be heard all over the world. Thus, we believe that the best scenario for the US currency for the next couple of months is a movement on the same side-channel of 1.17-1.19. If traders manage to move the pair above the 1.1900 level, the chances of forming a new upward trend (or resuming the old one) will increase significantly.

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The volatility of the euro/dollar currency pair as of November 19 is 50 points and is characterized as "average". Thus, we expect the pair to move today between the levels of 1.1820 and 1.1920. A reversal of the Heiken Ashi indicator upward may signal a new round of upward movement.

Nearest support levels:

S1 – 1.1841

S2 – 1.1780

S3 – 1.1719

Nearest resistance levels:

R1 – 1.1902

R2 – 1.1963

R3 – 1.2024

Trading recommendations:

The EUR/USD pair has started a new round of correction but remains above the moving average. Thus, today it is recommended to open new long positions with targets of 1.1902 and 1.1920 if the Heiken Ashi indicator turns up. It is recommended to consider sell orders if the pair is fixed below the moving average with the first target of 1.1780.

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