Dollar Stays Weak Against Peers

Trading 26 Nov 2020 Commentaire »

The U.S. dollar was weak against most of its peers on Wednesday, reacting to recent updates on potential coronavirus vaccine and the latest batch of economic data.

According to data released by the Labor Department, first-time claims for U.S. unemployment benefits unexpectedly increased in the week ended November 21st, climbing to 778,000, an increase of 30,000 from the previous week's revised level of 748,000. Economists had expected jobless claims to drop to 730,000 from the 742,000 originally reported for the previous week.

A report from the Commerce Department said durable goods orders jumped by 1.3% in October after spiking by 2.1% in September. Economists had expected durable goods orders to climb by 0.9%.

Another report from the Commerce Department showed the spike in gross domestic product in the third quarter was 33.1%, unrevised from the initial estimate.

Personal income in the U.S. fell by 0.7% in October after climbing by a downwardly revised 0.7% in September. Meanwhile, the report said personal spending rose by 0.5% in October after jumping by a revised 1.2% in September.

Yet another report from the same department said new home sales in the U.S. unexpectedly dipped by 0.3% to an annual rate of 999,000 in October after inching up by 0.1% to a revised rate of 1.002 million in September.

Revised data released by the University of Michigan on Wednesday showed consumer sentiment in the U.S. deteriorated by slightly more than expected in the month of November, with the index coming in at 76.9 down from a preliminary reading of 77.0.

The dollar index, which fell to a low of 91.93 in the European session, continues to trade weak despite making a couple of attempts to pare losses. At 91.99, the dollar index is now down 0.25% from previous close.

Against the Euro, the dollar weakened to $1.1914, despite firming up to $1.1883 in the Asian session.

The Pound Sterling is stronger by 0.15%, fetching $1.3383 a unit, compared to $1.3363 on Tuesday.

The Yen is little changed at 104.47 a dollar.

The Aussie is roughly flat against the greenback, with the AUD-USD pair quoting at 0.7365.

The Swiss franc is up at 0.9085 a dollar, more than 0.3% up from its previous close of 0.9113, while the Loonie is at 1.3008 a dollar, down from 1.2998.


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

Overview of the GBP/USD pair. November 26. Nothing can replace the $ 900 billion agreement with the European Union. The British

Trading 26 Nov 2020 Commentaire »

4-hour timeframe

analytics5fbef193d4bde.jpg

Technical details:

Higher linear regression channel: direction - upward.

Lower linear regression channel: direction - upward.

Moving average (20; smoothed) - upward.

CCI: 116.1402

The situation is even more fun with the British pound. We have repeatedly said that there is no reason for the British currency to strengthen against the US dollar. If the European economy shrank by 11% in the second quarter due to the pandemic, the British economy - by more than 20%, and in the third quarter – showed a rather weak recovery. Therefore, if the strengthening of the euro currency after the spring fall can still be justified fundamentally, then the strengthening of the British pound is not. And the most important thing is that the euro currency has not been growing in the last four months, and the pound has already added almost 20 cents since the spring. Based on what, if no positive messages come from the UK? One might assume that the problem lies in America and the weakness of the US currency. However, no disappointing news has been coming from America lately either. Moreover, both the British and European economies were quarantined at the end of 2020, unlike the American one. That is, in the fourth quarter, traders will be entitled to expect a reduction in the GDP of Britain and the EU, but the US GDP should continue to recover from the crisis. Indirectly, this assumption has already been confirmed by the indices of business activity in the services sector for November. In the UK, Germany and the EU fell below 50.0, while in the United States, on the contrary, they rose. Thus, why the US currency is falling is one of the main mysteries of the second half of 2020.

The most important thing is that the British economy is already in a serious crisis, all government actions are ineffective and questionable in the long term. There was no trade agreement with the European Union. All attempts by the British government to offset the possible damage from the lack of a deal with Brussels with trade agreements with other countries cause only bitter laughter. Andrew Bailey has been sounding the alarm for several months and says that the lack of an agreement with the EU is much worse than the "coronavirus" pandemic. UK businesses continue to leave the Foggy Albion, and those who cannot do so are already begging Boris Johnson to sign an agreement with the EU. These are the realities in which the pound continues to grow.

During 2020, it became known that the UK has concluded two trade agreements. With Canada (temporary) for $ 27 billion and with Japan for $ 1.5 billion. Now pay attention. The total trade turnover with the European Union is 900 billion dollars. The losses to Britain's car industry alone will amount to hundreds of billions of dollars if there is no agreement. Thus, trade deals with Canada and Japan look as simple as signing an agreement for the supply of two bags of potatoes. They will not be of serious significance to the British economy.

Meanwhile, the parties are still trying to find solutions to the most complex and controversial issues, however, they also continue to say that they are ready for a "hard" Brexit if anything happens. This is regularly stated by representatives of the European Union, these words, like a mantra, are constantly repeated by Boris Johnson. Each side is afraid to show that the trade agreement is really important to them, because in this case, the other side may demand more concessions. However, the fact remains that the 900-billion agreement is necessary for both the first and the second. Yes, the impact on the European economy will be smaller in percentage terms. However, it is unlikely that the EU wants to lose several hundred billion dollars. European Commission President Ursula von der Leyen said: "The next few days will be crucial in the negotiations. But I still can't say if there will be an agreement. The EU is well prepared for a "no-deal" scenario, but we prefer "with a deal". I have complete confidence in Michel Barnier. However, whatever the outcome, there must and will be a clear difference between full membership in the EU and the status of just a respected partner." But then Ms. von der Leyen "pleased" traders with a list of issues where serious differences remain. And the list was much broader than many media outlets had imagined in recent weeks. In addition to the issues of fishing, fair competition, and dispute resolution in the courts, von der Leyen also called issues of state aid, labor market standards and social rights, environmental protection, and climate change issues where there is a lack of full understanding. Thus, how the delegations of Michel Barnier and David Frost are going to agree on such a huge number of issues within a few days, and even in video mode, is completely unclear.

And almost immediately after this speech, the head of the European Commission commented on the chief negotiator from the EU, Michel Barnier, who said that if London does not make concessions within the next 48 hours, the European Union will withdraw from the negotiations this week. I don't know if it's just this week or not at all. Thus, the British economy and the pound have been walking on the edge of a precipice in recent months. They have been walking for quite a long time and holding the handle. If one of them falls, the other one will also be dragged down. And most importantly. We have listed a bunch of different speeches, messages from people who have a huge impact on the negotiation process, on the economy of the EU and the UK. And there was not a single message or news that suggested a deal was possible and that Britain's economy would not collapse in 2021. In other words, there is no positive news in principle. Nevertheless, the pound continues to grow steadily.

Based on all of the above, we can only draw one conclusion. Sooner or later, the pound will still start to fall. It is better to be prepared for this. The British currency already looks quite overbought. And when we begin to analyze the reasons for its growth, it generally becomes unclear why market participants continue to buy this currency. However, as we have said many times, the fundamental background can be anything, including the current one, but if traders do not trade according to it, it is meaningless. Therefore, in any case, to expect a fall in the pound and work it out, we need technical grounds to assume such a scenario.

analytics5fbef19cb5eea.jpg

The average volatility of the GBP/USD pair is currently 88 points per day. For the pound/dollar pair, this value is "average". On Thursday, November 26, thus, we expect movement inside the channel, limited by the levels of 1.3290 and 1.3466. A reversal of the Heiken Ashi indicator downwards signals a round of corrective movement.

Nearest support levels:

S1 – 1.3367

S2 – 1.3306

S3 – 1.3245

Nearest resistance levels:

R1 – 1.3428

R2 – 1.3489

R3 – 1.3550

Trading recommendations:

The GBP/USD pair is trying to resume its upward movement on the 4-hour timeframe. Thus, today it is recommended to keep open long positions with targets of 1.3428 and 1.3466 until the Heiken Ashi indicator turns down. It is recommended to trade the pair down with targets of 1.3245 and 1.3184 if the price is fixed below the moving average line.

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

Overview of the EUR/USD pair. November 26. Markets have finally lost their bearings. The European and American economies

Trading 26 Nov 2020 Commentaire »

4-hour timeframe

analytics5fbef1511a9fb.jpg

Technical details:

Higher linear regression channel: direction - sideways.

Lower linear regression channel: direction - upward.

Moving average (20; smoothed) - upward.

CCI: 163.7550

The third trading day for the EUR/USD pair was again held in fairly calm trading, without any sudden movements. The volatility was average, even closer to a low value, about 50 points. Thus, it is impossible to say that on this day the markets reacted desperately to macroeconomic statistics or tracked the fundamental background all day. Moreover, the technical picture remains very simple, however, the way the pair has been moving in the last couple of weeks is already causing concern. If in the last 3-4 months the quotes were mostly traded in the range between 1.1700 and 1.1900, then in the last two weeks they spent exactly under the upper line of this channel, moving along this level. In other words, we got a flat inside a flat. Trading in such conditions is even more difficult than just in a side channel. By and large, we are witnessing market noise. Yesterday's auction was completely beyond comprehension. The price bitterly broke the 1.1900 level and traded along the level of 1.1910 (approximately) all day. In other words, overcoming the upper limit of the side channel, in which the euro/dollar pair spent four months, led to an increase of 10 points and a flat within 20-24 hours. Further, the quotes could not move up or start falling (in case the breakout was false). As a result, we have a pair that is fixed 10 points above the side channel, and what to do with it is unclear. The "linear regression channels" system formally indicates an upward trend. The last bars are colored purple, but the quotes really could not even overcome the Murray level of "3/8"-1.1902, trading again near it. Thus, in the current situation, traders should be advised to just wait. Wait for the situation to become completely clear.

I don't want to talk about the fundamental background either. A pair that has been standing almost in one place for four months (in the long term), refusing to respond to really important events, now does not give any reason to assume that it will work out any indicator of GDP. By and large, traders continue to ignore all the news, as if showing that the current fundamental background is such that the pair will remain in the $1.17-$1.19 channel for another six months. Briefly about the latest important topics for the euro and the dollar.

1) Hungary, Poland, and Slovenia blocked the adoption of the EU budget for 2021-2027 and the fund for economic recovery after the pandemic. Poland and Hungary are accused of violating the democratic principle and trying to establish a totalitarian regime in some areas of the country's life (be it the courts or television). The EU, on the other hand, wants the rule of law to be respected and can simply cut the allocation of budget funds to those EU members who, in its opinion, violate this rule. However, this is politics. Nothing is unambiguous here. How, for example, is the EU going to prove that the parties of Poland and Hungary violate the principles of the rule of law? The EU will not sue these countries in court. And if so, in which one? To the European? Which of course implies that the side of the European authorities will be accepted. Formally, the EU can exclude these countries from financing altogether. However, this will mean a split of the entire European Union. All participating countries will understand that at any moment they can be "thrown out on the street" and the integrity of the Alliance can be seriously shaken. So, naturally, the parties will try to reach an agreement. And to do this, you need to guarantee the troublemaking countries funding from the funds listed above. In general, this issue can be resolved for a long time, although the parties also have time.

2) America. The election is over, and the process of transferring power to Joe Biden has begun. former Fed chair Janet Yellen may become the new Finance Minister. Donald Trump does not recognize the election results and continues to bombard all US courts with lawsuits. At the same time, his actions have not yet led to the desired revision of the voting results in any state. Thus, now, probably, it is already possible to say with 100% confidence that Joe Biden will be President, and all Trump's attempts to seize power from the Democrat failed. Trump will be remembered by the States and the world for a long time and will stand at the end of the list of failed presidents who failed to get re-elected for a second term. Trump himself in recent speeches spoke about the "coronavirus", the vaccine, and the Dow Jones index, which, despite the pandemic, broke the record. However, most Americans are not very interested in the Dow Jones index. They are more interested in when the coronavirus vaccine will be available and how much it will cost. Trump promised that the vaccine will be available next week and, of course, again lied. First, the vaccine is unlikely to be available next week. Secondly, according to doctors around the world, to defeat the COVID-2019 epidemic, it is necessary that a large part of the world's population either get sick with this virus or get vaccinated. Can you imagine how long it will take to vaccinate even 70% of the US population? How long will it take to create such a huge number of doses? Plus, it is unlikely that this vaccine will simply be available in all pharmacies. Most likely, it will be distributed in a special way and will be a deficit in the first months. Thus, even if the first vaccination with a new vaccine takes place in America tomorrow, this does not mean that the pandemic is over. In the United States, meanwhile, 170,000 to 180,000 new cases are reported every day.

3) Performances by Christine Lagarde and Jerome Powell. They took place last week, but the main thing is that both heads of central banks urged to prepare for the worst. According to Lagarde and Powell, both economies will experience problems in the winter, they need additional funding, which is not available (in the EU, the seven-year budget and the recovery fund are blocked, in America, the Democrats and Republicans have not agreed on a new package of assistance to the economy). Lagarde called on the European Commission to resolve problems with Poland and Hungary as quickly as possible, and also announced an increase in the asset purchase program in December. Powell has not announced anything yet, and the US has not had a second "lockdown", so the US economy may experience fewer problems than the European one.

analytics5fbef15b4f67f.jpg

The volatility of the euro/dollar currency pair as of November 26 is 60 points and is characterized as "average". Thus, we expect the pair to move today between the levels of 1.1859 and 1.1979. A downward reversal of the Heiken Ashi indicator may signal a downward correction.

Nearest support levels:

S1 – 1.1902

S2 – 1.1841

S3 – 1.1780

Nearest resistance levels:

R1 – 1.1963

R2 – 1.2024

R3 – 1.2085

Trading recommendations:

The EUR/USD pair continues to be located above the moving average line. Thus, today it is recommended to stay in long positions with targets of 1.1963 and 1.1979 until the Heiken Ashi indicator turns down. It is recommended to consider sell orders if the pair is fixed below the moving average with the first targets of 1.1841 and 1.1780.

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

Who is Yellen for the dollar—a lifeline or a deep abyss?

Trading 26 Nov 2020 Commentaire »

analytics5fbe9cbb7136e.jpg

On Wednesday, the US dollar tried to keep from falling, but to no avail. In the American session, it went down again and broke the 92 mark. The dollar index is approaching a dangerous edge. If sellers manage to push it to the value of 91.75, an important long-term technical support level, then it will be followed by a sharp and rapid decline. It is worth considering that the next long-term support level is the 2018 low at 88.25.

analytics5fbe9bec8c7b7.jpg

The dollar is taking losses as progress in developing new vaccines and expectations of fiscal stimulus in the US instill risk appetite in investors. The dollar is expected to continue to fall also because former Fed Chair Janet Yellen may become the next US Treasury Secretary. Thus, markets welcome a return to stability.

As for the future prospects, the election of Joe Biden as President and the possible appointment of Yellen as head of the Financial Department can play into the hands of the US currency. If the Trump team created chaos around the dollar, the new government's policy towards the dollar is expected to be more predictable and positive. From Clinton to Obama, the authorities held the position of a strong dollar, considering it as a reflection of the strength of the country's economy. Donald Trump has repeatedly threatened to intervene against the strengthening dollar, and took the opposite position after a while.

analytics5fbe9bfdc7169.jpg

Janet Yellen must restore clarity on dollar policy and stabilize the currency market. But first, the future Secretary of the Treasury and the new President of the United States will need time to fight the pandemic and repair the economic damage from it.

The Minister of Finance has traditionally been responsible for dollar policy. But under Trump, that framework has been erased. In addition, the administration has shown less commitment to a strong dollar because of the President's obsession with the US trade deficit.

Former Treasury Secretary Larry Summers states that it's time for the country to return to the traditional policy of a strong dollar.

Note that any changes in the currency policy will occur when the markets increase the opinion that the dollar is entering a long phase of decline.

The dollar index fell more than 11%. Bears on the dollar were encouraged by expectations that the Fed will keep rates near zero for many years. In addition, the demand for greenback will weaken, considering the strong results of testing of coronavirus vaccines.

According to strategists at Standard Bank, "Considering the dollar further falling during the Biden presidency, the issue of US monetary policy will be important. Moreover, the era of almost complete absence of currency intervention by developed countries may also end soon."

The trend of low rates may continue, I must say. Yellen praised the policy of the current head of the Regulator, Jerome Powell, which provides for a long period of low rates while expanding government spending.

analytics5fbe9c1a675ae.jpg

Traders await decisive action against the dollar. However, not everyone agrees that Janet Yellen will make strong statements about currency policy, since attention will be focused on the internal problems of the economy – this is more important at the moment.

Be that as it may, the former head of the Fed can stop the loss of confidence in the reserve currency. She will turn to the "old Rubin doctrine", according to which a strong dollar is in the interests of the United States. The financier can repeat the G7 promise that exchange rates should be determined by the market. She will be able to find a way out of the situation and stop the loss of world domination by the dollar. Yellen is able to cheer up the markets and end the confusion around the US national currency.

Experts at Commerzbank believe that "Yellen really is a balm for the souls of all those who suffered as a result of the chaotic dollar policy of the previous government over the past four years."

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

NZD/USD. The New Zealander is eager to fight: purchasing is still relevant

Trading 26 Nov 2020 Commentaire »

The New Zealand Dollar paired with the US currency continues to update price highs. For the second day, the NZD/USD pair is testing the 70th figure. The last time NZD was at such price heights was almost two and a half years ago in June 2018. It is noteworthy that the pair is growing not only because of the greenback's weakness but because the New Zealander received indirect but quite powerful (and unexpected) support from the New Zealand government yesterday. All other fundamental factors are also positive for NZD/USD pair, starting from the intentions of the New Zealand regulator, ending with the situation with the Coronavirus in the country.

During yesterday's Asian session, the New Zealand Finance Minister announced that his department's plans to include the issue of housing price stability in the list of responsibilities of the New Zealand regulator. But, given the fact that the country's Central Bank is an independent body, the Ministry of Finance has so far only sent relevant proposals (recommendations) to the Central Bank. If the Reserve Bank agrees to this proposal, when determining the course of monetary policy in the future, it will have to take this factor into account.

analytics5fbe9ad916ed5.jpg

It is worth recalling that not so long ago, in the spring of last year, the Reserve Bank of New Zealand introduced a double mandate. Since then, the Central Bank has not only provided employment but is also responsible for price stability. Although the Finance Minister assured journalists that in this case we are not talking about changing the mandate, the de facto Central Bank will take into account the situation in the real estate market, which in turn does not contribute to a further reduction in the interest rate.

Actually, for this reason, the New Zealand Dollar soared up, having received another reason for the upward movement. For example, during the year of the pandemic, the cost per square meter in Auckland (the largest city of the island state) increased by 13%. New Zealand is considered a kind of safe haven being one of the few countries in the world that has defeated the coronavirus. Now, only isolated cases are registered, mainly during the quarantine period after arriving from abroad. This is also the reason why there is a stable high demand for housing in the country's largest cities, both from local buyers and from foreign investors. Virtually uncontrolled real estate price inflation has already become a political problem. The reduction in the interest rate amid the Coronavirus crisis has led to a decrease in the cost of borrowing and as a result, to another wave of demand for housing. Therefore, it is not surprising that the government wants to actually change the mandate of the RBNZ although the Bank formally denies this: now, when making decisions, the Central Bank will also take into account the situation on the real estate market.

analytics5fbe9acac0715.jpg

According to many experts, the likely consequence of such innovations may be an increase in the RBNZ interest rate at the beginning of next year. Although it is impossible to say this with certainty, it is worth recalling that a few months ago, the market seriously discussed the probability of a rate cut in the negative area. At the moment, this option can be excluded from the list of probable ones. At a minimum, the rate will remain at the current level, and at a maximum, it will be increased in the first half of 2021.

This fundamental background allows buyers of the NZD/USD pair to open new price horizons. Other fundamental factors also speak in favor of an upward movement. These include the growth of the dairy index, the growth of Chinese data, and, in the end, the victory over the Coronavirus. All this suggests that the New Zealand Dollar has not exhausted its potential, which means that any corrective pullback can be used to open longs.

From the point of view of technical analysis, the situation is as follows. On all higher timeframes (including the monthly chart). The pair is on the upper line of the Bollinger Bands indicator and above all the lines of the Ichimoku indicator (except MN). The upper boundary of the Kumo cloud, which corresponds to 0.7060, is the resistance level (the goal of the upward movement).

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

Treasuries Close Nearly Unchanged Following Slew Of Economic Data

Trading 26 Nov 2020 Commentaire »

Treasuries saw modest strength for much of the trading day on Wednesday but ended the session nearly unchanged.

Bond prices pulled back near the unchanged line going into the close. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by less than a basis point to 0.878 percent.

The roughly flat close by treasuries came following the release of a slew of U.S. economic data, with a report from the Labor Department showing fist-time claims for U.S. unemployment benefits unexpectedly increased in the week ended November 21st.

The report said initial jobless claims climbed to 778,000, an increase of 30,000 from the previous week's revised level of 748,000.

The increase surprised economists, who had expected jobless claims to drop to 730,000 from the 742,000 originally reported for the previous week.

Meanwhile, new orders for U.S. manufactured durable goods increased by more than expected in the month of October, the Commerce Department revealed in a report.

The Commerce Department said durable goods orders jumped by 1.3 percent in October after spiking by 2.1 percent in September. Economists had expected durable goods orders to climb by 0.9 percent.

Excluding an increase in orders for transportation equipment, durable goods orders still surged up by 1.3 percent in October after jumping by 1.5 percent in September. Ex-transportation orders were expected to rise by 0.4 percent.

A separate report released by the Commerce Department showed the spike in gross domestic product in the third quarter was unrevised from the initial estimate.

The Commerce Department said GDP skyrocketed by an annual rate of 33.1 percent in the third quarter after plunging by 31.4 percent in the second quarter. The unrevised reading on GDP matched economist estimates.

Another report from the Commerce Department showed new home sales in the U.S. unexpectedly edged lower in the month of October.

The Commerce Department said new home sales dipped by 0.3 percent to an annual rate of 999,000 in October after inching up by 0.1 percent to a revised rate of 1.002 million in September.

Economists had expected new home sales to jump by 1.1 percent to a rate of 970,000 from the 959,000 originally reported for the previous month.

The Commerce Department also released a report showing a decrease in U.S. personal income in the month of October.

The report said personal income fell by 0.7 percent in October after climbing by a downwardly revised 0.7 percent in September.

Economists had expected personal income to come in unchanged compared to the 0.9 percent increase originally reported for the previous month.

Following the Thanksgiving Day holiday on Thursday, trading activity may be subdued on Friday amid a lack of major U.S. economic data and an early close for the markets.


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

Crude Oil Futures Settle Sharply Higher Again

Trading 26 Nov 2020 Commentaire »

Crude oil prices moved higher on Wednesday, extending recent gains, and posted an over 8-month high after data showed a fall in U.S. stockpiles last week.

Continued optimism about coronavirus vaccine and a likely pick-up in energy demand further supported oil's uptick.

The market ignored a report showing a marked increase in the number of oil-rigs in the U.S. this week. According to Baker Hughes, the number of U.S. oil rigs rose by 10 to 241 this week.

Usually, the Baker Hughes report arrives on Friday. However, this week, the data has been released due to the upcoming Thanksgiving Day holiday.

West Texas Intermediate Crude oil futures for January ended up $0.80 or about 1.8% at $45.71 a barrel. Prices rose to a high of $46.26 in the session.

WTI crude futures for January ended with a gain of $1.85 or about 4.3% at $44.91 a barrel on Tuesday.

Brent crude futures were up by about 1% or &0.48 at $48.34 a barrel.

Data released by the Energy Information Administration (EIA) shoed crude inventories in the U.S. dropped by 754,000 barrels last week, as against expectations for an increase of about 127,000 barrels.

The EIA data also showed that inventories at Cushing, Oklahoma, declined by 1.7 million barrels last week.

Traders were also betting on hopes the OPEC and allies will consider extending their output curbs for another few months.


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

Gold Futures Settle Slightly Up

Trading 26 Nov 2020 Commentaire »

Gold futures ended slightly up on Wednesday after moving in a tight band as traders continued to track news about coronavirus cases and digest recent updates on potential Covid-19 vaccines.

The developments on the political front where the President-elect Joe Biden is set to move into the White House were eyed as well.

Traders, digesting a slew of economic data released today, were also looking ahead to the release of Federal Reserve's latest monetary policy meeting.

A weak dollar amid prospects for a stimulus plan supported the yellow metal a bit.

The dollar index, which dropped down to 91.93, recovered some lost ground, but was still down 0.2% at 92.05.

Gold futures for December ended up $0.90 at $1,805.50 an ounce, after moving between $1,79860 and $1,816,30 in the session.

Silver futures for December ended higher by $0.062 at $23.362 an ounce, while Copper futures for December settled at $3.3095 per pound, gaining $0.0100.

According to data released by the Labor Department, first-time claims for U.S. unemployment benefits unexpectedly increased in the week ended November 21st, climbing to 778,000, an increase of 30,000 from the previous week's revised level of 748,000. Economists had expected jobless claims to drop to 730,000 from the 742,000 originally reported for the previous week.

A report from the Commerce Department said durable goods orders jumped by 1.3% in October after spiking by 2.1% in September. Economists had expected durable goods orders to climb by 0.9%.

Another report from the Commerce Department showed the spike in gross domestic product in the third quarter was 33.1%, unrevised from the initial estimate.

Personal income in the U.S. fell by 0.7% in October after climbing by a downwardly revised 0.7% in September. Economists had expected personal income to come in unchanged compared to the 0.9% increase originally reported for the previous month.

Meanwhile, the report said personal spending rose by 0.5% in October after jumping by a revised 1.2% in September.

Yet another report from the same department said new home sales in the U.S. unexpectedly dipped by 0.3% to an annual rate of 999,000 in October after inching up by 0.1% to a revised rate of 1.002 million in September.

Revised data released by the University of Michigan on Wednesday showed consumer sentiment in the U.S. deteriorated by slightly more than expected in the month of November, with the index coming in at 76.9 down from a preliminary reading of 77.0.


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

*Federal Reserve Releases Minutes Of November Monetary Policy Meeting

Trading 26 Nov 2020 Commentaire »

Federal Reserve Releases Minutes Of November Monetary Policy Meeting


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

Forecast and trading signals for GBP/USD on November 26. COT report. Analysis of Wednesday. Recommendations for Thursday

Trading 25 Nov 2020 Commentaire »

GBPUSD 1H

The GBP/USD pair moved identically to the EUR/USD pair by moving in different directions on Wednesday, November 25. It resulted in the price rebounding from the lower line of the rising channel. Yes, the pound is facing an upward trend, in contrast to the euro. Accordingly, buyers continue to hold the initiative in their hands and the chances of sustaining the upward movement remain very good, from a purely technical point of view. The fundamental background is another matter. We have analyzed in previous articles that the pound does not have any fundamental support now. Moreover, if we take all the news from Great Britain over the past months into account, it becomes clear that the pound should, rather, have become cheaper. However, this is not the case. The pound continues to rise and does so almost every day. In total, this currency has risen in price by almost 20 cents since March. But as long as the price is within the rising channel and above the critical line, all our assumptions based on the foundation remain only assumptions and hypotheses.

GBPUSD 15M

analytics5fbeb8c4919f4.jpg

Both linear regression channels turned sideways on the 15-minute timeframe, which perfectly reflects the nature of trading in the last two days. If a clear upward trend persists in the long term, then it would be very difficult for the pound/dollar pair to overcome its local highs. Maybe this is the beginning of the end? The end of the upward trend?

COT report

analytics5fbeb8d202213.jpg

The GBP/USD pair rose by 25 points in the last reporting week (November 10-16), although the volatility was quite high during this time period. However, the Commitment of Traders (COT) report has not provided us with any important information that could help in forecasting and trading for several weeks now. Recall that the red and green lines must move away from each other or sharply change the direction of their movement, so that we can conclude that one trend ends and another begins. In recent months, both lines regularly change their direction, which indicates the absence of signals based on COT reports. What can we say about the most important group of non-commercial traders? This group opened 533 contracts to buy the pound and 616 contracts to sell during the reporting week. Therefore, it doesn't even make any special sense to calculate the change in the net position or the amount by which the attitude of professional traders has changed. A little more than 1000 contracts per week is very little. Therefore, in essence, there are no changes. What do we end up with? There are no changes, and the general picture of things does not make it possible to predict any definite development of the situation. So now it is better to pay more attention to technique and foundation.

The fundamentals for the British pound were rather weak on Wednesday, considering the news from the UK. In the next article, we will look at all aspects of Britain's fundamental background. It is already obvious that it's negative. In addition to the report on orders for durable goods, America also published reports on GDP for the third quarter, the number of applications for unemployment benefits, as well as changes in personal income and spending of US citizens. The first figure stood at 33.1% q/q, as expected, as published in the previous two estimates. The number of initial applications for benefits was higher than analysts expected, which is not surprising given the scale of the coronavirus pandemic in the United States. The third indicator was insignificant in the current environment. And so the most important reports on GDP and durable goods orders did not support the dollar, but did not also create additional pressure on this currency.

No major events or macroeconomic reports from the UK and the United States for today. The key factor for the pair is also technical. The rising channel keeps traders bullish and that says it all. There is a fairly high probability that Brexit trade talks will fail again this week. At least Michel Barnier warned his colleague David Frost that if there are no concessions, he will withdraw from the negotiations. Will this exit mean that the negotiations will fail completely? It is unlikely that the parties have time for ultimatums to each other and for reflection...

We have two trading ideas for November 26:

1) Buyers for the pound/dollar pair continue to hold the initiative in their hands and did not let the price go below the Kijun-sen line (1.3295) and the rising channel. Thus, we advise you to trade upwards while aiming for the resistance levels of 1.3397 and 1.3483 as long as the price is within the rising channel and above the critical line. Take Profit in this case will be up to 90 points.

2) Sellers failed to go below the critical line yesterday. If the price settles below the Kijun-sen line (1.3295) and below the rising channel, you are advised to sell the pound/dollar pair while aiming for the Senkou Span B line (1.3208). Take Profit in this case can be up to 70 points.

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