BITCOIN Analysis for February 1, 2019

Trading 01 fév 2019 Commentaire »

Bitcoin has been quite indecisive and volatile below $3,500. The price dipped below $3,400 recently but managed to push higher in the process. The price is currently residing inside the Kumo Cloud resistance and below 200 EMA dynamic resistance as well. The volatility is still quite strong. After the recent swings, the price is proceeding higher with strong bullish pressures after every corrective bearish momentum. BTC is expected to retest $3,500 again in the coming days. If the price manages to break above $3,500 area with a daily close, BTC is likely to extend bullish pressure with a target towards $4,000.

SUPPORT: 3,000, 3,250

RESISTANCE: 3,500, 3,600, 4,000

BIAS: BULLISH

MOMENTUM: VOLATILE

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GBP: hope for a "soft" Brexit remains but declines every day

Trading 01 fév 2019 Commentaire »

While some experts point to the growing risk of UK withdrawal from the EU without a deal and believe that the pound's collapse is just a matter of time, others believe that London will try to postpone Brexit instead, from which the British currency will benefit.

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In particular, the specialists of Deutsche Bank, who previously recommended to take the "longs" in the British currency, now hold a neutral position.

"We believe that Malthouse compromise has almost zero chance of success in the European Union", they said.

According to experts at Nordea Bank, the vote, which took place in the House of Commons last Tuesday, pushed the United Kingdom closer to a controlled exit without a deal.

"We do not share the optimism of investors about Brexit and in their place would not be so careless about the threat of lack of agreement," said representatives of the financial institute.

They advised selling the pound against the euro with a target of 89.50.

"The psychological game between Britain and the EU seems to have entered a crucial phase this Tuesday. At the moment this does not seem to be taken into account by the markets in prices. However, the main question is whether the deal is possible in principle, given the fact that there are still important differences between Brussels and London. Most likely, the pound will return the newly scored points against the euro and the dollar and go to levels of € 0.89 and $ 1.29, that is, where the last "British" rally began, "said analysts at Credit Agricole.

In turn, UniCredit currency strategists maintain a positive attitude towards sterling and expect a revival of interest in currency purchases closer to February 13 if the British parliament will hold a second vote on the divorce agreement.

"We proceed from the fact that chaotic Brexit or exit without a deal can still be avoided," they said.

"In our opinion, an extension of the term of Article 50 of the Lisbon Treaty may be required, even if eventually the parties reach an agreement. A pound may strengthen against the Swiss franc amid rising expectations of a second referendum or the implementation of a "soft" scenario, "BNP Paribas believes.

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Dollar slapped by the Fed

Trading 01 fév 2019 Commentaire »

The pulling of the rope between a weak euro and a dollar that is actively losing last year's trumps results in a consolidation development. If in 2018 the US currency actively used such drivers as the acceleration of the US economy under the influence of fiscal stimulus, aggressive monetary restriction of the Fed and high demand for safe-haven assets in terms of trade wars, then events in 2019 such as the GDP slowdown, pause in the normalization process and Washington and Beijing negotiations should have made her a whipping boy. If it were not for one "but." Competitors are in no hurry to take advantage of yesterday's leader's vulnerabilities.

A strong economy is a strong currency. This principle of fundamental analysis has not been canceled. Also, looking at the technical recession in Italy, the eurozone's GDP growth by 0.2% q/q in July-September and in October-December, disappointing statistics on German retail sales and the stubborn unwillingness of core inflation to move away from 1%, we can assume that currency block needs help. For example, it can be in the form of additional monetary incentives (LTRO), which some members of the Governing Council spoke about at the January meeting.

Dynamics of European inflation

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In fact, Mario Draghi does not see an emergency in which one could launch a long-term refinancing program for commercial banks or resume QE. Jens Weidmann draws attention to the lack of ammunition to deal with a potential crisis. They say you need to close your eyes to sluggish inflation and begin to normalize monetary policy. In addition, the progress in the negotiations between the US and China is able to lend a helping hand to European exports and accelerate GDP.

In contrast to the euro, burdened with the problems of the economy of the currency bloc, the dollar is losing fans due to a drastic change in the Fed's global outlook. Just 6 weeks ago, the Central Bank was ready to continue raising the federal funds rate at almost the same pace as in 2018, but in January, Jerome Powell claims that the deterioration of macroeconomic statistics for the States will lead to monetary expansion. Investors seriously believed that the normalization cycle had been completed and were eagerly awaiting new incoming data.

In this regard, the release of the report on the US labor market in January more confused investors than clarified the situation despite the impressive increase in employment outside the agricultural sector (+304 thousand). Additionally, other reports such as unemployment rose to 4%, and the average wage showed much less growth than expected (+ 0.1% vs. + 0.3% m / m). The EUR / USD pair has reacted quite vividly to the numbers, but to say that it has decided on the direction of further movement is extremely rash. Consolidation continues and only a breakthrough of resistances at 1.151 and 1.154 will open the way for the bulls to the north.

Technically, correction levels of 78.6% and 88.6% of the CD wave of the Shark pattern are located at these elevations. As a rule, tts transformation into 5-0 gives a hint about the future path of EUR / USD. The fact that the Bears failed to keep the quotes below 50% and 61.8% indicates their weakness.

EUR / USD daily chart

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Eurozone inflation slowed to a minimum in 11 months to January

Trading 01 fév 2019 Commentaire »

According to the statistical report of the EU Eurostat, the growth rate of consumer prices in the eurozone slowed down in January to a minimum in the previous 11 months. Inflation rose by only 1.4% year-over-year in January, while in December last year, the corresponding figure rose by 1.6%. The index of low index growth coincided with market expectations. As you know, the target inflation rate of the European Central Bank (ECB) is the "lower, but close to 2%" area.

The core inflation in January (excluding energy , alcohol and tobacco prices) accelerated to 1.1% after rising 1% in December 2018. Experts predicted that this indicator would remain unchanged.

The largest increase in January was demonstrated by energy prices (2.6%); Consequently, food, alcohol and tobacco increased in price by 1.8%. The cost of services increased by 1.6%, manufactured goods went up by 0.3%.

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Euro: light at the end of the tunnel

Trading 01 fév 2019 Commentaire »

The recent dynamics of the euro against the dollar resembles a rollercoaster ride. Hence, initially the ECB signals about the possibility of expanding stimulus measures sent the EUR/USD pair below $ 1.13, but then, the Fed's hints about a pause in the monetary tightening cycle allowed the single European currency to rise to $ 1.15. However, the ensuing weak data on eurozone GDP cooled the fervor of the bulls.

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On the eve after the head of the Bundesbank said the German economy has entered a period of short-term deceleration, the euro fell sharply. Today, the single European currency managed to win back some of the losses incurred.

If we assume that in the foreseeable future the Fed will not raise the interest rate and if the economic situation in the country deteriorates, it may even be reduced, then the continuation of the EUR / USD movement to the north seems entirely possible.

In addition, the factors that had a negative impact on the growth of the eurozone economy in the third and fourth quarters are expected to be temporary. The settlement of trade disputes between the US and China will have a positive impact on exports and business activity of the currency bloc.

Thus, the gradual improvement of the state of the eurozone economy and the de-escalation of the trade conflict between Washington and Beijing will act as positive factors for the euro. Although, having understood the Celestial Empire, the United States can switch to Europe. Also, do not forget about the Fed's intention to make decisions depending on the incoming data.

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It is assumed that a strong report on the US labor market in January will allow the EUR/USD bears to develop an attack in the direction of 1.12, while weak statistics will give the bulls the hope of resuming the rally to 1.16.

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Bitcoin analysis for February 01, 2019

Trading 01 fév 2019 Commentaire »

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Bitcoin has been trading sideways at around $3,411. Our bearish view from yesterday is still active. Since the key support cluster at $3,420 is broken and was successfully retested, we expect downward continuation. I also found a successful breakout of the most recent mini upward Pitchfork channel, which is another sign of underlying weakness. Short-term resistance is set at the price of $3,452 and short-term support at $3,324.

R1: $3.457

R2: $3.504

R3: $3.535

Pivot: $3.425

S1: $3.378

S2: $3.347

S3: $3.300

Trading recommendation: We are still short BTC/USD from $3,392 and with the target at $3,107. Protective stop is placed at the price of $3,550

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Analysis of Gold for February 01, 2019

Trading 01 fév 2019 Commentaire »

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Buying climax in the background on Gold. The buying climax represents a big sign of weakness, which made Gold trade sideways. So far, I found that buyers don't have power for another strong push higher, so we exited our both long positions with 3,700-pips profit. Now we are waiting for a potential break of the key short-term support at $1,316.00 to confirm the downside. Major resistance is set at the price of $1,325.00.The potential head and shoulders pattern is in creation, which is another sign of the potential weakness.

R1: $1.330.00

R2: $1.335.50

R3: $1.339.45

Pivot: $1.326.80

S1: $1.321.25

S2: $1.317.27

S3: $1.312.35

Trading recommendation: We are neutral on Gold but if we see the break of the support ($1.316.00), we will sell Gold with SL at $1.325.00 and targets at $1.309.50-$1.298.00.

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Fundamental Analysis of NZDJPY for February 1, 2019

Trading 01 fév 2019 Commentaire »

NZD/JPY has been quite impulsive and volatile under the recent bullish momentum which led the price towards 75.50 area recently. JPY has been quite solid in light of the latest economic reports, whereas NZD might lose ground after the positive Trade Balance report.

Recently New Zealand's Trade Balance report showed a proficit at 264M from the previous deficit of -955M, analysts had expected more modest proficit at 255M. This significant change in the Trade Balance helped NZD to attract market sentiment, but sustainability against JPY may fade in the coming days. Recently Japan's Finance Minister defended the government's view that incomes are rising despite the challenges faced by the economy earlier. Today, Japan's Unemployment Report showed decrease to 2.4% which was expected to be unchanged at 2.5% and Final Manufacturing PMI ticked up to 50.3 instead of the flat forecast at 50.0. Despite the massive monetary stimulus over 6 years, Japan's wages have been creeping with the muted growth. The recent monitoring revealed positive changes.

Meanwhile, JPY has found support from the economic reports published throughout the week, it but could not gain momentum against NZD. Ahead of employment reports from New Zealand to be published next week, JPY is expected to regain some grounds in the coming days which might strengthen further if NZD fails to provide good economic data in the future.

Now let us look at the technical view. The price is being held by the GANN Grid Lines as resistance while being supported by the dynamic level of 20 EMA throughout the bullish pressure in the pair. The price recently bounced off the 75.50 area with strong bearish momentum which is expected to lead the price towards 74.50 and later towards 73.00 area in the future. As the price remains below 75.50 area with a daily close, the bearish bias is expected to continue.

SUPPORT: 73.00, 74.50

RESISTANCE: 75.50, 77.00

BIAS: BULLISH

MOMENTUM: VOLATILE

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GBP/USD analysis for February 01, 2019

Trading 01 fév 2019 Commentaire »

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With the down break of the larger upward Pitchfork channel, the GBP/USD pair changed behavior from bullish to bearish. The key support at 1.3055 is broken and this is a good confirmation of weakness. I also found a breakout of the upward mini Pitchfork channel, which is another confirmation of weakness. As long as the resistance is holding at 1.3160, a downward movement is expected. The short-term trend is bearish.

R1: 1.3148

R2: 1.3186

R3: 1.3210

Pivot: 1.3123

S1: 1.3085

S2: 1.3060

S3: 1.3025

Trading recommendation: We are bearish on the GBP/USD from 1.3050 with the downward target at the price of 1.2905. The protective stop is placed at 1.3165.

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GBP / USD pair: plan for the American session on February 1. The pound fell on weak data on manufacturing activity

Trading 01 fév 2019 Commentaire »

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

The UK manufacturing sector PMI was worse than economists' forecasts, which led to the return of the pair to the large support area of 1.3053, from which buyers are now trying to build a new upward trend. As long as trade is conducted above this level, the demand for the pound will remain and a weak report on the US labor market may quickly return the pair to the average border of 1.3104 and also lead to an update of the maximum of 1.3159, where I recommend taking profits. In the case of a decrease in the pound in the second half of the day, long positions can be viewed at a rebound from the support of 1.2971.

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

A repeated support test of 1.3053, together with good data on the US labor market, will lead to a continuation of the GBP/USD decline with a minimum of 1.2971, where I recommend taking profits. In the case of a pound rise in the afternoon, sales can return only on a false breakdown from the average border of the side channel 1.3104 or on the rebound from 1.3159.

More in the video forecast for February 1

Indicator signals:

Moving averages

Trade is conducted in the area of 30- and 50-day moving, which indicates the lateral nature of the market.

Bollinger bands

Bollinger Bands indicator volatility has decreased, which does not give signals on the market entry.

Description of indicators

MA (moving average) 50 days - yellow

MA (moving average) 30 days - green

MACD: fast EMA 12, slow EMA 26, SMA 9

Bollinger Bands 20

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