Technical analysis of EUR/USD for February 06, 2019

Trading 06 fév 2019 Commentaire »

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Overview:

The EUR/USD pair above around the weekly pivot point (1.1393). It continued to move downwards from the level of 1.1393 to the bottom around 1.1335. Today, the first resistance level is seen at 1.1393 followed by 1.1426, while daily support 1 is seen at 1.1335. Furthermore, the moving average (100) starts signaling a downward trend; therefore, the market is indicating a bearish opportunity below 1.1393. So it will be good to sell at 1.1393 with the first target of 1.1335. It will also call for a downtrend in order to continue towards 1.1294. The strong daily support is seen at the 1.1254 level. According to the previous events, we expect the EUR/USD pair to trade between 1.1393 and 1.1254 in coming hours. The price area of 1.1393 remains a significant resistance zone. Thus, the trend is still bearish as long as the level of 1.1393 is not broken. On the contrary, in case a reversal takes place and the EUR/USD pair breaks through the resistance level of 1.1393, then a stop loss should be placed at 1.1453.

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Technical analysis of NZD/USD for February 06, 2019

Trading 06 fév 2019 Commentaire »

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Overview:

The NZD/USD pair breached resistance which had turned into strong support at the level of 0.6705 this week. The level of 0.6705 coincides with a golden ratio (61.8% of Fibonacci), which is expected to act as major support today. The RSI is considered to be overbought, because it is above 70. The RSI is still signaling that the trend is upward as it is still strong above the moving average (100). Besides, note that the pivot point is seen at the point of 0.6882. This suggests that the pair will probably go up in the coming hours. Accordingly, the market is likely to show signs of a bullish trend. In other words, buy orders are recommended to be placed above 0.6800 with the first target at the level of 0.6882. From this point, the pair is likely to begin an ascending movement to the point of 0.6882 and further to the level of 0.6984. The level of 0.6984 will act as strong resistance. However, if there is a breakout at the support level of 0.6705, this scenario may become invalidated.

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US dollar: is recession inevitable?

Trading 06 fév 2019 Commentaire »

The PMI indices, published on Tuesday, confirm the assumption that the change of the Fed's rhetoric was not accidental, business activity in the US is slowing down. The January ISM index for the services sector, while still at a high level of 56.7, fell against 58.0p a month earlier, this is the worst value since March 2018, and the IBD / TIPP economic optimism index instead of the projected growth fell from 52.3p to 50.3p, it is the minimum in 19 months.

The Congressional Budget Committee (NWO) has published the next 10-year forecast, from which rather gloomy prospects follow. It is assumed that already this year the federal budget deficit will reach 900 billion dollars, and from 2022, it will exceed 1 trillion a year and will range from 4.1% to 4.7% of GDP, which is significantly higher than the average for 50 years. Due to the constantly growing deficit, the federal debt will rise to 150% of GDP by 2049, well ahead of the previous record set after World War 2.

As the head of NWO explained in the comments to the forecast, the current scenario is more optimistic than negative, since federal spending will grow at a high rate, mainly due to interest payments and social security costs

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As for revenues, their growth is largely expected due to the planned completion of the tax benefit period within the Trump reforms. The average budget deficit of 4.4% for the next 10 years against the background of low unemployment is an unusual and frightening phenomenon since it indicates that even with an economy operating at full capacity, it is unrealistic to reach a deficit-free budget.

In other words, CBO sees no prospects for higher income growth and come to the conclusion that the likelihood of a fiscal crisis is increasing, which is another argument in favor of approaching a large-scale recession.

Trump's speech in the US Congress was mainly devoted to attempts to justify the need to build a border wall between the United States and Mexico, assurances of the success of tax reform, but did not give any clarity neither on the trade negotiations with China, nor on the possibility of another shutdown after the current extension.

Eurozone

The volume of production orders in Germany declined by 1.6% in December, year-on-year, a fall of 7%, a decline in production was observed in 7 of the last 8 months, which indicates a protracted and systemic nature. According to experts from Deutsche Bank, Germany is very close to a recession, and in the first quarter of this year, we should expect a decline in GDP. In a similar situation is the third eurozone economy in Italy, and the situation is aggravated by a serious debt crisis.

Today, the ECB will publish a regular economic bulletin, which is expected to provide explanations of its estimates on a number of macroeconomic indicators. In any case, there is no positive wait, EUR / USD is under pressure, support is at 1.1360 / 70 and 1.1335 / 40, corrective growth is unlikely.

Great Britain

The slowdown in business activity in all sectors of the UK economy, without exception, against the backdrop of a political crisis associated with a country's exit from the EU, does not give any reason to believe that the Bank of England at this meeting will be able to voice at least some positive. Voting at a rate is assumed to be unanimous in favor of keeping the current policy unchanged, the inflation report will give guidance on the main macroeconomic indicators.

In general, the pound has no reason to resume growth at least until the final decision on the issue of Brexit. The EU has made it clear that new negotiations are excluded, so the best option would be to accept the inevitable. GBP / USD will try to find support in the zone of 1.2901 / 10, but in any case, it will be temporary and will not be able to stop further decline.

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Burning forecast 02/06/2019

Trading 06 fév 2019 Commentaire »

The growth momentum of the euro, received last week, ran out of fuel, and did not end with a strong movement.

The euro has returned to the range - again.

There was not enough positive news - but the market is full of pessimism.

Nevertheless, we are waiting for the beginning of the movement after breaking the boundaries of the range:

We are ready to sell EURUSD at a break below 1.1285.

We are ready to buy the euro at the break of 1.1515 upwards.

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Wave analysis of GBP / USD for February 6. New downtrend trend

Trading 06 fév 2019 Commentaire »

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Wave counting analysis:

On February 5, the GBP / USD pair lost 85 bp, so the wave pattern suffered certain changes due to the fact that according to the previous markup, wave 4 went beyond the maximum of wave 1. The entire upward trend segment, taking its beginning on January 3, was transformed in the three wave. Thus, the tool has now moved on to building a downtrend of the trend, which can also be three-wave. Moreover, I expect a general tool decline of at least 26 and 25 figures. Furthermore, the news background is already on the side of the current wave marking now. . On the other hand, there is no final decision on Brexit, how Theresa May's visit to Brussels will end is unknown, and a new parliamentary vote will be held on February 13 This all supports the option of reducing the pair.

Shopping goals:

1.3216 - 0.0% Fibonacci (formal goal)

Sales targets:

1.2827 - 50.0% Fibonacci

1.2734 - 61.8% Fibonacci

General conclusions and trading recommendations:

The wave pattern has suffered adjustments, and the uptrend of the trend now looks complete. Thus, I recommend selling the instrument with targets located near the estimated marks of 1.2827 and 1.2734, which corresponds to 50.0% and 61.8% in Fibonacci. The fall potential of the pound sterling is much greater, especially if the situation on Brexit does not clear up or will shift more and more towards the disordered exit of the United Kingdom from the European Union.

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Indicator analysis. Daily review for February 6, 2019 for the EUR / USD pair

Trading 06 fév 2019 Commentaire »

On Wednesday, the price will continue to move down. The first lower target of 1.1377 is the recoiling level of 61.8% (blue dashed line). Then the top is possible.

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Fig. 1 (daily schedule).

Comprehensive analysis:

- indicator analysis - down;

- Fibonacci levels - down;

- volumes - up;

- candlestick analysis - up;

- trend analysis - down;

- Bollinger lines - down;

- weekly schedule - down.

General conclusion:

On Wednesday, the price will continue to move down. The first lower target of 1.1377 is the recoiling level of 61.8% (blue dashed line). Then the top is possible.

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Wave analysis of EUR / USD for February 6. Eurocurrency continues to fall, corresponding to the wave pattern

Trading 06 fév 2019 Commentaire »

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Wave counting analysis:

On Tuesday, February 5, trading ended for EUR / USD by another 35 bp decline. Thus, the current wave counting retains its integrity and implies the continuation of the construction of the downward wave 3 with targets located near the level of 0.0% Fibonacci and below. Even with the fulfillment of the backup version, which involves building not a pulsed, but a three-wave section of the trend, a decline is still expected within wave c. With regard to the news background, yesterday's reports showed a slight improvement in business activity in Europe and a deterioration in the United States. However, the dollar still continues to be in demand, which coincides with the prospects for the wave pattern.

Sales targets:

1,1289 - 0.0% Fibonacci

1.1215 - 0.0% Fibonacci

Shopping goals:

1.1502 - 76.4% Fibonacci

1.1569 - 100.0% Fibonacci

General conclusions and trading recommendations:

The pair continues to build a downward wave of 3. Thus, now I still recommend selling the instrument with targets located near the marks of 1.1289 and 1.1215, which equates to 0.0% and 0.0% Fibonacci. There are no prerequisites for changing the working version. It is needed to clarify the wave marking now.

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Overview of the foreign exchange market on February 6, 2019

Trading 06 fév 2019 Commentaire »

The dollar continues its steady climb, which is a combination of several factors at once. It was not without Brexit, around which disputes and other scandals do not subside. Theresa May is once again sent to Brussels to negotiate with Jean-Claude Juncker, who is already tired of repeating to her that the existing version of the agreement, which does not suit the British parliament, is final and will not be changed. It should be recalled that the Minister of Commerce of Great Britain recently swore that he was about to sign separate trade agreements with each of the countries of the European dormitory that he would relieve parliamentarians' concerns about the border between Ireland and Northern Ireland. But for a strange reason, the ministry remains silent. In other words, the United Kingdom is in an extremely inconvenient position, since, in fact, it was imposed on such a withdrawal from the European Union, which not only does not take into account the economic interests of Great Britain, but also threatens its territorial integrity. And there is no turning back, because voters will not understand such a turn. The politicians themselves are still planning to continue their political career, which brings them not modest welfare. The moral of this story is that when you put such serious questions to a vote, you need to convey to the voters the information in full, explaining all aspects of this issue, including those that do not lie on the surface. Although there is an option that the British political class itself simply did not know about the pitfalls. So investors have something to fear, since politicians do not understand what they are doing.

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Another factor in the strengthening of the dollar was European statistics, especially retail sales data, which, although they turned out to be better than expected, are not particularly encouraging. Indeed, the growth rate of retail sales slowed from 1.8% to 0.8%, although they expected a slowdown to 0.5%. Nevertheless, there is almost a two-fold slowdown in growth rates, which is unlikely to please anyone. Against this background, even the final data on business activity indices were of little interest to anyone, although they did not coincide with preliminary data. Thus, the business activity index in the service sector remained unchanged, rather than decreased from 51.2 to 50.8, and the composite index decreased from 51.1 to 51.0, and not to 50.7. Similar data in the United States also did not coincide with the forecasts, and although the business activity index in the service sector showed the same results as the preliminary estimate, that is, it decreased from 54.4 to 54.2, but the composite index did not increase from 54.4 to 54.5, but remained unchanged.

Today, neither in the Old World nor in the New World does not come out any serious data, and only regular statements regarding Brexit can affect the markets. Given that the tone of these very statements is constantly changing (sometimes positive with negative, then vice versa), it is likely that the next words of politicians will have a more beneficial effect. Beneficial for the pound and the single European currency. If, however, someone decides to say something. But even without this, given the confident strengthening of the dollar for several days, a local correction suggests itself, and the calm information background does not contradict this.

So we can expect the growth of the single European currency to 1.1400 - 1.1425.

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The pound should also grow, to about 1.2975 - 1.3000.

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Indicator analysis. Daily review for February 6, 2019 for the pair GBP / USD

Trading 06 fév 2019 Commentaire »

Trend analysis (Fig. 1).

On Wednesday, the price will continue to move down. The first lower target 1.2920 is the recoiling level of 38.2.% (Blue dashed line).

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Fig. 1 (daily schedule).

Comprehensive analysis:

- indicator analysis - down;

- Fibonacci levels - down;

- volumes - up;

- candlestick analysis - up;

- trend analysis - up;

- Bollinger lines - down;

- weekly schedule - down.

General conclusion:

On Wednesday, the price will continue to move down. The first lower target 1.2920 is the recoiling level of 38.2.% (Blue dashed line).

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

Trading plan for 06/02/2019

Trading 06 fév 2019 Commentaire »

Trading plan for 06/02/2019:

The message of US President Trump was without major surprises and the rest of the market went through the night in peace.

The declines in USD appeared after Trump's words suggesting that the investigations carried out against him pose a threat to economic development. On the theme of the wall on the border with Mexico, Trump did not announce the introduction of a state of emergency, which some feared. Trump expressed optimism in the subject of progress in trade talks with China.Today in the morning EUR / USD falls to 1.1380 after disappointong data on orders from Germany. In December, new orders fell by 1.6% m / m, while an increase of 0.3% was expected. One of the good news is the revision of the November reading from -1.0% up to -0.2%. Lack of fresh impulses dampened volatility in the Asian stock market. Japanese Nikke225 rose by a modest 0.14 percent. China and several markets remain closed due to holidays

On Wednesday, the 6th of February, the event calndar is light in important data releases, but the global investors should keep an eye on Factory Orders data from Germany, Trade Balance data form the US and Ivey Purchasing Managers Index data from Canada. There is a speech from BOC Deputy Governor Timothy Lane scheduled later today as well.USD/CAD analysis for 06/02/2019:

The Ivey Purchasing Managers Index from Canada are scheduled for release today at 03:00 pm GMt and the global investors expect a decrease from 59.7 to 56.4 points in the reported month.

The Ivey Purchasing Managers Index (PMI) is an economic index which measures the month to month variation in economic activity as indicated by a panel of purchasing managers from across Canada, and is prepared by the Richard Ivey School of Business. The PMI is provided in two formats: unadjusted and seasonally adjusted. It shows responses to one question: "Were your purchases last month in dollars higher, the same, or lower than the previous month?". A figure above 50 shows an increase while below 50 shows a decrease.

Let's now take a look at the USD/CAD technical picture at the H4 time frame. The market is now in a pull-back after the low at the level of 1.3068 has been made. The bulls have managed to push the price towards the important technical resistnace zone between the levels of 1.3158 - 1.3164 and now await the Ivey PMI data. A better than expected data might push the prices back down towards the level of support at 1.3126. On the other hand, a worse than expected data can push the prices towards the nearest techncial resistane at the level of 1.3178 and 1.3200.

Trading recommendations:

The market is in the right level to enter the trade and the trend-following daytraders should try to open sell orders as close to the level of 1.3164 as possible. The target for the shorts is seen at the level of 1.3126 and then at 1.3087 and 1.3068. Worse than expected data will help to push the prices lower, so it is worth to wait for the release.

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