*ECB Cuts 2019 Inflation Forecast To 1.2% From 1.6%

Trading 07 mar 2019 Commentaire »

ECB Cuts 2019 Inflation Forecast To 1.2% From 1.6%


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*ECB Lowers 2020 Inflation Outlook To 1.5% From 1.7%

Trading 07 mar 2019 Commentaire »

ECB Lowers 2020 Inflation Outlook To 1.5% From 1.7%


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Trump and the dollar in the sights of politicians

Trading 07 mar 2019 Commentaire »

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While the markets are carefully sifting through and interpreting the results of the meeting of the ECB, which has postponed the term of the rate increase, America strongly criticizes its president for unfulfilled election promises. The economy did not manage to accelerate to 3%, even under the influence of a large-scale fiscal stimulus, the indicator grew by 2.9% in 2018. In addition, the negative balance of trade in goods increased to a record high of $ 891.3 billion. Something suggests that without the support of tax reform, the economy will not be able to surpass last year's result. It is hard to believe that after concluding a deal with China, Donald Trump will achieve a return of the imbalance of foreign trade to the levels that were under Barack Obama. Curiously, with what promises will the current head of the White House go to repeat elections in 2020?

Trump's Democrats are now richly criticized, calling his policy "erroneous" and demanding an explanation of how the president "is going to improve all these deficits!" It's important to know that the outpacing growth in imports (7.5%) over exports (6.3%) is due to high domestic demand on the background of external weakness. The negative balance of foreign trade to GDP increased to 3% from 2.8%, which is much lower than 10 years before the start of the great recession (6%).

The deterioration of foreign trade occurred, including at the expense of an expensive dollar, whose growth has repeatedly tried to suppress Trump. It is not easy to make the US currency weaker in conditions when the whole world is facing a serious economic slowdown, and the United States looks like an island of stability. This year, the US economy will expand by 2.6%, while eurozone GDP is only 1%, predicted in the OECD. Note that the estimate for the eurozone is significantly reduced, in November, a rise of 1.8% was expected (!). Italy will go into recession, and the German economy will show a slight increase of 0.8%. According to an authoritative organization, a substantial increase in wages and household expenditures will not be enough to compensate for the effects of trade friction and political uncertainty.

What is the future of EURUSD?

In the next 12 months, dollar positions will significantly weaken across the entire spectrum of the market. This will contribute to the slowdown of the US economy, the growth of the budget deficit and the soft rhetoric of the Fed. EURUSD may rise to $ 1.19. This is the forecast of market experts who participated in the Reuters survey from February 28 to March 6.

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Although respondents continue to wait for EURUSD growth, their average forecast for the main pair was slightly lower than a month ago.

The outlook for the dollar is unlikely to improve after the end of the trade war between the United States and China, experts say. If you give an estimate for the next month, in the case of a trade deal, the dollar's position will remain unchanged, and if the war continues, it will rise by 1%.

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*ECB Maintains 2021 Growth Projection At 1.5%

Trading 07 mar 2019 Commentaire »

ECB Maintains 2021 Growth Projection At 1.5%


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*ECB Trims 2020 Growth Outlook To 1.6% From 1.7%

Trading 07 mar 2019 Commentaire »

ECB Trims 2020 Growth Outlook To 1.6% From 1.7%


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Eurozone’s GDP grew by 0.2% in Q4

Trading 07 mar 2019 Commentaire »

According to the European statistical agency, Eurostat, the economic growth in 19 eurozone countries in the fourth quarter of 2018 was 0.2% in quarterly terms and 1.1% in annualized terms. Quarterly figures coincided with analysts' expectations but the annual figure was lower than the forecast of 1.2%.

In the fourth quarter, the overall GDP growth of all EU countries was 0.3% in quarterly terms and 1.4% in annual terms.

At the end of 2018, the GDP of eurozone and EU increased by 1.8% and 1.9%, respectively.

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How soon will oil quotes reach $70 a barrel?

Trading 07 mar 2019 Commentaire »

According to analysts of Bank of America, the situation on the oil market looks much more stable now than it might seem at first glance.

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"The continuing decline in the extraction of raw materials in Venezuela and Iran, combined with the reduction in production from OPEC +, allows us to expect attempts to break through oil prices in the direction of $70 per barrel in the short term," representatives of the financial institution said.

"However, more impressive growth in the cost of black gold is unlikely to be sustainable, since American manufacturers are not asleep, and for them, such a development is an extremely attractive opportunity in the struggle to increase market share," they added.

In turn, UBS specialists believe that the supply of black gold will continue to decline in the coming months, thanks to the implementation of the OPEC + agreement and strong demand. According to the bank's forecast in the medium term, a barrel of raw materials of Brent grade may rise in price between $70 and $80.

Barclays experts also maintain a positive attitude towards the prospects for the oil market. They expect that the average price of Brent crude oil will reach $ 70 per barrel this year.

"Despite numerous indicators of a slowdown in the global economy, the demand for black gold remains steady. We think that the main source of uncertainty for the oil market in the current year will not be the United States but the reaction of OPEC to the political decisions of the States, "Barclays said.

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GBP / USD plan for the American session on March 7. Buyers did not have enough strength for a new spurt

Trading 07 mar 2019 Commentaire »

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

Buyers have not managed to return to the resistance level of 1.3194, which led to a decrease in the pound in the morning. At the moment, you can rely on the formation of a false breakdown in the area of support at 1.3122. However, larger purchases are best done on a rebound from 1.3049 and 1.2973 lows. The main objective remains the same which is to break through the resistance level of 1.3194 that will open the way to the highs of 1.3251 and 1.3308.

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

Sellers need a breakdown of the lower boundary of the side channel in the area of 1.3122 in the second half of the day. In turn, this will lead to a larger sale with an update of 1.3049 and 1.2973 minima, where I recommend taking profits. Given the growth scenario of the pound in the second half of the day, only a false breakdown in the area of resistance at 1.3194 will be the first signal for sales. Otherwise, opening short positions can be safely opened from the highs of 1.3251 and 1.3308.

More in the video forecast for March 7

Indicator signals:

Moving averages

Trade is conducted in the region of 30- and 50-medium moving, but the market is already on the side of sellers.

Bollinger bands

Bollinger Bands indicator volatility is very low, which does not give signals on market entry.

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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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EUR / USD plan for the US session on March 7. Traders are waiting for statements from the European Central Bank

Trading 07 mar 2019 Commentaire »

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

Given the low volatility of the market, trade has moved to a narrow side of the channel at 1.1290-1.1323. Today, it is best to return to the euro after the press conference of the President of the European Central Bank, Mario Draghi, which may coincide with a breakthrough and fixing of the EUR/USD pair above the resistance of 1.1323 and lead to a break in the downtrend and update highs around 1.1345 and 1.1368, where I recommend fixing the profit. In the case of a decline during the speech of the head of the ECB, it is best to return to long positions on a false breakdown in the region of 1.1290 or to rebound from the lows of 1.1263 and 1.1235.

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

Bears need to rely on the formation of a false breakdown in the area of 1.1323, as well as on the specifics of the LTRO program. The launch of which may cause the euro to weaken in the short term and the main task of sellers will be a breakthrough and fixation below the resistance of 1.1290, which will lead to an update of the minima in the area of 1.1263 and 1.1235, where I recommend taking profits. In the case of euro growth at the speech of Mario Draghi, you can take a closer look at short positions when updating highs around 1.1345 and 1.1368.

More in the video forecast for March 7

Indicator signals:

Moving averages

Trade remains below the 30- and 50-medium moving, which indicates the lateral nature of the market.

Bollinger bands

Volatility is very low, which does not give signals to enter the market.

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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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Bitcoin analysis for March 07, 2019

Trading 07 mar 2019 Commentaire »

Nothing specially changed since our previous analysis. We still expect lower price on BTC.

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According to the H1 time – frame, we found that there is a potential end of the complex upward correction WXY at the price of $3.870. Also, there is multi resistance around $3.870 (yellow rectangle), which is a sign that buying at this stage looks risky. We also found hidden bearish divergence on the Stochastic oscillator, which is another sign of weakness. The key support is seen at the price of $3.635.

Trading recommendation: We are bearish on BTC from $3.823 with the target at $3.636.

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