Analytics and trading signals for beginners. How to trade EUR/USD on November 18? Getting ready for Wednesday session

Trading 17 Nov 2020 Commentaire »

Hourly chart of the EUR/USD pair

The EUR/USD pair made another upward spurt in the upward trend. However, it was extremely difficult for novice traders to trade today, since early in the morning the pair immediately grew by around 30 points in an hour, and it was on this candle that a buy signal from MACD was formed. And so a signal appeared while the price had already gone up a decent distance. Nevertheless, even if traders opened buy positions on this signal, they only lost a few points at the time of the MACD indicator's reverse downward reversal. In any case, the losses were small. Unfortunately, the EUR/USD pair came close to the upper border of the horizontal channel and, accordingly, there is a very high probability of a downward reversal in this area and it could start moving towards the lower border of the 1.1700-1.1900 channel, which is where the price has been for about three months. Confidently overcoming the 1.1903 level can provoke a succeeding upward movement, which novice traders can reach. In the meantime, we are still leaning towards the option of a new downward movement.

Novice traders had nothing to pay attention to on Tuesday. There was quite interesting news regarding the adoption of the EU budget for 2021-2027. There were interesting messages from Donald Trump, as well as some interesting reflections on his prospects as president of the United States and actions in the next and remaining ten weeks. However, nothing that could trigger an increase in volatility. As a result, the pair passed only about 50 points in a day, which is quite small, but it eloquently shows that there were no important news and reports during the day. The US currency began to rise in price even towards the evening, which is completely inconsistent with the nature of the retail sales report that was just published and showed a smaller increase in the indicator in October than it was predicted.

The European Union is set to publish a relatively important report on inflation for October. However, it is unlikely to please the buyers of the European currency. The main indicator is forecast to remain at the level of -0.3% y/y. That is, deflation will be recorded in the European Union for the fourth consecutive month. Deflation, like high inflation, is considered a negative factor for any economy. Therefore, this report is unlikely to cause additional demand for the euro. But, in conjunction with the approach to the 1.1903 level, there are increasing chances of a downward reversal and a new fall by 100-150 points.

Possible scenarios for November 18:

1) Since the price continues to trade above the upward trend line, long positions are now relevant. The upside potential of the euro, as always, is limited by the 1.1903 level, and the price is near it. Thus, formally, to open new buy positions, you need to wait for a new signal to buy MACD and trade upward with the target of 1.1900, however, due to the proximity of this level, we recommend that novice traders brace for a downward reversal or they should overcome 1.1903. And only after that, should you consider the possibility of opening new deals.

2) Trading for a fall at this time is not relevant, since there is a pronounced upward trend. Thus, novice traders are advised to wait for the upward trend to end in order to have a reason to open short positions. Namely, the price should settle below the trend line. In this case, open sell orders while aiming for 1.1820 and 1.1790.

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

U.S. Business Inventories Climb More Than Expected In September

Trading 17 Nov 2020 Commentaire »

Partly reflecting a jump in retail inventories, the Commerce Department released a report on Tuesday showing U.S. business inventories increased by more than expected in the month of September.

The report said business inventories climbed by 0.7 percent in September after rising by 0.3 percent in August. Economists had expected inventories to increase by 0.5 percent.

The Commerce Department said retail inventories spiked by 1.7 percent in October after rising by 0.5 percent in September.

Wholesale inventories also rose by 0.4 percent in October following a 0.5 percent increase in September, while manufacturing inventories were unchanged for the second straight month.

Meanwhile, the report said business sales increased by 0.6 percent in October after climbing by 0.9 percent in the previous month.

Retail sales surged up by 1.5 percent in October following a 1.1 percent jump in September. Manufacturing and wholesale sales also inched up by 0.3 percent and 0.1 percent, respectively.

With inventories and sales both rising, the total business inventories/sales ratio in October was unchanged from September at 1.32.


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

U.S. Homebuilder Confidence Climbs To New Record High In November

Trading 17 Nov 2020 Commentaire »

Homebuilder confidence in the U.S. unexpectedly jumped to another new record high in the month of November, the National Association of Home Builders revealed in a report released on Tuesday.

The report said the NAHB/Wells Fargo Housing Market Index climbed to 90 in November from 85 in October. Economists had expected the index to come in unchanged.

"Another record high for the HMI reflects that housing is a bright spot for the economy," said NAHB Chief Economist Robert Dietz. "However, affordability remains an ongoing concern, as construction costs continue to rise and interest rates are expected to move higher as more positive news emerges on the coronavirus vaccine front."

He added, "In the short run, the shift of housing demand to lower density markets such as suburbs and exurbs with ongoing low resale inventory levels is supporting demand for home building."

The unexpected increase by the housing market index came as all three of the HMI indices reached new record highs.

The index gauging current sales conditions climbed to 96 in November from 90 in October, while the measure charting traffic of prospective buyers rose to 77 from 74 and the component measuring sales expectations in the next six months inched up to 89 from 88.

"Though builders continue to sign sales contracts at a solid pace, lot and material availability is holding back some building activity," said NAHB Chairman Chuck Fowke.

He added, "Looking ahead to next year, regulatory policy risk will be a key concern given these supply-side constraints."

On Wednesday, the Commerce Department is scheduled to release its report on new residential construction in the month of October.

Housing starts are expected to climb to an annual rate of 1.460 million in October from 1.415 million in September, while building permits are expected to rise to a rate of 1.560 million from 1.545 million.


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

*U.S. Business Inventories Climb 0.7% In September

Trading 17 Nov 2020 Commentaire »

U.S. Business Inventories Climb 0.7% In September


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

*U.S. Housing Market Index Rise To 90 In November

Trading 17 Nov 2020 Commentaire »

U.S. Housing Market Index Rise To 90 In November


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

U.S. Industrial Production Shows Significant Rebound In October

Trading 17 Nov 2020 Commentaire »

A report released by the Federal Reserve on Thursday showed a significant rebound in U.S. industrial production in the month of October.

The Fed said industrial production jumped by 1.1 percent in October after falling by a revised 0.4 percent in September.

Economists had expected production to surge up by 1.0 percent compared to the 0.6 percent drop originally reported for the previous month.

The rebound in production came as manufacturing output shot up by 1.0 percent in October after inching up by 0.1 percent in September.

The report also showed utilities output spiked by 3.9 percent in October after plunging by 5.2 percent in the previous month.

On the other hand, the Fed said mining output fell by 0.6 percent in October following a 1.2 percent jump in September.

The Fed noted industrial production has recovered much of its 16.5 percent decline from February to April, but output in October was still 5.6 percent lower than its pre-pandemic February level.

"Industrial activity is settling into a slower pace of expansion following the burst of activity unleashed by the release of pent-up demand and a sugar rush from significant fiscal support," said Oren Klachkin, Lead U.S. Economist at Oxford Economics.

He added, "Looking ahead, we expect industrial activity to continue recovering its pandemic-induced losses, but growth will be slower compared to the summer months."

The report also showed capacity utilization in the industrial sector rose to 72.8 percent in October from an upwardly revised 72.0 percent in September.

Economists had expected capacity utilization to climb to 72.3 percent from the 71.5 percent originally reported for the previous month.

Capacity utilization in the manufacturing and utilities sectors rose to 71.7 percent and 72.7 percent, respectively, while capacity utilization in the mining sector edged down to 77.9 percent.


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

U.S. Import Prices Unexpectedly Edge Down 0.1% In October

Trading 17 Nov 2020 Commentaire »

Partly reflecting a continued decrease in prices for fuel imports, the Labor Department released a report on Tuesday showing U.S. import prices unexpectedly edged lower in the month of October.

The Labor Department said import prices slipped by 0.1 percent in October after rising by a downwardly revised 0.2 percent in September.

Economists had expected import prices to rise by 0.2 percent compared to the 0.3 percent increase originally reported for the previous month.

The unexpected drop in import prices came as prices for fuel imports tumbled by 1.9 percent in October after plunging by 5.2 percent in September. The continued decline reflected lower prices for both natural gas and petroleum.

Prices for non-fuel imports inched up by 0.1 percent in October after rising by 0.5 percent in September, as higher prices for non-fuel industrial supplies and materials and foods, feeds, and beverages more than offset falling prices for consumer goods and automotive vehicles.

Meanwhile, the report said export prices crept up by 0.2 percent in October after climbing by 0.6 percent in September. Export prices were expected to rise by 0.3 percent.

The uptick in export prices came as prices for agricultural exports spiked by 3.4 percent in October after jumping by 2.8 percent in September. The sharp increase reflected higher prices for vegetables, corn, soybeans, and dairy products.

Prices for non-agricultural exports were unchanged in October after rising by 0.3 percent in September, as lower prices for non-agricultural industrial supplies and materials and capital goods offset an increase in automotive vehicles prices.

Compared to the same month a year ago, import prices in October were down by 1.0 percent and export prices were down by 1.6 percent.


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

U.S. Retail Sales Growth Slows More Than Expected In October

Trading 17 Nov 2020 Commentaire »

After reporting a sharp increase in U.S. retail sales in the previous month, the Commerce Department released a report on Tuesday showing retail sales rose by less than expected in the month of October.

The report said retail sales rose by 0.3 percent in October after jumping by a downwardly revised 1.6 percent in September.

Economists had expected retail sales to climb by 0.5 percent compared to the 1.9 percent spike originally reported for the previous month.

Excluding an increase in sales by motor vehicle and parts dealers, retail sales edged up by 0.2 percent in October after surging up by 1.2 percent in September. Ex-auto sales were expected to increase by 0.6 percent.

The weaker than expected retail sales growth was partly due to steep drops in sales by clothing and accessories stores, sporting goods, hobby, musical instrument and book stores and department stores.

On the other hand, the report said sales by non-stores retailers surged up by 3.1 percent and sales by electronic and appliances stores jumped by 1.2 percent.

Closely watched core retail sales, which exclude automobiles, gasoline, building materials and food services, inched up by 0.1 percent in October after climbing by 0.9 percent in September.

Gregory Daco, Chief U.S. Economist at Oxford Economics noted retail sales are 4.9 percent above their pre-Covid levels but called the near-term outlook "concerning."

"While phase one of the recovery proved that fiscally supported incomes can be potent drivers of spending on goods, we should not fall for alluring rearview mirror economics," Daco said.

He added, "Phase two of the recovery is significantly slower with muted employment gains and reduced fiscal aid weighing on incomes, and a worsening Covid outbreak once again limiting activity across the country."


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Dollar Little Changed After U.S. Industrial Production

Trading 17 Nov 2020 Commentaire »

Fed's Industrial Production for October has been released at 9:15 am ET Tuesday. The greenback changed little against its major rivals after the data.

The greenback was trading at 104.21 against the yen, 0.9098 against the franc, 1.1876 against the euro and 1.3252 against the pound around 9:20 am ET.


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

*U.S. Industrial Production Jumps 1.1% In October

Trading 17 Nov 2020 Commentaire »

U.S. Industrial Production Jumps 1.1% In October


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