Analytics and trading signals for beginners. How to trade EUR/USD on November 20? Getting ready for Friday session

Trading 19 Nov 2020 Commentaire »

Hourly chart of the EUR/USD pair

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The EUR/USD pair fell and reached the support level of 1.1822 twice on Thursday, which we mentioned was the target. In the morning review, we advised beginners to trade down and even take a little risk, moving Stop Loss to breakeven and not paying attention to a possible reversal of the MACD indicator to the upside. We turned out to be right, and traders, as a result, could earn 15-20 points more than if they closed short positions on the MACD reversal to the upside. Now a round of corrective movement may begin, afterwards we can expect the downward trend to return within the horizontal channel. Yes, the euro /dollar pair still remains within the 1.1700-1.1900 horizontal channel, and not breaking its upper border and settling below the upward trend line speaks in favor of the fact that the trend has changed to a downward trend. So now the pair has good prospects to fall to the lower line of the horizontal channel. We remind you that in order to be able to open new short positions, it is better to wait for the MACD indicator to discharge to the zero level.

Not a single macroeconomic report released in the European Union on Thursday. European Central Bank President Christine Lagarde called on the European Commission to resolve all differences as soon as possible and to adopt the budget for 2021-2027 and the Recovery Fund. We have already said that Poland and Hungary vetoed the adoption of these bills due to some disagreements regarding EU legislation, which allows you to cut off the funding of these states. According to Lagarde, the economic recovery plan should start working immediately, without delay. Lagarde noted that the EU economy will obviously suffer from the second wave of infections and repeated hard quarantines and has clear downside risks in the long term. Therefore, the European economy may need additional incentives in the future. This information could have put moderate pressure on the euro currency.

No major events or publications scheduled in the European Union and the United States for Friday. Therefore, the pair's volatility may remain low on the last trading day of the week, as well as throughout the week. Of course, it is possible that we might receive information that was not planned. However, for obvious reasons, it is impossible to predict its nature and possible impact on the foreign exchange market.

Possible scenarios for November 20:

1) Long positions are no longer relevant, since the price has settled below the upward trend line, therefore, the trend has changed to a downward trend. So now you can return to buying the euro but first the current downward trend must end. Under the current conditions, the only option is to overcome the 1.1903 level, which will mean the pair will leave the horizontal channel of 1.1700-1.1900.

2) Trading for a fall at this time is relevant, since the trend has changed to a downward one. At the moment, an upward correction has begun, you must wait for it to end in order to be able to open new short positions with targets at 1.1822 and 1.1796. Most likely, the correction will end no earlier than Friday morning, so a new assessment of the situation can be carried out by then. The main thing is that the MACD indicator can and has time to discharge to the zero level.

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

South Africa Central Bank Holds Rate Steady

Trading 19 Nov 2020 Commentaire »

South Africa's central bank left the key interest rate unchanged on Thursday, in a split vote, citing downside risks to inflation amid a slow economic recovery.

The Monetary Policy Committee decided to leave the repo rate unchanged at 3.5 percent, South African Reserve Bank Governor Lesetja Kganyago said in a statement.

Two members of the committee preferred a 25 basis point cut, while three preferred to hold rates at the current level.

"The Committee notes that the slow recovery will keep inflation below the midpoint of the target range for this year and next," Kganyago said.

"Unless risks outlined earlier materialize, inflation is expected to be well contained over the medium-term, remaining below but close to the midpoint in 2021 and 2022."

The bank forecast consumer price inflation at 3.2 percent this year and lowered the projection for next year to 3.9 percent. Price growth is seen at 4.4 percent in 2022.

The core inflation forecasts were lowered to 3.3 percent for this year and to 3.4 percent for next. The outlook for 2022 was left unchanged at 4.0 percent.

The central bank revised up the third quarter sequential growth forecast to 50.3 percent.

The projection for the full year was revised to -8.0 percent from -8.2 percent predicted in September.

The bank forecast GDP growth of 3.5 percent for next year and 2.4 percent in 2022.


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

Treasury Announces Details Of 2-Year, 5-Year And 7-Year Note Auctions

Trading 19 Nov 2020 Commentaire »

The Treasury Department on Thursday announced the details of this month's auctions of two-year, five-year and seven-year notes.

The Treasury revealed it plans to sell $56 billion worth of two-year notes, $57 billion worth of five-year notes and $56 billion worth of seven-year notes.

The results of the two-year and five-year note auctions will be announced next Monday, while the results of the seven-year note auction will be announced next Tuesday.

Last month, the Treasury sold $54 billion worth of two-year notes, $55 billion worth of five-year notes and $53 billion worth of seven-year notes.

The two-year note auction attracted modestly above average demand, while the five-year and seven-year note auctions attracted below average demand.


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

U.S. Leading Economic Index Climbs In Line With Estimates In October

Trading 19 Nov 2020 Commentaire »

A reading on leading U.S. economic indicators increased in line with economist estimates in the month of October, according to a report released by the Conference Board on Thursday.

The Conference Board said its leading economic index climbed by 0.7 percent in October, matching the increase seen in the previous month as well as expectations.

Ataman Ozyildirim, Senior Director of Economic Research at The Conference Board, said the continued advance by the index reflected widespread improvements despite weakness from housing permits and consumers' outlook on economic conditions.

"However, the leading index has been decelerating in recent months, which suggests growth will moderate significantly in the final months of 2020, slowing down from the unusually rapid pace in Q3," Ozyildirim said.

He added, "Furthermore, downside risks to growth from a second wave of COVID-19 and high unemployment persist."

The report said the coincident economic index also increased by 0.5 percent in October after rising by 0.4 percent in September.

Meanwhile, the lagging economic index inched up by 0.1 percent in October following a 0.3 percent drop in the previous month.


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

U.S. Existing Home Sales Unexpectedly Spike To 14-Year High In October

Trading 19 Nov 2020 Commentaire »

A report released by the National Association of Realtors on Thursday unexpectedly showed a continued increase in existing home sales in the U.S. in the month of October.

NAR said existing home sales jumped by 4.3 percent to an annual rate of 6.85 million in October after soaring by 9.9 percent to a revised rate of 6.57 million in September.

The sharp increase came as a surprise to economists, who had expected existing home sales to slump by 1.4 percent to a rate of 6.45 million from the 6.54 million originally reported for the previous month.

With the unexpected spike, existing home sales reached their highest level since February of 2006. Existing home sales were up by 26.6 percent compared to the same month a year ago.

"Considering that we remain in a period of stubbornly high unemployment relative to pre-pandemic levels, the housing sector has performed remarkably well this year," said Lawrence Yun, NAR's chief economist.

"The surge in sales in recent months has now offset the spring market losses," he added. "With news that a COVID-19 vaccine will soon be available, and with mortgage rates projected to hover around 3% in 2021, I expect the market's growth to continue into 2021."

The report said the median existing home price was $313,000 in October, up 0.5 percent from $311,400 in September and up 15.5 percent from $271,100 in the same month a year ago.

Meanwhile, housing inventory at the end of October totaled 1.42 million units, down 2.7 percent from 1.46 million in September and down 19.8 percent from 1.77 million in October of 2019.

The unsold inventory represents an all-time low of 2.5 months of supply at the current sales pace, down from 2.7 months in September and down from 3.9 months a year ago.

"Homebuilders' confidence has soared even though the actual production has not," Yun said. "All measures, such as reduction to lumber tariffs and expansion of vocational training, need to be considered to significantly boost supply and construct new housing."

NAR said single-family home sales surged up by 4.1 percent to an annual rate of 6.12 million in October, while existing condominium and co-cop sales spiked by 5.8 percent to a rate of 730,000.

Next Wednesday, the Commerce Department is scheduled to release a separate report on new home sales in the month of October.


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*U.S. Leading Economic Index Climbs 0.7% In October

Trading 19 Nov 2020 Commentaire »

U.S. Leading Economic Index Climbs 0.7% In October


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

*U.S. Existing Home Sales Spike 4.3% In October

Trading 19 Nov 2020 Commentaire »

U.S. Existing Home Sales Spike 4.3% In October


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

Philly Fed Index Indicates Slower Growth In November

Trading 19 Nov 2020 Commentaire »

Philadelphia-area manufacturing activity has seen continued growth in the month of November, the Federal Reserve Bank of Philadelphia revealed in a report on Thursday, although the pace of growth slowed compared to the previous month.

The report said the Philly Fed Index pulled back to 26.3 in November after spiking to 32.3 in October, but a positive reading still indicates growth in regional manufacturing activity. Economists had expected the index to drop to 22.0.

The pullback by the headline index came as the new orders index slumped to 37.9 in November from 42.6 in October and the shipments index plunged to 24.9 from 46.5.

Meanwhile, the number of employees index jumped to 27.2 in November from 12.7 in October, indicating a notable acceleration in the pace of job growth.

The report said the prices paid index also surged up to 38.9 in November from 28.5 in October, while the prices received index spiked to 25.4 from 14.0.

Looking ahead, the Philly Fed said most future indexes moderated this month but continue to indicate that firms expect growth over the next six months.

The diffusion index for future general activity tumbled to 44.3 in November after soaring to a four-month high of 62.7 in October.

"Manufacturing staged a fairly solid recovery from the depths of the pandemic crisis, but we're concerned about future activity as the pandemic surges and lawmakers look unlikely to deliver imminent and major fiscal aid," said Oren Klachkin, Lead U.S. Economist at Oxford Economics.

He added, "Weakening demand, a fading fiscal boost, ongoing supply chain issues, and an accelerating pandemic crisis risk hobbling manufacturing's recovery ahead."

On Monday, the New York Fed released a separate report showing New York manufacturing activity unexpectedly expanded at a slower rate in the month of November.

The New York Fed said its general business conditions index fell to 6.3 in November from 10.5 in October. While a positive reading still indicates growth in regional manufacturing activity, economists had expected the index to rise to 13.5.


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U.S. Jobless Claims Unexpectedly Rebound From Eight-Month Low

Trading 19 Nov 2020 Commentaire »

After reporting initial jobless claims at their lowest level since before the coronavirus-induced lockdowns in the previous week, the Labor Department released a report on Thursday showing an unexpected rebound in jobless claims in the week ended November 14th.

The Labor Department said jobless claims climbed to 742,000, an increase of 31,000 from the previous week's revised level of 711,000.

The rebound came as a surprise to economists, who had expected jobless claims to edge down to 707,000 from the 709,000 originally reported for the previous week.

In the previous week, jobless claims fell to their lowest level since hitting 282,000 in the week ended March 14th.

"The risk may be for a further rise in claims as coronavirus cases surge and some states impose restrictions on activity," said Nancy Vanden Houten, Lead U.S. Economist at Oxford Economics.

Meanwhile, the report said the less volatile four-week moving average fell to 742,000, a decrease of 13,750 from the previous week's revised average of 755,750.

The Labor Department said continuing claims, a reading on the number of people receiving ongoing unemployment assistance, also tumbled by 429,000 to 6.372 million in the week ended November 7th.

The four-week moving average of continuing claims slumped to 7,054,500, a decrease of 525,000 from the previous week's revised average of 7,579,500.

Vanden Houten said, "Continuing claims for regular benefits extended their decline, but that positive trend is partly outweighed by the number of unemployed individuals who have exhausted those benefits, evidence of more long-lasting labor market scarring."


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Philly Fed Index Pulls Back Less Than Expected In November

Trading 19 Nov 2020 Commentaire »

Philadelphia-area manufacturing activity has seen continued growth in the month of November, the Federal Reserve Bank of Philadelphia revealed in a report on Thursday, although the pace of growth slowed compared to the previous month.

The report said the Philly Fed Index pulled back to 26.3 in November after spiking to 32.3 in October, but a positive reading still indicates growth in regional manufacturing activity. Economists had expected the index to drop to 22.0.

Looking ahead, the Philly Fed said most future indexes also moderated this month but continue to indicate that firms expect growth over the next six months.


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