Analytics and trading signals for beginners. How to trade GBP/USD on December 24? Analysis of Wednesday deals. Getting ready

Trading 23 Déc 2020 Commentaire »

Hourly chart of the GBP/USD pair

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The GBP/USD pair traded quite nicely in technical terms on Wednesday. The pound/dollar pair crossed the downward trend line during the day, which is now marked with a dotted line in the chart. Thus, a buy signal was generated, which novice traders had every right to work out, according to our recommendations. If they did this, then at the moment (taking into account the fall in the pair's quotes in the last few hours), they are in profit by around 50 points. If they closed deals near the resistance level of 1.3543, from which the price rebounded, then they earned around 100 points. In any case, we have repeatedly said that a small profit is better than a large loss. Novice traders must learn how to make a little money and only then should they try to master more serious trading methods, more complex systems. At the moment, an upward trend has already appeared, as well as a new upward trend line. Therefore, it is now recommended to consider buy orders. As always, you need to wait for the MACD indicator to discharge and create a new buy signal.

The pound began to rise again on Wednesday, since the market received information from journalists that the EU and the UK have both agreed on a trade deal. This is a classic situation that shows how the markets can react to this or that news, even if it is not official and unconfirmed. It's just that everyone is waiting for a trade deal to be agreed upon (thanks to which the pound has been growing for several consecutive months), so any relatively truthful information is interpreted by traders as an official statement. In general, the pound has risen in price out of the blue again and in general continues to trade near 2.5-year highs. However, if in the coming days (it is unclear how it will be if tomorrow, the day after tomorrow are holidays, and on 26, 27 - weekends) we do not receive confirmation from Michel Barnier or David Frost, then the pound may fall, paring today's growth.

No macroeconomic releases scheduled for Thursday, December 24, both in the UK and US. However, the markets will continue to wait for official information regarding the Brexit talks. So if we manage to receive information, then the pound/dollar pair may be very volatile. On the other hand, no one knows when the official information will come and what it will be. It is quite possible that in reality Barnier and Frost (the heads of the EU and British negotiating groups) did not come to any agreement. Thus, buyers of the pound will be seriously disappointed.

Possible scenarios for December 24:

1) Long positions are relevant again, since the upward trend is present. So now novice traders can close longs that should have been opened today and wait for a new buy signal. It can be from the MACD indicator, if it manages to discharge to the zero mark, or from the trend line, from which a rebound can occur as part of the correction. In both cases, you are advised to buy the pair again while aiming for 1.3543 and 1.3617.

2) Selling is now impractical as the downward trend has been canceled. So now you need to wait for the quotes to settle below the upward trend line and only after that should you sell the pair while aiming for support levels of 1.3377 and 1.3285.

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 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

Analytics and trading signals for beginners. How to trade EUR/USD on December 24? Analysis of Wednesday deals. Getting ready

Trading 23 Déc 2020 Commentaire »

Hourly chart of the EUR/USD pair

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The EUR/USD pair continued to correct within the framework of a new downward trend on Wednesday, which is signaled by a downward trend line. The price tried to start a new round of downward movement, and the MACD indicator generated a sell signal. However, the indicator turned to the downside, below the zero mark. The indicator did not have time to discharge, therefore, it took some time for the signal to appear, and secondly, it was weak. According to yesterday's recommendations, novice traders should not have opened short positions on this signal. Since there weren't any signals during the day, and today, beginners did not have to enter the market for the EUR/USD pair at all. However, take note that the movements from the last few days made it possible for us to create an upward trend line, so now we have a kind of triangle, inside which the quotes are located. Logically, now the pair will try to move towards the downward trend line, rebounding from it can provoke a new round of downward trend. Getting the price to settle above this line will be a strong enough signal for long deals. But getting the pair to settle below the upward trend line will be a powerful signal for new short deals on the pair.

No important news from the European Union and the US on Wednesday, but several relatively important reports were published. Take note that the most important report on orders for durable goods exceeded the forecast value of + 0.6% m/m and reached +0.9%. But the data on personal income and spending of Americans turned out to be much weaker than forecasts. The income level of the population fell by 1.1%, while the level of expenditures - by 0.4%. At the same time, the number of new initial applications for unemployment benefits reached 803,000 (forecast of 882,000), and the number of repeated applications decreased to 5.3 million against the forecast of 5.55 million. In general, today's news could be interpreted in favor of the dollar, but it received market support for only half an hour, and was falling for most of the day (growth of the euro/dollar pair = fall of the dollar).

No macroeconomic events in the US and the European Union on Thursday. The celebration of Christmas begins, so many exchanges, banks and other subjects of the financial system will be closed on Thursday and Friday. Consequently, there will be very little news these days. Unfortunately, now there is not a single global fundamental theme that would constantly influence the pair's movement. So novice traders should pay more attention to technical analysis tomorrow and the day after tomorrow. Volatility can be low these days.

Possible scenarios for December 24:

1) Long positions are currently irrelevant, since a downward trend has formed and there is a trend line. Therefore, we would not recommend opening long positions until this line is crossed. The targets in this case will be near the resistance level of 1.2295.

2) Trading down looks more appropriate, but the correction is still present. So we should wait for it to end, the MACD indicator is already sufficiently discharged (to the zero level), and a sell signal is being created. The upward trend line will provide some resistance to the downward movement, but once it is surpassed, short deals can be left open with the target at 1.2124.

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

Evening review EURUSD 12/23. Weak US data left the market in thought

Trading 23 Déc 2020 Commentaire »

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EURUSD

Last important data came out before Christmas.

Tomorrow is sluggish trade, on Friday - Christmas.

US Employment Report: Long-term unemployment fell by less than 200K to 5.300K - much slower than expected. Consumer income fell -1.1%, inflation = 0%.

At the same time, Congress approved a program of assistance to the economy for $900 billion - within the package, support for citizens of $600, support for small business and medicine.

We keep buying the euro from 1.2190.

Flip down from 1.2130.

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

U.S. Consumer Sentiment Improves Less Than Initially Estimated In December

Trading 23 Déc 2020 Commentaire »

A report released by the University of Michigan on Wednesday showed U.S. consumer sentiment improved by less than initially estimated in the month of December.

The report said the consumer sentiment index for December was downwardly revised to 80.7 from the previously reported 81.4.

While economists had expected a more modest downward revision to 81.3, the index remains well above the final November reading of 76.9.

"The Sentiment Index slipped in late December, although it remained higher than last month despite the ongoing surge in covid infections and deaths," said Surveys of Consumers chief economist Richard Curtin.

He added, "The improvement was due to a large and rapid partisan shift, with Democrats becoming much more positive and Republicans much more negative."

The report said current economic conditions index rose to 90.0 in December from 87.0 in November, while the index of consumer expectations climbed to 74.6 from 70.5.

On the inflation front, one-year inflation expectations slid to 2.5 percent in December from 2.8 percent in November. Five-year inflation expectations were unchanged at 2.5 percent.


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

U.S. New Home Sales Plunge Much More Than Expected In November

Trading 23 Déc 2020 Commentaire »

After reporting an unexpected drop in U.S. new home sales in the previous month, the Commerce Department released a report on Wednesday showing an even more substantial decrease in new home sales in the month of November.

The Commerce Department said new home sales plunged by 11.0 percent to an annual rate of 841,000 in November after sliding by 2.1 percent to a revised rate of 945,000 in October.

Economists had expected new home sales to dip by 0.4 percent to a rate of 995,000 from the 999,000 originally reported for the previous month.

Revised data showed new home sales dropped for the fourth consecutive month, hitting their lowest annual rate since June.

The much bigger than expected decrease was partly due to a steep drop in new home sales in the Midwest, which plunged by 43.3 percent to a rate of 59,000.

New home sales in the West also plummeted by 17.3 percent, while home sales in the Northeast and South slumped by 2.5 percent and 1.9 percent, respectively.

"New home sales were softer than expected in November and appear to be losing momentum as 2020 draws to a close," said Nancy Vanden Houten, Lead U.S. Economist at Oxford Economics. "Still, sales are on track for a gangbusters year, set to grow nearly 20% in 2020."

She added, "We expect some moderation in sales in 2021, but unmet demand and low mortgage rates will continue to support new home sales."

The report said the median sales price of new houses sold in November was $335,300, down 0.7 percent from $337,500 in October but up 2.2 percent from $328,000 in the same month a year ago.

The estimate of new houses for sale at the end of November was 286,000, representing 4.1 months of supply at the current sales rate. The months of supply is up from 3.6 months in October but down from 5.6 months a year ago.

On Tuesday, National Association of Realtors released a separate report showing existing home sales pulled back in November after moving sharply higher for five straight months.

NAR said existing home sales tumbled by 2.5 percent to an annual rate of 6.69 million in November after jumping by 4.4 percent to a revised rate of 6.86 million in October.

Economists had expected existing home sales to slump by 2.2 percent to a rate of 6.70 million from the 6.85 million originally reported for the previous month.


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

*U.S. Crude Oil Inventories Dip 0.6 Million Barrels In Week Ended 12/18

Trading 23 Déc 2020 Commentaire »

U.S. Crude Oil Inventories Dip 0.6 Million Barrels In Week Ended 12/18


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

*U.S. Consumer Sentiment Index Downwardly Revised To 80.7 In December

Trading 23 Déc 2020 Commentaire »

U.S. Consumer Sentiment Index Downwardly Revised To 80.7 In December


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

*U.S. New Home Sales Plunge 11.0% In November

Trading 23 Déc 2020 Commentaire »

U.S. New Home Sales Plunge 11.0% In November


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

U.S. Personal Income Slumps As Federal Assistance Winds Down

Trading 23 Déc 2020 Commentaire »

The Commerce Department released a report on Wednesday showing a steep drop in U.S. personal income in the month of November.

The report said personal income slumped by 1.1 percent in November after falling by a revised 0.6 percent in October.

Economists had expected personal income to dip by 0.3 percent compared to the 0.7 percent drop originally reported for the previous month.

Disposable personal income, or personal income less personal current taxes, also tumbled by 1.2 percent in November following a 0.7 percent decrease in October.

The bigger than expected drop in personal income came as federal economic recovery payments slowed as pandemic-related assistance programs continued to wind down.

The Commerce Department said personal spending also fell by 0.4 percent in November after rising by 0.3 percent in October.

Personal spending was expected to edge down by 0.2 percent compared to the 0.5 percent increase originally reported for the previous month.

Excluding price changes, personal spending still declined by 0.4 percent in November after rising by 0.3 percent in October.

"Despite the monthly contraction in spending, we expect real consumer spending will advance around 1.0% in Q4 (just over 4% annualized) supported by strong end-of-summer momentum," said Gregory Daco, Chief U.S. Economist at Capital Economics.

He added, "Still, the economy is entering 2021 with very little dynamism, and the urgency of passing the Covid relief package cannot be understated."

With income falling by much more than spending, personal saving as a percentage of disposable income dropped to 12.9 percent in November from 13.6 percent in October.


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

U.S. Durable Goods Orders Climb 0.9% Amid Jump In Orders For Transportation Equipment

Trading 23 Déc 2020 Commentaire »

Partly reflecting a jump in orders for transportation equipment, the Commerce Department released a report on Wednesday showing new orders for U.S. manufactured durable goods increased by more than expected in the month of November.

The Commerce Department said durable goods orders climbed by 0.9 percent in November after spiking by an upwardly revised 1.8 percent in October.

Economists had expected durable goods orders to rise by 0.6 percent compared to the 1.3 percent jump that had been reported for the previous month.

The bigger than expected increase in durable goods orders was partly due to continued growth in orders for transportation equipment, which surged up by 1.9 percent in November after shooting up by 1.5 percent in October.

Orders for defense aircraft and parts helped lead the leader higher, soaring by 15.7 percent in November after skyrocketing by 71.3 percent in October.

Excluding the jump in orders for transportation equipment, durable goods orders rose by 0.4 percent in November after surging up by 1.9 percent in October. Ex-transportation orders had been expected to increase by 0.5 percent.

Significant increases in orders for computers and related products and communications equipment were partly offset by a drop in orders for fabricated metal products.

The report said orders for non-defense capital goods excluding aircraft, a key indicator of business spending, rose by 0.4 percent in November after jumping by 1.6 percent in October.

"Core orders notched another gain last month, but signal moderating business investment growth," said Oren Klachkin, Lead U.S. Economist at Oxford Economics.

He added, "Factory output will stay well-supported in the new year, but the recovery's dynamics will favor a pickup in services activity at the expense of goods."


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