Analytics and trading signals for beginners. How to trade GBP/USD on December 29? Analysis of Monday. Getting ready for Tuesday

Trading 28 Déc 2020 Commentaire »

Hourly chart of the GBP/USD pair

analytics5fea2983e20c7.jpg

The GBP/USD pair crossed the upward trend line in the morning, which created a sell signal. Yesterday we marked 1.3471 and 1.3373 as target levels, the first of which was both reached and surpassed. Thus, if novice traders took profit near it, they could earn around 75 points. The sell signal is still relevant and those who have not yet closed the sale are now in profit of about 100 points. A new downward trend has formed for the pound/dollar pair, and the price was unable to update and/or overcome the previous local high of 1.3624. Thus, chances that a downward trend will be created in the short term has increased. We now expect the pair to fall to the $1.32 area. In order to be able to consider short positions again, you need to wait for the pair to correct and form a new sell signal. However, the pound may continue to move down without a correction. We still recommend being content with the profit you could get up to now.

Fundamentally, there is absolutely nothing to say now. The trade deal has been agreed upon between the UK and the European Union, but now there is little to do - it needs to be ratified by both sides. The British Parliament will deal with this issue on December 30 and, no doubt, will approve the deal. The European Parliament will vote for ratification after the New Year. In the meantime, the European Council has approved the so-called "provisional application", which allows the entry into force of an international agreement without ratification by the European Parliament. The fall of the British currency is now, from our perspective, fundamentally justified. The pound has been rising for a long time on the basis of only positive expectations on the London-Brussels talks. Now is the time to pay back your debts. The deal is good, but it does not remove all of the UK's economic woes. We estimate that the UK economy will lose about 2% of GDP in the fourth quarter, while the US will grow by a few percent. The British economy may lose around 1% in the first quarter of 2021, the Bank of England ascertains. Thus, not only is the pound overbought, but all forecasts speak in favor of the fact that the economy will contract. Well, technically, we have a signal for a downward trend.

No major macroeconomic reports or other events scheduled for Tuesday, December 29th. Thus, there will be no fundamental background, which does not mean the absence of movement for the pound/dollar pair.

Possible scenarios on December 29:

1) Buy orders have lost their relevance, since the price settled below the trend line. And so, the bulls have released the initiative and now we need to wait for a new upward trend in order to be able to trade up. Such a trend is unlikely to appear the next day.

2) Selling has now become relevant, but today the pair has already fallen by more than 100 points. Thus, the best solution would be to close short positions and wait for a new sell signal from MACD. You can also continue to keep sell orders open with targets at 1.3416 and 1.3345 until the MACD indicator turns up.

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 29? Analysis of Monday. Getting ready for Tuesday

Trading 28 Déc 2020 Commentaire »

Hourly chart of the EUR/USD pair

analytics5fea1a838b457.jpg

The EUR/USD pair rose by 60 points at night and in the morning, then dropped by the same amount for two hours in the afternoon, afterwards it calmed down and stabilized around the 1.2220 level. Since the pair's quotes settled above the downward trend line during the day (which is now indicated by a dotted line), novice traders could open long positions in order to get the price to settle above this area. We mentioned the 1.2254 level as a target. The price fell short by around 4 points and significantly dropped. Thus, novice traders could earn 20-25 points today, but they could also incur losses if they did not exit long positions in time. However, it was impossible to predict the drop in quotes at lunchtime. No important news that could support the dollar at that time. We warned that the holidays are not the best time to trade. The price can trade in any way, and it will be extremely difficult to predict its behavior. At the same time, we have the rising trend line at our disposal, which is now the only one in the chart. The price rebounded off it five times in total, but it is very difficult to say that an upward trend has now formed. Thus, formally, long positions have now become relevant at least until the price settles below the trend line.

No macroeconomic report from the European Union and the United States on Monday, December 28. And, in principle, there was no news, which is absolutely not surprising for the holiday period. Donald Trump signed the 2021 budget in America, which also includes a $900 billion stimulus package. However, this is not the kind of news that could affect the movement of the euro/dollar pair. In fact, this package can only exert additional pressure on the dollar, since it is not clear where the United States government will take almost a trillion dollars from. It is one thing to raise money, if you just print - then the supply of the US dollar in the foreign exchange market will grow and its rate may sink even more.

The US consumer confidence indicator will be published on Tuesday, which, you can be sure, will not have any impact on the pair's movement. Most likely, the "swing" will continue, which is to move in different directions. Or flat.

Possible scenarios on December 29:

1) Long positions have become relevant at the moment, since the pair surpassed the downward trend line, and the upward trend has been preserved. Thus, formally, we should now wait for the MACD indicator to discharge and create a new buy signal from it, afterwards you should consider opening new long positions while aiming for 1.2230 and 1.2245. Rebounding from the trend line can be used as a buy signal. But at the same time, there is a high probability that the pair will continue to move in different directions.

2) Trading for a fall does not seem appropriate now. In order to be able to re-examine sell orders, the price needs to settle below the rising trend line. In this case, you can open short positions while aiming for 1.2167 and 1.2152.

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 of EURUSD on 28.12. Euro keeps growing

Trading 28 Déc 2020 Commentaire »

analytics5fea125513cc0.jpg

EURUSD - The euro opened with growth, followed by a sharp decline - but then it rebounded.

We keep buying the euro from 1.2190.

Sell from 1.2130.

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

Two-Year Note Auction Attracts Below Average Demand

Trading 28 Déc 2020 Commentaire »

The Treasury Department announced the results of its auction of $58 billion worth of two-year notes on Monday, revealing the sale attracted below average demand.

The two-year note auction drew a high yield of 0.137 percent and a bid-to-cover ratio of 2.45.

Last month, the Treasury sold $56 billion worth of two-year notes, drawing a high yield of 0.165 percent and a bid-to-cover ratio of 2.71.

The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.

The ten previous two-year note auctions had an average bid-to-cover ratio of 2.57.

Later today, the Treasury is due to announce the results of its auction of $59 billion worth of five-year notes.


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

Euro Retreats Against Most Majors

Trading 28 Déc 2020 Commentaire »

The European currency eased off from its early highs against its most major counterparts in European trading on Monday.

The euro pulled back to 1.2191 versus the greenback and 1.0850 against the franc, off its early 6-day high of 1.2250 and near a 1-year high of 1.0892, respectively.

Against the yen and the loonie, the euro retreated to 126.37 and 1.5662, from its early 10-day high of 126.74 and a 4-day high of 1.5702, respectively.

The currency is seen finding support around 1.19 against the greenback, 1.05 against the franc, 125.00 against the yen and 1.54 against the loonie.


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

Pound Falls Against Majors

Trading 28 Déc 2020 Commentaire »

The pound weakened against its major rivals during the European session on Monday.

The pound depreciated to 4-day lows of 1.3474 versus the greenback and 0.9056 versus the euro, after rising to 1.3576 and 0.8986, respectively in early deals.

The pound reversed from its early highs of 140.57 against the yen and 1.2076 against the franc and dropped to 139.65 and 1.2003, respectively.

The currency is likely to target support around 1.31 versus the greenback, 0.92 versus the euro, 138.00 against the yen and 1.18 against the franc.


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

U.S. Dollar Rebounds Against Most Majors

Trading 28 Déc 2020 Commentaire »

The U.S. dollar erased its early losses against its most major counterparts in the European session on Monday.

The greenback recovered to 1.2191 against the euro and 103.71 against the yen, from its early 6-day low of 1.2250 and a 4-day low of 103.40, respectively.

The greenback hit a 1-week high of 0.8919 against the franc, from a low of 0.8884 seen at 5:00 pm ET.

The U.S. currency rebounded to 0.7578 against the aussie and 0.7099 against the kiwi, off its early 10-day lows of 0.7623 and 0.7139 respectively.

The greenback rose back to 1.2851 against the loonie, heading to pierce a 4-day high of 1.2860 set in the previous session. This may be compared to a low of 1.2814 hit at 4:45 am ET.

The next possible resistance for the greenback is seen around 1.19 against the euro, 106.00 against the yen, 0.92 against the franc, 0.71 against the aussie, 0.68 against the kiwi and 1.30 against the loonie.


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

USD turns bearish immediately after sudden growth. EUR/USD took the chance for a rebound

Trading 28 Déc 2020 Commentaire »

analytics5fea02db74bfd.jpg

On the eve of Christmas, investors again turned to the US dollar, which was in high demand due to the possible exit of Britain from the European Union under a "tough" scenario and uncertainty around the adoption of the next package of fiscal incentives in the United States.

This allowed the USD to move away from the lows for two and a half years, reached earlier in the area of 89.7 points, and become the strongest currency among the main competitors at the end of last week.

However, on Monday, the pressure on the protective greenback returned, as the threats that had previously troubled market participants receded into the background.

The risk appetite was spurred by reports that US President Donald Trump has finally approved the state budget for 2021, which includes a $900 billion economic aid package in response to the pandemic.

Investors welcomed the move as it restored unemployment benefits to millions of Americans and averted a federal government shutdown of the world's largest economy.

Against this background, global stock indexes rose, managing to recoup recent losses, while the greenback was forced to partially abandon its previous gains.

From the March highs of around 103 points, the US dollar has already retreated by more than 13%, falling to 90 points.

This year, low interest rates, as well as large-scale fiscal and monetary stimulus in the United States, primarily contributed to the fall in the USD.

Most experts agree that the greenback will continue to weaken. According to them, investors will abandon this "safe haven" against the background of mass vaccination against COVID-19, as well as the further easing of the Fed's monetary policy.

In addition, the United States has long been experiencing a budget deficit, and the depreciation of the US dollar, according to analysts, will have a positive impact on the attractiveness of national assets.

Taking advantage of the bearish market sentiment towards the US dollar, the EUR/USD pair tried to develop a rebound, pushing off from the weekly upward trend line in the area of 1.2185. However, the pair's rally quickly fizzled out near the 1.2250 level, which remains a strong resistance for now.

In general, the main currency pair is ready to test again the highs for two and a half years, noted earlier in December in the area of 1.2270-1.2275. From here, the bulls will open the road to 1,2300, 1,2340, and 1,2400.

Meanwhile, the inability of the latter to protect the above-mentioned upward trend line in the area of 1.2185 may provoke sales, which will throw the pair in the direction of 1.2130. Further drawdown will cancel out the bullish forecast and clear the way for a decline to 1.2060 and further to 1.2000.

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

December 28, 2020 : GBP/USD Intraday technical analysis and trade recommendations.

Trading 28 Déc 2020 Commentaire »

analytics5fe9fd9b577a8.jpgIn December, the price levels of (1.3380-1.3400) have prevented further bullish movement for the past few weeks.Bearish target was targeted around 1.3300. However, the pair has failed to pursue towards lower targets.Instead, a bullish spike was expressed towards 1.3480-1.3500 where the upper limit of the depicted movement channel has previously provided temporary bearish pressure on the pair.Shortly after, another bullish spike has recently been demonstrated towards 1.3600 where the upper limit applied considerable bearish rejection again.Recently, the GBPUSD pair looked overbought while consolidating above the key-level of 1.3400.As expected, bearish reversal was recently initiated around 1.3600. A quick bearish decline was demonstrated towards 1.3200.Intermediate-term outlook could turn into bearish provided that the pair maintains movement below 1.3400. However, the pair has failed to maintain bearish decline below 1.3200.Instead, bullish persistence above 1.3400 invalidates the bearish scenario for the short-term. Another bullish movement may be expressed towards 1.3700 (the channel's upper limit) where bearish rejection should be anticipated.

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

Gold Prices Edge Lower After Moving Up On U.S. Stimulus

Trading 28 Déc 2020 Commentaire »

Gold prices are edging lower Monday morning as investors look to pick up riskier assets such as equities following U.S. President Donald Trump signing a coronavirus relief package and government spending package.

Gold prices initially reacted positively to news about signing of the relief package by Trump. However, prices came off higher levels as stock markets in Asia and Europe gained in strength, buoyed by U.S. stimulus news and reports about a post-Brexit trade deal between the European Union and the U.K.

A slightly weaker dollar limits gold's weakness. The dollar index is down 0.1% at 90.22, after having slid to 89.98 earlier.

Gold futures for February fell to $1,881.10 an ounce before edging up slightly to $1,883.70 an ounce, gaining $0.50.

Despite its retreat from higher levels, gold manages to find support amid expectations the massive stimulus package will push up inflation.

On Sunday, U.S. President Donald Trump signed legislation for $900 billion in coronavirus economic aid and $1.4 trillion in government spending, providing support for millions of Americans and averting a government shutdown. He had earlier threatened to block the package.

"I am signing this bill to restore unemployment benefits, stop evictions, provide rental assistance, add money for PPP, return our airline workers back to work, add substantially more money for vaccine distribution, and much more," Trump said in a statement.


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