Wave analysis of EUR/USD and GBP/USD for July 19, 2019

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EUR / USD

On Thursday, July 18, trading ended with a 50 bp rise for the EUR / USD pair. Thus, the proposed correction after July 9 is delayed, but the current wave marking still involves building a new downward wave, presumably 3. At the same time, until a successful attempt to break through the minimum of wave 1 or the minimum of wave 2 or b, the option with the complication of the supposed wave with . Thus, I recommend selling the euro-dollar instrument below the indicated minimums. The news background, from my point of view, is definitely not in favor of the euro. Foreign exchange markets have come to terms with the fact that the ECB will also reduce the key rate, which will now become a minus sign. Markets await the resumption of the quantitative incentive program. Markets are waiting for a change in the head of the ECB. Markets do not expect acceleration of inflation and economic growth. From the current news and economic reports there is nothing to highlight on Friday. This is a good opportunity for bears to start selling Eurocurrency again. Although with this, the forex market can wait until next week, when the ECB meeting will be held.

Purchase goals:

1.1412 – 0.0% Fibonacci

Sales targets:

1.1106 – 100.0% Fibonacci

1.1025 – 127.2% Fibonacci

General conclusions and trading recommendations:

The euro-dollar pair still holds hopes for the upward trend. I still recommend small purchases of the euro, or simply remain in previously open purchases, with targets located near the estimated mark of 1.1412, which is equal to 0.0% Fibonacci, and an order restricting possible losses, under the minimum of wave 2 or b. Leaving the tool below the mark of 1.1181 will indicate that the tool is ready to build a downward trend.

GBP / USD

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The GBP / USD pair increased on July 18 by 115 basis points, which fully corresponds to the current wave pattern, which implies the completion of the construction of wave e, the completion of the construction of the downward trend. If this is indeed the case, then at least I am waiting for the pound-dollar tool to build three waves up or to the side, which is also possible. The main opponent of the pound is now the news background. All events in the UK do not contribute to the growth of the pound sterling in the foreign exchange markets. For example, yesterday, the Parliament of Great Britain voted for blocking a possible suspension of Parliament’s work, which Boris Johnson had previously allowed in order to make a decision to withdraw from the European Union without a deal on his own. Now, he will not be able to make such a decision, bypassing Parliament. However, what now with the election promises of the country’s “no-5-minute prime minister”? After all, he promised new negotiations with the EU, which will not happen, and the exit from the block on October 31, which is now also not a fact that it will be implemented. In general, the situation gets more confusing more and more each day.

Sales targets:

1.2334 – 200.0% Fibonacci

1.2194 – 261.8% Fibonacci

Purchase goals:

1.2783 – 0.0% Fibonacci

General conclusions and trading recommendations:

The wave pattern of the pound / dollar instrument assumes the completion of the construction of the downward wave e. Thus, I recommend small purchases of a pair with targets located around 28 figures and with an order restricting losses under the minimum of wave e. I do not recommend to return to sales yet.

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

Source:: Wave analysis of EUR / USD and GBP / USD for July 19. Boris Johnson’s election promises are blocked by the European Union




USD/JPY. Japanese inflation disappointed, but the southern trend has not exhausted itself

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Yesterday, the US currency sharply depreciated throughout the market, responding to unexpected comments by the head of the Federal Reserve Bank of New York, John Williams. In just a few hours, the dollar index dropped from 96.86 points to 96.35 points, showing a general weakening of the currency. During the Asian session, the dollar somewhat regained its position, but the very fact of such a situation suggests that the position of dollar bulls is precarious – even careful verbal interventions can stop the growth of the greenback.

It is noteworthy that Williams quite diplomatically voiced his concern about the current situation in the country’s economy and hinted rather at the need to ease monetary policy. He said that he considered it expedient to apply preventive measures on the part of the Fed in order to “solve the existing problems” and not to deal with their consequences later. But these words were enough for the market to make the appropriate conclusions for themselves: according to traders, the Fed representative signaled a rate cut at the July meeting once by 50 basis points.

The Federal Reserve Bank of New York clearly did not expect such a violent market reaction to the comments of their boss. Therefore, soon after his speech, the release of the FRB press service appeared, which explained Williams’s position. The Federal Reserve Bank stated that he voiced only a “scientific approach” to the problem, and did not announce the next steps of the Fed. After that, the dollar won back a little, although traders are still wary of the prospects for its growth. The fact is that yesterday, at almost the same time, another representative of the Fed spoke – Richard Clarida. He also called on members of the regulator “to be proactive,” as current economic growth needs support from the Fed. In other words, the likelihood of “aggressive mitigation” by the Fed is still not worth discounting, although after the last macroeconomic releases (Nonfarma, inflation, retail sales) the market has eased its concern about this. In my opinion, this is a very untimely decision.

And yet, the fact remains that the dollar is still “on horseback”, although it cannot demonstrate a large-scale rally. There is uncertainty about the prospects for US-China relations, as well as background fear about possible currency interventions initiated by Trump, muffle the ambitions of dollar bulls. But the current situation can be used in trade, especially in the dollar-yen pair. The usd / jpy pullback provides a tempting opportunity to open short positions in a pair. Given the growth of geopolitical tensions, as well as the dovish intentions of the Fed, it can be assumed that the current correction will be temporary – after its completion, the price will again go to the base of the 107th figure, or to be more precise, to the resistance level of 107.05 (lower Bollinger Bands indicator line on the daily chart).

At the end of June, the bears for usd / jpy currency pair had already tested this resistance level, and even updated the annual minimum, dropping to 106.80. However, against the background of optimistic statistics from the USA, the pair could not develop a further downward trend and returned to the range of 107.70-108.80. In the near future, a retest of the above resistance level is likely, even with a likely renewal of the annual minimum.

It is worth noting that today’s price pullback usd / jpy is associated not only with the recovery of the US currency. The yen is under pressure and has its “own” problems. The fact is that today key inflation indicators were published, which demonstrated its slowdown. And although all the indicators came out at the forecast level, the Japanese currency still negatively reacted to this release. Basic inflation disappointed most of all – the consumer price index excluding prices for fresh food products is falling at a fairly sporting pace. If in April this indicator was at the level of 0.9%, in May it was 0.8%, and in June – already at around 0.6%. The structure of the published indicators suggests that inflation has slowed, mainly due to a sharp decline in energy prices and a reduction in mobile communication tariffs by the main Japanese operators.

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It is logical to assume that the fact of the fall in core inflation to the levels of 2017 will not be ignored by the Bank of Japan, whose representatives have repeatedly stated that they are still ready to expand incentives. According to some experts, the Japanese regulator realizes his intentions already at the July meeting, although according to other analysts, the main events in this context will unfold in September. The fact is that the meeting of the Japanese regulator will be held just a day before the Fed meeting (July 30 and 31, respectively). As many currency strategists believe, the Bank of Japan will not take drastic steps until the Fed has announced its verdict on the prospects for monetary policy. In other words, at the July meeting, the Japanese Central Bank may announce its actions,

Thus, as soon as the first reactions regarding the weak inflation in Japan have subsided, geopolitics will again be in the spotlight of usd / jpy traders. Increased tensions in the Middle East (primarily through the US-Iran line), an increase in the likelihood of a “tough” Brexit, a political crisis in Italy and vague prospects for trade negotiations between Washington and Beijing are a brief list of the fundamental factors that will support the Japanese currency (for account of its status as a protective asset) and, accordingly, pressure on a pair of usd / jpy. Under such conditions, a repeated assault on the resistance level 107.05 is very likely.

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

Source:: USD / JPY. Japanese inflation disappointed, but the southern trend has not exhausted itself




Head of the Federal Reserve Bank of New York John Williams brought hope to the markets

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World markets continue to throw in the cold, then in the heat against the backdrop of the uncertainty of the future actions of the Fed in the matter of monetary policy.

In recent weeks, in the wake of positive data from the labor market, as well as a slight increase in US inflationary pressures in the markets, investors began to doubt that after lowering the key interest rate by 0.25% following the July meeting, the regulator will continue to reduce it without stopping, It is called, attained. But yesterday’s largely unexpected statement by the President of the Federal Reserve Bank of New York, J. Williams, again stirred up financial markets and allowed its participants to once again hope that the Central Bank will ignore the latest positive signals and may begin a cycle of lower interest rates for the first time in 10 years.

In recent weeks, investors have started to doubt that after a 0.25% decline in the key interest rate as a result of the July meeting in a wave of positive labor-market data, as well as a slight rise in US inflation pressure in markets. The regulator will continue to reduce it without stopping what is called the”what’s at stake”. However, the statement by the New York Fed President, John Williams has once again expanded the financial markets, which allows participants to hope again that the CBO will ignore the latest positive signals and could begin the first-ever interest-rate-reduction cycle in 10 years.

On this wave, the US dollar was under pressure and even began to decline in relation to the single European currency, which in recent months turned into a steady-state as an outsider amid signals of a recession in the eurozone as a whole and in Germany in particular. The news led to a sharp decline in the yield of American treasuries. Therefore, the benchmark yield of 10-year-old treasuries fell, approaching the key psychological level of 2.0% and the major US stock indices switched from negative to positive territory.

So what is so unusual about the representative of the Fed? Speaking at the meeting of the Central Bank Research Association, he said that the current level of interest rates is not so high that the regulator takes a long period of time. He made it clear that it is necessary to act in the presence of the first signs of problems in the economy. Moreover, in his opinion, lowering the yield of government bonds of the US Treasury will reduce the burden on the Fed and more favorable financial conditions will help disperse inflation.

Markets responded sharply with rising demand for neither risky assets and dollar sales, finding that on July 31 (the day following a meeting of the Central Bank) it could cut off rates by 0.50% instead of the expected decrease by 0.25%. The markets reacted so sharply because the New York Fed is considered the most influential Reserve Bank in the overall structure of the Fed. In addition, investors simply could not respond to his words that “it is better to take preventive measures than to wait until the catastrophe begins.”

Evaluating the abrupt change in market sentiment, we believe that today the local weakening of the dollar will continue amid rising demand for risky assets.

Forecast of the day:

The AUD/USD pair remains in a short-term uptrend. Before continuing growth, it can be adjusted down to 0.7040 and we expect the pair to continue rising to 0.7140.

The NZD/USD pair can also be adjusted to the level of 0.6745 before continuing to climb to 0.6800.

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

Source:: Head of the Federal Reserve Bank of New York John Williams brought hope to the markets (We expect continued growth of AUD/USD




GBP/USD: plan for the European session on July 19, 2019

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

Yesterday, a good report on retail sales in the UK set a bullish tone for the market, and news of an alternative proposal from the EU on the problematic issue of the North Irish border continued the upward momentum. Now, the bulls are aimed at holding GBP/USD above the intermediate support of 1.2514, where the formation of a false breakout will be the first signal to continue opening long positions. However, the main task of the pound buyers will be to break and consolidate in the first half of the day above the resistance of 1.2561, which will retain the upward potential and lead to an update of the highs in the area of 1.2600 and 1.2639, where I recommend fixing the profit. In the scenario of a pair falling below the level of 1.2514, it is possible to open long positions immediately for a rebound in the support area of 1.2472.

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

Today, sellers remain to protect the resistance of 1.2561, and the formation of a false breakdown there in the first half of the day will be a signal to open short positions. However, the main task of the bears will be to return and consolidate below the support of 1.2514, which will push the GBP/USD to the area of the lows of 1.2472 and 1.2431, where I recommend taking the profits. Today, no important reports on the UK are planned, so traders will closely follow the new statements of the EU representatives on the topic of Brexit.

Indicator signals:

Moving Averages

Trading is conducted above 30 and 50 moving averages, which indicates the preservation of the upward correction in the pair.

Bollinger Bands

The growth of the pound will be limited by the upper limit of the indicator around 1.2585, where you can watch sales in the morning. The break of the average border of the indicator in the area of 1.2514 will lead to a larger decrease in the pound to the lower border, which is located in the area of 1.2470.

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

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

Source:: GBP/USD: plan for the European session on July 19. Good news on Brexit and the North Irish border are pushing the pound up




EUR/USD: plan for the European session on July 19, 2019

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To open long positions on EURUSD, you need:

Yesterday’s statements by the fed Fed representatives on the necessary lowering of interest rates were misinterpreted by the market, which led to the sale of the US dollar. However, then the situation stabilized, and a number of lost positions were quickly returned by sellers. At the moment, the situation is on the side of euro buyers. A false breakout in the support area of 1.1241, which may coincide with the release of the report on the balance of the eurozone current account, will be the first signal for opening long positions, but the main goal of the bulls will be the resistance of 1.1280-85, above which it is not possible to break through from July 10. It was then that this level was missed by buyers. The breakout of 1.1280 will lead to the update of highs in the area of 1.1311 and 1.1338, where I recommend taking the profit. In the scenario of decline under the support level of 1.1241, it is best to open long positions on the rebound from the large support of 1.1214.

To open short positions on EURUSD, you need:

Sellers will try their best to keep the resistance at 1.1280, and if there is no unexpected news on the rates from the Fed or the ECB, most likely, the growth of the pair will be limited at the end of this week. A false break in this range will be a signal to open short positions in the euro, but the main task of the bears is to return to the support level of 1.1241. A number of fundamental data planned for the second half of the day can help sellers reach the support of 1.1214, where I recommend fixing the profits. In the EUR/USD growth scenario in the first half of the day above the resistance of 1.1280, it is possible to open short positions immediately for a rebound in the area of the maximum of 1.1311.

Indicator signals:

Moving Averages

Trading is conducted above 30 and 50 moving averages, but we can talk about the resumption of the bullish trend only after the breakdown of the resistance of 1.1280.

Bollinger Bands

The growth of the pair in the first half of the day will be limited by the upper limit of the indicator in the area of 1.1295, while buyers, in the case of a decline in EUR/USD, will return to the market only after the test of the lower limit in the area of 1.1215.

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

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

Source:: EUR/USD: plan for the European session on July 19. Traders overestimated the likelihood of the Fed lowering the interest




Currency Crises – Causes, Effects & Examples

A currency crisis is when there is a sharp depreciation (or at times, an appreciation) in the value of a currency.

When a currency crisis occurs, it can have a significant impact which can affect all spheres of the economy, including the day to day lives of regular people.

A currency crisis is something that is not new. There are many examples of it in recent history, from the Russian ruble to the Turkish lira and many more. Despite the numerous incidents, the reasons behind currency crises can vary significantly.

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When a currency crisis occurs, there is extreme volatility. This often draws the attention of speculators as well as central banks. Reasons range from a monetary policy that follows a fixed exchange rate, to economic failures and political crisis.

When a currency crisis occurs, it comes unannounced. One could draw a relation to a currency crisis as a black swan event. Yet, in most cases, in hindsight, the causes for it can be easy to explain.

Some currency crises tend to have a short-term impact, while many other types tend to last longer, sometimes for years.

Most Common Types of Currency Crises

There are a number of reasons for a currency crisis to occur. They can be categorized into the following:

Inflation

Inflation remains the single biggest threat to currencies. Typically, central banks are mandated to maintain price stability. But, depending on the circumstances, inflation can start to creep higher. Examples of inflation leading to currency crisis include the famous inflation in Zimbabwe and the more recent episode in Venezuela.

Debt

It is often said that debt fuels the economy. Under general circumstances, governments tend to keep a close watch on the amount of borrowing in the economy. When lenders learn about potential factors that could lead to a cut in the credit ratings, the borrowing costs rise. This can eventually lead to a freeze in borrowing due to the higher interest rate demand by lenders.

Political stability

Currency crisis can occur due to political reasons as well. An economy needs to have a stable political environment. This is good for overseas investors as well as for the economy to grow. When there is political infighting or riots against the government, it can lead to instability. This, in turn, spurs foreign investment coming into the economy, resulting in an indirect impact on the currency’s value.

Economic Factors

The global economy also plays a role in the currency crisis. When there is a faltering economy, central banks respond by lowering interest rates. The open markets set the value of an exchange rate in a free-floating exchange rate policy. This can get difficult in case an economy is following a fixed rate regime. Defending the exchange rate peg can become a costly affair.

Examples of Currency Crisis

1998, RUB Crisis

In 1998, the currency crisis hit Russia. Known as the ruble crisis, the nation had to devalue its exchange rate. One of the reasons that led to the crisis was falling productivity amid a higher fixed exchange rate. The Russian central bank had to intervene in the markets to devalue its currency as a result. The crisis got to a point that Russia had to seek loans from the International Monetary Fund.

2015, CHF De-peg

In 2015, the Swiss National Bank shocked the FX markets by announcing that it will de-peg the EUR and the CHF exchange rate. The SNB had, for years, maintained a floor on the EURCHF exchange rate. For a currency that was pegged to the euro, the CHF appreciated more than 30% on the day. This was unprecedented because currency crises typically lead to a devaluation of the currency.

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EURCHF Currency depeg

2018, TRY Devaluation

In 2018, the Turkish lira made headlines. With high inflation and rising borrowing costs, the Turkish lira was embroiled in a currency crisis. Alongside the economic factors, the government was also partly responsible.

The Turkish government began to wield its influence on the Turkish central bank, further adding to the chaos. The TRY became strongly devalued as it fell to 4 USD per Turkish lira. The exchange rate was about 1.34 USD/TRY back in 2005.

USDTRY Currency Crisis, 2018USDTRY Currency Crisis, 2018
USDTRY Currency Crisis, 2018

The impact of the devaluation in the Turkish lira also reached across shores into Europe. Because Europe had a significant amount of investment in Turkey, the currency crisis led to a decline in European equities as well.

In conclusion, currency crises can impact any economy, regardless of it being a developed or an emerging market. However, one could always look back in history to see how the economies have handled their respective currency crises.

While volatility is often low in the FX markets, a currency crisis can deeply affect the exchange rate. Money is the basis for the financial world. And, as a result, the impact is felt far and wide.




AUD / USD: Labor market pleased the Australian, the next stop is at 0.7060

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The Australian labor market data released today has supported the Australian dollar. This allowed the AUD/USD bulls to remain within the 70th figure, although their position looks rather unstable. However, the price overcame the key resistance level at the end of last week, which allows the buyers to go further towards the borders of the 71st figure. So far, it’s too early to talk about such price heights, given the wave-like interest of traders in the US currency and the ambiguous abstracts of the minutes of the last meeting of the Reserve Bank of Australia.

By the way, today’s release is also ambiguous. The unemployment rate turned out to be at the forecast level of 5.2% and at this point, the indicator is already out for the third month in a row. I recall that at the beginning of the year unemployment was at the level of five percent. In February, it declined to 4.9% but then stabilized at around 5.2%. However, the increase in the number of employees came out in the “red zone”. After substantial growth in May (+45 thousand) and rather weak forecasts for June (+9 thousand), the indicator showed a completely ugly result at first glance with the figure of +0.5 thousand. However, considering the structure of this indicator, we can conclude that not everything is so bad.

The fact is that the negative dynamics of employment growth was only due to the reduction in part-time employment. This component collapsed by 20.6 thousand but on the contrary, full employment showed a positive trend, rising by 21.1 thousand. This trend may have a positive impact on the dynamics of wage growth since full-time jobs tend to offer higher wages and a higher level of social security. The share of the economically active population was also at a fairly high level as the indicator remained at its annual maximum of 66%, repeating the success of the month before last.

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In addition to data on the labor market, other releases have helped the Australian dollar today. In particular, we are talking about the indicator of confidence in the business environment of NAB (National Australia Bank). According to experts of this largest Australian bank, consumer confidence increased by 6 points in the second quarter. This is despite the fact that the indicator has consistently and quite rapidly decreased over the past four quarters. Also, it turned out to be in the negative area in the first quarter of this year for the first time in many years. This result is due to the period of “thaw” in relations between the United States and China, as well as the significant increase in the commodity market, primarily, iron ore.

In general, the releases published today are positive. It is worth noting that under the current conditions each publication with a “plus sign” is important. By lowering the interest rate at the beginning of June (for the second time in half a year), the Reserve Bank of Australia made it clear that further steps by the regulator will depend on the incoming data, especially in the labor market. There is also no consensus among experts on the third rate cut before the end of this year. Therefore, the figures released today allow us to hope that the balance of the RBA will be inclined to the option of a waiting position.

Returning to the RBA protocol published last week, two nuances are worth noting. First, the regulator acknowledged that the effect of monetary policy easing “is unevenly spread across different households”. Secondly, the Central Bank sees the need to improve the situation on the labor market primarily in the context of wage growth. All of these suggest that the next reduction in interest rates will be a difficult decision for the RBA given the presence of “side effects”. While the growth of full employment in June is intended to correct the situation with a weak increase in wages towards improvement.

In other words, the Australian quite reasonably reacted to them with growth despite the apparent ambiguity of the figures published today. In addition, “Aussie” receives background support from the commodity market. The cost of iron ore is still above $120 per ton. Iron ore futures on the Dalian commodity exchange rose this week by 1.1% to 131.63 dollars per ton. Earlier this week, growth reached 3.3% and the price increased to a record high since December 2013. It is worth recalling that the mining sector in Australia is 10% of GDP, and the economic sectors that are associated with mining (where iron ore occupies a central place) account for another 9% of GDP.

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Thus, the AUD/USD pair quite “deservedly” consolidated within the 70th figure, although further growth (for the time being) is limited by the nearest resistance level of 0.7060, which is the top line of the Bollinger Bands indicator on D1). Further large-scale growth of the pair depends only on the behavior of the US currency, which as a result, depends on the next steps of the Fed and (possibly) the White House. Rumors that Donald Trump will decide on foreign exchange interventions are increasingly being discussed among experts. Hence, this scenario cannot be ruled out, especially if the Fed takes a “not enough dovish” position at its July meeting. The support level for the AUD/USD pair is the mark of 0.6940, which is the lower limit of the Kumo cloud on the daily chart.

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

Source:: AUD / USD: Labor market pleased the Australian, the next stop is at 0.7060




Analysis of NZD/CHF for July 18, 2019

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The New Zealand dollar has managed to regain certain momentum against the Swiss franc recently which lead the price above 0.6625 area with a daily close. New Zealand has recently published upbeat economic reports, so NZD has every chance of extending gains against CHF in the coming days.

The quarterly CPI report of New Zealand was published this week, showing an increase to 0.6% from 0.1% due to higher prices for petrol and rent. On the other hand, the producer price index of Switzerland decreased to -0.5% from 0.0% which was against the expectation of 0.1%. The decline is mainly due to the lower prices for petroleum products, petroleum, and natural gas as well as basic metals and semi-finished metal products. The RBNZ reduced the interest rate to a record low of 1.5%, opting not to catch up with RBA’s 1.25%. However, the bank kept the door open for easing in August. The RNBZ pointed out that the risks related to trading activity strengthened but the downside risks remained unchanged to the employment and inflation outlook. The RBNZ is expected to converge with the RBA over time, depending on the incoming data.

Tomorrow, New Zealand’s Credit Card Spending report is going to be published which is expected to increase from the previous value of 6.6%.

On the other hand, the Swiss economy has printed solid economic statistics. The SNB has a plan of a rate cut if the FX interventions fail to dampen the upward pressure on CHF. The inflation target of the SNB is 0.7% on a yearly basis which is 0.1% up from last quarter’s projection. The price level of the whole range of domestic and imported products fell by 1.4%, compared with June 2018. The unemployment rate was above the expectation of 2.4% but remained unchanged with the previous value of 2.3%. At the end of June 2019, 97,222 unemployed were registered at the regional employment agencies (RAV). Today, the trade balance report is going to be published which is expected to decrease from 3.41B to 3.21B.

As of the current scenario, CHF is having bearish expectations while NZD is expected to regain momentum in the coming day thanks to better-than-expected economic reports from New Zealand. Though the price has been impulsive with the recent bullish run, certain correction may be observed if CHF manages to pull back certain positive outcomes.

TECHNICAL OVERVIEW:

The price has managed to retest the 0.6625 area after breaking it recently with a daily close. It indicates further upward pressure is in the making. The dynamic level of 20 EMA has been carrying the price since it bounced off the 0.6500 area and as the price remains above 0.6625 area with a daily close, the it is expected to move higher towards 0.6725 and later towards 0.6800 resistance area in the coming days.

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

Source:: Analysis of NZD/CHF for July 18, 2019: NZD to rise breaking CHF barrier?




EUR/USD: plan for the European session on July 18, 2019

To open long positions on EURUSD, you need:

Buyers were able to gain a foothold at 1.1227, and as long as the trade will be conducted above this range, the demand for the euro will remain. The formation of a false breakout in this area will be a signal to open new long positions in order to update the maximum of 1.1261 and then exit to a large resistance of 1.1286, where I recommend taking the profit. In the scenario of the euro falling under the support of 1.1227, against the background of the lack of fundamental statistics on the eurozone, it is best to return to long positions on the rebound from the low of 1.1195.

To open short positions on EURUSD, you need:

Bears will be more active after the correction from the high of 1.1261, but the main task will be to return to the level of 1.1227, which will retain the downward potential in the pair and lead to the second wave of decline in the area of the monthly low of 1.1195, where I recommend taking the profit. If a serious return to the market of sellers from the resistance of 1.1261 will not be noticed, then I recommend postponing the short positions to the test of the maximum of 1.1261.

Indicator signals:

Moving Averages

Trade is conducted above the 30 and 50 moving averages, however, it is still quite early to talk about a change in the market trend.

Bollinger Bands

The break of the average border of the indicator in the area of 1.1227 may return new sellers to the market, but the downward potential in the first half of the day will be limited to the lower limit in the area of 1.1215.

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

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

Source:: EUR/USD: plan for the European session on July 18. Bears let go of the market a little, but it’s too early to talk about




GBP/USD: plan for the European session on July 18, 2019

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

Yesterday’s rebound from the support of 1.2383 led to a large upward wave. Now, the buyers of the pound formed the support of 1.2417, and while trading will be conducted above this range, the demand for GBP/USD will remain, but the main goal is to break the resistance of 1.2452. Only a consolidation at this level will increase demand, which will lead to an update of the maximum of 1.2498, where I recommend fixing the profits. A more optimal scenario for opening long positions in the pair will be a false breakout in the morning in the support area of 1.2417. You can buy GBP/USD only on a rebound from the lower border of the side channel of 1.2383.

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

In the first half of the day, you can look at the short positions on the false breakout in the area of 1.2452, but larger sellers will probably wait for the test of the maximum of 1.2498, where they will try to form a new border of the downward channel. The main task of the bears will be to break through and consolidate below the support of 1.2417, which will push the pound back to the minimum of the month in the area of 1.2383, where I recommend taking the profits.

Indicator signals:

Moving Averages

Trading is conducted above 30 and 50 moving averages, which indicates the preservation of the upward correction in the pair.

Bollinger Bands

The breakthrough of the lower limit of the indicator in the area of 1.2417 may increase the pressure on the pound.

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

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

Source:: GBP/USD: plan for the European session on July 18. Bulls attack or sellers take profits?