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Post by instaforexgertrude on Apr 25, 2023 23:32:51 GMT -5
Forecast for EUR/USD on April 26, 2023EUR/USD The euro did not take the chance to overcome the nearest peak of April 14 at 1.1076, and so its high was 1.1068. Thus, there will be no divergence. In this case, the growth of the last five days takes on the role of correction from the fall of April 14-17. The price clearly shows the intention to reach the support of the MACD line, coinciding with the low of April 17 at 1.0910. When the price reaches this target, the Marlin oscillator will already be in negative territory, which will help in overcoming this level to attack the lower support of 1.0872 - on the embedded line of the green downtrend channel.  The First Republic Bank reported a loss of 102 billion in client funds. The bank's shares collapsed by 49.38%, pulling the S&P 500 down by 1.58%. Yields on US government bonds fell, and the market probability of the Federal Reserve raising the rate by 0.25% next week also decreased (76.2% vs. 88.1% the day before), but markets are already preparing for a new wave of crisis (in the US), which is expected to start this summer. The dollar will strengthen in this crisis, as demonstrated yesterday, in the role of a protective asset. On the four-hour chart, the price has consolidated below the MACD indicator line, and the Marlin oscillator has moved towards the decline. I expect the price to fall to the nearest target of 1.0910. However, market participants are waiting for comments from the Fed representatives regarding the current situation, so despite the technical prerequisites, we do not expect a significant decline until May 3rd.  Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on Apr 27, 2023 0:22:50 GMT -5
Forecast for GBP/USD on April 27, 2023GBP/USD The British pound continues its sideways movement in anticipation of the FOMC meeting next week. The upper limit of the range is the April 14th peak at 1.2545. Breaking through it will extend growth to 1.2598. Slightly higher is the second target level of 1.2666 – the peak of May 2022.  A sign of further price growth is the Marlin oscillator, turning upwards from the zero line – from the limit of the area of the downtrend. If the price falls, the range will end with overcoming the MACD line (1.2342).  On the four-hour chart, the price has consolidated above the indicator lines, and the signal line of the Marlin oscillator is in the positive area. The pound has a good chance of surpassing yesterday's peak. Especially if today's US GDP data turns out to be lower than forecasted. Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on Apr 27, 2023 22:32:27 GMT -5
EUR/USD. "The specter of stagflation": the US economy weakens, inflation growsThe American economy in the first quarter disappointed, but the dollar is strengthening its positions across the market, including the euro pair. After impulsive growth to the middle of the 10th figure, the EUR/USD pair turned 180 degrees and headed south. At the moment, bears are testing the nearest support level of 1.1000, corresponding to the Tenkan-sen line on the daily chart. Such an anomalous, at first glance, reaction of the greenback is due primarily to the strengthening of hawkish expectations regarding the Fed's further actions. The dollar is growing amid the threat of stagflation in the US, as today's release shows that consumer spending is still strong, and inflationary pressure remains at an unacceptably high level. In the language of dry numbers US GDP growth in the first quarter of this year was almost twice as bad as expected. According to forecasts, the US economy was supposed to grow by 2.0%, reflecting a downward trend (in the fourth quarter of 2022, growth was recorded at 2.6%). However, GDP volume increased by only 1.1%, which is much lower than economists' expectations. Notably, after the publication, the likelihood of a 25-point increase in the Fed's interest rate at the May meeting rose to 82%. That is, the market is virtually confident that the regulator will increase the rate to 5.25% next week, despite the "red hue" of the headline indicator in today's report.  As they say, the devil is in the details. The release structure shows that the US economy is slowing down amid high inflation. For example, the GDP price deflator in the first quarter increased by 4.0% YoY, while economists expected this component to grow by 3.7% YoY (I recall that in the fourth quarter, the indicator grew by 3.9% YoY). The core GDP price deflator in the first quarter was also in the "green zone," rising by 4.9% YoY, with a forecast of 4.7% YoY growth (fourth quarter result – 4.4% YoY). That is, consumer spending, which accounts for a large part of GDP, grew at the highest rate since the second quarter of 2021; the volume of government spending increased at the highest rate since the beginning of the year before last. What the release says It should be recalled that the core consumer price index excluding food and energy prices in March started to gain momentum again. In annual terms, the indicator rose to 5.6% in March. Over the previous five months, the core CPI had been declining – from 6.6% (in September 2022) to 5.5% (in February 2023). For the first time in the last six months, the growth rates of the core index accelerated. At the same time, overall inflation, the producer price index, the import price index – all these inflation indicators came out in the "red zone," reflecting active downward dynamics. In other words, all conditions for another round of the Fed's interest rate hike have been met today. The "last puzzle" will be the publication of core PCE inflation indicators (the release is scheduled for tomorrow, April 28). If Friday's numbers also come out in the green zone, the results of the May meeting will be virtually predetermined. Indirect support for the greenback was provided by the US labor market data released today. It turned out that the number of initial jobless claims increased by 230,000 last week. The indicator showed an upward trend for two weeks in a row (+240, +246 thousand), but a decline was recorded today. However, the US housing market continues to disappoint dollar bulls. It became known today that the volume of pending home sales in the US in March fell by 5.2% (in monthly terms), with a forecast of 0.8% growth. In annual terms, transactions fell by 23.2%, compared to analysts' forecast of a 22.8% decline. I recall that earlier released reports in this area also reflected negative dynamics. In particular, the volume of home sales in the secondary market in March decreased by 2.4% (the weakest result since November 2022). The indicator of building permits issued in the States in March fell by 8.8%, indicating that the high cost of borrowing is putting pressure on this sector of the economy. Conclusions The GDP growth report published today reflects the threat of stagflation in the US: the country's economy is growing at a weak pace, while inflationary components are gaining momentum. Therefore, today's release de facto ended up on the side of the dollar, as it strengthened investors' confidence that the Federal Reserve will indeed decide on another rate hike. At the same time, this fact is already largely priced in, so the current strengthening of the greenback is likely to be temporary. It should also be recalled that on the eve of the May meeting, another bank in the US (with a market capitalization of $1.06 billion) was on the verge of collapse. First Republic, whose securities fell by almost 50%, risks repeating the fate of Silicon Valley, Signature Bank, and Silvergate. The bank reported that clients withdrew $100 billion from accounts, and deposits decreased by more than 40%. In light of such news, the Federal Reserve is unlikely to be aggressive next week, so as a result of the May meeting, the dollar may come under strong pressure, even despite the fact of a 25 basis point rate hike. Thus, in my opinion, it is advisable to use southern price pullbacks on the EUR/USD pair to open long positions with the first target at 1.1050 (upper Bollinger Bands line on the daily chart) and the main target at 1.1100. Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on Apr 30, 2023 22:02:31 GMT -5
Forex Analysis & Reviews: High inflationary pressure forces the Fed to continue raising ratesEuro and pound decline on news that two key inflation indicators showed sustained pressure in the US in recent months, supporting the case for a new interest rate hike by the Federal Reserve System next week. The Personal Consumption Expenditures (PCE) price index, excluding food and energy, the Fed's preferred core inflation measure, rose 0.3% in March compared to the previous month and 4.6% compared to a year earlier. The Commerce Department report also said that the employment cost index, which the Fed also closely monitors, rose 1.2% in the first quarter compared to the previous period, exceeding economists' forecasts.  I would like to remind you that the main goal of the Fed is a 2% level, which is measured by a broader indicator, but the regulator considers the core indicator as a better indicator of the trend. Price data, especially in combination with rising labor costs, confirm expectations that Fed policymakers will continue to raise interest rates, raising them by another quarter of a percentage point at next week's meeting. A positive aspect in the PCE report was the slowdown in the growth of service costs. Thus, service prices, excluding housing, rose only 0.2% in March. However, in annual terms, the indicator remains elevated at 4.5%. Despite this, there are concerns that persistent inflation in the service sector, partly driven by strong wage growth in these industries, risks keeping price growth above the Fed's target indicator in the foreseeable future. As for further benchmarks, since it is obvious that the Fed will raise rates at the May 2-3 meeting, many expect the regulator to then take a long pause, but the latest data allow for a more aggressive approach that the committee could use as early as next week. Personal consumption expenditures, adjusted for prices, remained unchanged last month, reflecting reduced spending on goods and moderate spending on services after a revised 0.2% decrease in February. The decline in consumer spending indicates that households are becoming more cautious and cutting purchases.  As for income, it grew by 0.3%. Real wages also grew by 0.3% for the month. The saving rate jumped to 5.1% - the highest level since the end of 2021. Regarding the technical picture of EURUSD, the bulls still have a chance to continue the growth. To do this, they need to stay above 1.1000 and take control of 1.1030. This will allow them to move beyond 1.1060. From this level, it is possible to climb to 1.1100. In case of a decline in the trading instrument, only around 1.1000 do I expect any actions from major buyers. If there is no one there, it would be good to wait for the minimum of 1.0960 to be updated, or to open long positions from 1.0940. Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77.95% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on May 1, 2023 23:27:12 GMT -5
Forex Analysis & Reviews: Forecast for AUD/USD on May 2, 2023AUD/USD On Monday, the Australian dollar tested the resistance level of 0.6670, and under pressure due to the US dollar (#USDX 0.43%), returned to the support of 0.6628. On the daily chart, the Marlin oscillator did not react to the asset's growth. Marlin remains in the area of the downtrend.  At the moment, the price is trying to overcome this support; in a few hours, the Reserve Bank of Australia will make a decision on monetary policy, with the rate expected to be at 3.60%. Such a decision is unlikely to contribute to the strengthening of the Australian currency, even if the rhetoric is moderately aggressive, as tomorrow, the Federal Reserve Is almost guaranteed to raise the rate by at least 0.25%. The nearest target is 0.6567 – the low of March 8, then we expect movement to 0.6450.  On the four-hour chart , yesterday's movement above the MACD indicator line (blue) and a quick return below it indicates the falsity of yesterday's surge. The price has already consolidated below the line. We are waiting for the RBA's decision and expect the price to fall further. If the price climbs above 0.6670 and consolidates, it will open an alternative scenario with growth to 0.6730. Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on May 2, 2023 23:21:35 GMT -5
Forex Analysis & Reviews: GBP/USD. Overview for May 3. Market sentiment is changing to "bearish" The GBP/USD currency pair continued its not-too-strong decline for most of the day on Tuesday. All the week's most important events are still ahead, so the market is in no hurry to rush into opening trading deals. Moreover, the ECB and FRS decisions, likely to be announced on Wednesday and Thursday, have already been factored into the market. This means we may see sharp spikes in activity these days without significant changes in currency pair rates. In the case of the British pound, there has been uncorrected growth for two months. Uncorrected, not unstoppable, as the upward trend has weakened in recent weeks. The pound moved up with its last strength. The pain of the bulls, who desperately wanted to maintain the upward trend and interpreted almost every report favoring the pound, was visible. Still, at the same time, they received an extremely small number of real factors supporting the British currency. In any case, the pound has grown by 700 points in 2 months, and almost everything shows that a strong correction should begin in the 4-hour timeframe. On the 24-hour timeframe, it should also begin and be stronger than on the 4-hour. On the daily chart, about 2200 points were passed upward, implying a significant correction. Of course, making such conclusions on the eve of three central bank meetings is presumptuous, but if we see unprovoked growth in both pairs again at the end of this and next week, it will be too much. The market cannot be forbidden to trade in any direction, even if there are no reasons for it. But in this case, you can close your eyes to fundamental and macroeconomic analysis. What's the point if the market doesn't pay attention to it? The price has once again consolidated below the moving average line, which we have observed for the last two months at least seven times. No decline started after any of these overcomes. The CCI indicator has already entered the overbought area twice, which is a strong sell signal, so we continue to expect a powerful drop in the British pound. The US labor market continues to shrink. We would like to note one significant moment from yesterday, which may mean a change in market sentiment to "bearish." In the second half of the day, the JOLTs report on the number of job openings in the US labor market was released, which again turned out to be worse than the forecast value - 9.59 million against 9.775 million. The number of job openings has been falling for three months, which means a deterioration in the atmosphere of the labor market. We may see weaker reports on nonfarm payrolls and unemployment on Friday than currently expected. But that's not important. The US dollar practically did not fall immediately after the publication of this report. Earlier, traders would have had enough for the American currency to lose 60–80 points. On Tuesday, it lost 50 but quickly tried to return to its original path - to the south. This moment indicates that the market is refusing further purchases, regardless of the decisions made by the FRS and ECB. Of course, this conclusion is quite risky, but simultaneously, the pair cannot constantly move in one direction. Sooner or later, a turning point must come. Why not a day before the FRS meeting and a week before the Bank of England meeting? After all, surprises are unlikely, and in the case of the BoE, we may see a refusal to tighten policy for the first time in a long time. We believe that the rate will be raised once again, as inflation is still above 10%, but at the same time, we believe that one or two more increases - and this cycle will be completed regardless of the current inflation rate. The pound, like the euro, is losing one of its main support factors, of which there have been few recently.  The average volatility of the GBP/USD pair over the last five trading days is 96 points. For the pound/dollar pair, this value is considered "average." On Wednesday, May 3, we thus expect the movement within the channel to be limited by levels 1.2378 and 1.2572. A reversal of the Heiken Ashi indicator upward will signal a new round of upward movement. Nearest support levels: S1 – 1.2451 S2 – 1.2421 S3 – 1.2390 Nearest resistance levels: R1 – 1.2482 R2 – 1.2512 R3 – 1.2543 Trading recommendations: The GBP/USD pair in the 4-hour timeframe has corrected to the moving average. Sideway movement may resume again, as in recent weeks, we often observe flat rather than a trend. Trading can be done again only by reversing the Heiken Ashi indicator or on younger timeframes. Explanations of illustrations: Linear regression channels - help determine the current trend. If both are directed in one direction, the trend is currently strong. Moving average line (settings 20.0, smoothed) - determines the short-term trend and the direction in which it is now advisable to trade. Murray levels - target levels for movements and corrections. Volatility levels (red lines) - the likely price channel the pair will spend the next day, based on current volatility indicators. CCI indicator - its entry into the oversold area (below -250) or overbought area (above +250) means that a trend reversal is approaching in the opposite direction. Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on May 4, 2023 2:12:56 GMT -5
Forex Analysis & Reviews: USD/JPY analysis for May 04, 2023 - Potential for the further downside movement USD/JPY has been trading downside as I expected and the first upside objective has been reached at 135.00. Anyway, I see potential for the lower prices towards 133.35. Due to the strong downside momentum and no signs for the reversal, I see potential for the further downside movement towards lower reference. Next major downside objective is set at the price of 133.35 MACD is showing negative reading, which is sign that sellers are still in control. Intraday resistance is set at the price of 135.00 Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on May 4, 2023 23:31:17 GMT -5
Forex Analysis & Reviews: Forecast for EUR/USD on May 5, 2023EUR/USD Yesterday, the European Central Bank raised the rate by the expected 0.25%, and ECB President Christine Lagarde "promised" another increase around September. In general, the ECB's mood cooled investors' expectations, and the euro fell by 46 points.  Yesterday, the Marlin oscillator managed to record a low below the zero line (-0.0003), which, for a market with moderate volatility, shows the effective desire for the asset. The price needs to consolidate below 1.1033, which is easy to do with today's employment report since there's a possibility that it may exceed expectations. The euro's target is the convergence area of the MACD line with the embedded line of the descending price channel at 1.0920.  On the four-hour chart, the price has not yet been able to consolidate below the MACD indicator line – the volatility after the ECB meeting is making itself felt. Also, the Marlin oscillator did not stay in negative territory. I believe that today's US employment report will turn out to be better than forecasts, as the preceding indicators this week indicate an improvement in the labor market. This is a sharp increase in employment in the private sector (296,000 versus a forecast of 148,000), a sharp decrease in the number of layoffs according to Challenger data, and a normalization of unemployment benefit claims (albeit above average). And such an important point – three major American banks: PacWest Bancorp, Western Alliance Bancorp, Metropolitan are at risk of bankruptcy in the coming days, with KeyCorp, Valley National Bancorp, and a number of small banks approaching. The stock market is no longer able to grow at a rate of 5.25% (especially the banking sector), S&P 500 is falling heavily for the third straight day (yesterday -0.72%), so the counter-dollar currencies are unlikely to rise even with neutral macro data. Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on May 8, 2023 1:27:47 GMT -5
Forecast for GBP/USD on May 8, 2023GBP/USD On Friday, the British pound chose an alternative scenario with a short-term perspective – on quite good data on US employment, it overcame the resistance of 1.2598 and approached the target level of 1.2666. Now the whole question is in the level of divergence slope by the Marlin oscillator. The price may continue to rise to the second target of 1.2785, and the divergence will not be obstructed.  This target level is the average value of the extremes of June 2020 and November 2019. Such a scenario can be realized if the price consolidates above 1.2666. If the price consolidates below 1.2598, the pound will make additional efforts to reach 1.2447.  On the four-hour chart, the price, indicators, and oscillator are growing. The bullish sentiment is optimistic, and we can only wait for the price to consolidate above 1.2666. The probability of implementing the described scenarios is equal. Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on May 9, 2023 0:29:48 GMT -5
Forecast for EUR/USD on May 9, 2023EUR/USD As of today, the euro clearly correlates with the yields of US government bonds, which are growing and pulling the single currency down. But for more reliable conditions for the euro's medium-term decline, it lacks other correlating instruments - commodities or the stock market, which are still growing. Other counter-dollar currencies are also not in a hurry to reverse.  On the daily chart, the price is moving towards the important support of 1.0910, and consolidating below it may indicate a break in the uptrend from March 16th. The 1.0804 target will become available. The signal line of the Marlin oscillator is in negative territory - in the downtrend area. At the moment, the euro has not fallen deep enough to prevent it from reversing and working through the range of 1.1078-1.1110. On the four-hour chart, the price has once again consolidated below the indicator lines, with Marlin in the area of the downtrend. If signals from related markets support the dollar, this time these technical signals will be effective.  Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on May 9, 2023 23:16:45 GMT -5
Forecast for GBP/USD on May 10, 2023GBP/USD Yesterday, the pound closed almost at Monday's closing level. The Marlin oscillator's signal line lies in a sideways trend, thereby reducing the likelihood of creating divergence from Monday's peak, which tested the target level of 1.2666.  But the reversal potential is not exhausted, so consolidating below 1.2598 and overcoming yesterday's low of 1.2577 opens the target at 1.2447. On the four-hour chart, the Marlin oscillator returned to the positive area, but probably for a short time.  Below the level of 1.2598, there is another support – the MACD line. Overcoming it (1.2568) will remove the last obstacle for the development of a medium-term decline in the British currency. Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on May 10, 2023 23:28:00 GMT -5
Forecast for USD/JPY on May 11, 2023USD/JPY After the price reached the target level of 135.40 on Wednesday, it returned below the price channel line (134.50). The target on the MACD indicator line is 133.03.  The Marlin oscillator approached the zero line and presents two different interpretations: either the oscillator's signal line will reverse from this zero boundary and pull the quote above 134.50 for a repeated attack on the 135.40 level, or the Marlin will move to negative territory and help the price reach the MACD line (133.03).  On the four-hour chart, the price has consolidated below 134.50 and below the indicator lines; the Marlin oscillator has returned to negative territory. All these circumstances maintain the downtrend and the main scenario of achieving the target of 133.03. Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on May 12, 2023 2:28:34 GMT -5
Technical Analysis of GBP/USD for May 12, 2023Technical Market Outlook: The GBP/USD pair has made another new swing high at the level of 1.2678, so the key technical resistance located t 1.2666 was broken. After the new swing high was made, the Bearish Engulfing candlestick pattern was made at the top of the move, so the market pulled-back and keeps moving lower towards the technical support seen at the level of 1.2434. Please keep an eye on this level as any breakout lower might trigger the bigger correction on Pound. The weak and negative momentum in the H4 time frame chart supports the short-term bearish outlook for Pound.  Weekly Pivot Points: WR3 - 1.27061 WR2 - 1.26746 WR1 - 1.26607 Weekly Pivot - 1.26431 WS1 - 1.26292 WS2 - 1.26116 WS3 - 1.25801 Trading Outlook: Pound continues the corrective cycle to the upside and on the Weekly time frame chart the price is about to hit the 61% Fibonacci retracement located at the level of 1.2778. When this level is hit, the high volatility is expected, so please stay focused as the bears will defend this level strongly. Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on May 15, 2023 0:37:32 GMT -5
Technical Analysis of Intraday Price Movement of GBP/JPY Cross Currency Pairs, Monday May 15, 2023 On the 4-hour intraday chart of the GBP/JPY cross currency pairs, a Failing Wedge pattern can be seen and the support level at 168.04 is strong enough to prevent the GBP/JPY downward correction, especially with the confirmation by the MACD indicator which is in a speculative BUY position, so there is a high probability for GBP/JPY In the near future, JPY will appreciate, rally up to the level of 171.14 as the first target and the level of 172.30 as the second target as long as it is on its way to these targets, there will be no significant downward correction, especially if it breaks below the 166.46 level because if this level is broken down, all Bull scenarios that have been previously described will become invalid and cancel by themselves. Analysis are provided by InstaForex.Read More
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Post by instaforexgertrude on May 16, 2023 0:26:45 GMT -5
Forecast for EUR/USD on May 16, 2023EUR/USD On Monday, the euro went through a calm correction after sharply falling in the last two days. On the daily chart, there is no sign of the end of the correction, so it could continue to the resistance line of the price channel at the 1.0900 mark. It is possible to overcome this line, and then the price will be stopped by the MACD indicator line, located 15 points higher.  Then the price could reverse into a new wave of decline with the nearest target of 1.0804. On the 4-hour chart, the accelerated growth of the Marlin oscillator catches the eye.  This could be a sign of oscillator discharge before further subsequent decline, or the euro is waiting for a more complex correction from the new local low with the formation of convergence, as shown on the chart with dashed lines. Perhaps, until the end of the month, the euro will spend in a sideways wide-range. Analysis are provided by InstaForex.Read More
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