Bitcoin analysis for May, 23.2019

BTC price has has been trading downside as we expected. BTC tested and rejection of the $7.417. Anyway, we still expecting more downside on the BTC.

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Red horizontal line – horizontal support

Red Horizontal line 2 – horizontal support

Red rectangle – Resistance cluster

Breakout of symmetrical triangle in the background was the key for the sellers and today BTC is testing the lower diagonal of the triangle. Strong resistance is set at $7.745 and it is good place for short positions. Downward references are set at $7.417 and $7.010. Additionally, we found overbought condition on the Stochastic oscillator. Watch for selling opportunities with the first target at $7.417.

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GBP/USD analysis for May, 23.05.2019

GBP/USD price has has been trading upside as we expected. The GBP tested the level of 1.2670. We are still expecting more upside on the GBP.Red horizontal line – horizontal resistanceWhite line- Bullish divergence lineThe bullish divergence on the H4 t…

Analysis of Gold for May, 23.2019

Gold price has has been trading upside as we expected. The Gold tested the level of $1.287. We are still expecting more upside on the Gold.Yellow rectangle – horizontal resistanceOrange rectangle- horizontal resistance 2Gold has been trading upside and…

Technical analysis for Gold for May 23, 2019

Gold price was breaking below important support of $1,276 and was about to test $1,266 low. Price reversed and we are now looking at another try from bulls to change the trend. Resistance is still formidable at $1,300-$1,290 area so bears are still ali…

Total trade war can collapse most currencies

The threat of an escalation of the US and Celestial trade war triumphed the greenback and hit primarily on the positions of the currencies of developing countries. Based on the reports of Bloomberg, the salvo released by Donald Trump on May 10 for Chin…

Technical analysis of USD/CHF for May 23, 2019

Overview: The USD/CHF pair continues moving in a bullish trend from the support levels of 1.0123 and 1.0177. Currently, the price is in an upward channel. This is confirmed by the RSI indicator signaling that the pair is still in a bullish trend. As …

Technical analysis of USD/CAD for May 23, 2019

Overview: The USD/CAD pair continues to move upwards from the level of 1.3457. The pair rose from the level of 1.3457 (the level of 1.3457 coincides with a ratio of 61.8% Fibonacci retracement) to a top around 1.3505. But it rebounded from the top pf…

GBP/USD: plan for the US session on May 23. The pound updated its monthly lows but held above 1.2612

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

Buyers showed themselves in the support area of 1.2612, which I drew attention to in my morning review, and now their goal is to return to the resistance level of 1.2670, on which a further upward correction will depend. The main goal of buyers to build a good trend will be the highs of 1.2730 and 1.2789, where I recommend fixing the profits. In the scenario of a repeated decline to the support area of 1.2612, it is best to open long positions from there, provided that a false breakout is formed, or a rebound from the minimum of 1.2564.

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

Bears continue to push the pound down and are waiting for a steep collapse amid talk that British Prime Minister Theresa May will announce her resignation this weekend. The formation of a false breakout in the resistance area of 1.2670 will lead to a new wave of short positions in the pound and a decrease in the pair to the low of 1.2612, the breakthrough of which will provide sellers with a road to the support area of 1.2564 and 1.2500, where I recommend fixing the profit. In a scenario of rising above the 1.2670 during the second half of the day, the short position it is best to return the bounce from a high of 1.2730.

Indicator signals:

Moving Averages

Trading is below 30 and 50 moving averages, indicating a bearish market.

Bollinger bands

In the case of growth the pound, the upward trend will be limited to the upper border of the indicator in the area of 1.2680.

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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

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EUR/USD: plan for the US session on May 23. Weak reports on the eurozone allowed to break through the level of 1.1143

To open long positions on EURUSD, you need:

Buyers missed the support level of 1.1143 against the background of weak reports on the Eurozone and Germany, which indicated a decrease in activity indices. A new task for the second half of the day is to return to the range of 1.1143, which may lead to an update of the morning resistance level in the area of 1.1166, where I recommend fixing the profits. In the case of a further decline in the euro, it is best to return to long positions to rebound from a large low of 1.1112.

To open short positions on EURUSD, you need

Bears are required to form a false breakdown in the resistance area of 1.1143, which will maintain the downward potential and lead to a further reduction of EUR/USD to the support area of 1.1112 and 1.1079, where today I recommend fixing the profits. In a scenario of growth of EUR/USD above the resistance of 1.1143, short positions can be opened immediately to rebound from a maximum of 1.1166. Given the elections to the EU Parliament, volatility will continue to be extremely low.

Indicator signals:

Moving Averages

Trading is below 30 and 50 moving averages, which indicates the bearish nature of the market.

Bollinger Bands

The volatility of the indicator is low, which does not give signals to enter the market.

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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

Elections to the European Parliament and the possible resignation of Theresa May

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It seems that there are no more interesting events than the elections to the European Parliament, which will start today. Therefore, traders should closely monitor the dynamics of the euro, from which we can expect increased volatility in the coming days.

Many investors fear that populist parties may take a significant number of seats in the representative body of the EU.

By Sunday, it will be known whether eurosceptics will be able to get enough mandates to block rather than just slow down the legislative process.

The results can also have a significant impact on the upcoming elections in Italy. Rome plans to adopt a budget whose deficit exceeds the threshold value of the eurozone. If the Italian populists enlist sufficient support, then they can feel confident in their abilities and go for a confrontation with Brussels.

Despite the widespread belief that anti-European sentiment is negative for the euro, it should be recognized that populism does not always harm currencies. Take, for example, the United States and Australia. Donald Trump’s protectionist policies helped the US dollar, and his Australian namesake strengthened after the unexpected victory of Prime Minister Scott Morrison’s center-right Liberal Party over the weekend.

Will the euro be able to grow if the eurosceptic succeed in the elections? It’s hard to say for sure now. The election results will be published gradually, so we can not see the breakdown until at least Sunday, and then you can even expect a gap.

Technically, the EUR/USD pair is trading in a downtrend and, apparently, will not unfold until it closes above the mark of 1.1250.

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Meanwhile, the pressure on other currencies remains strong.

The pound sterling fell to 6-month lows against the US dollar after a negative reaction to the proposal of Prime Minister Theresa May on Brexit.

Apparently, T. May’s plan was not viable, since Labor and the Conservatives said that they would not support her proposal to first approve the deal on the Customs Union and may consider the option of holding a second referendum on this issue.

In addition, there are many rumors that the Conservatives will try to send T. May to resign in the coming days, not even giving her a chance for the last attempt.

British Prime Minister T. May is preparing to resign, reports The Times, citing her fellow party members, who believe that the head of the Cabinet will announce this tomorrow, May 24, after a meeting with the Chairman of the Parliamentary “Committee of 1922” Graham Brady.

“She hoped that she should take the last step, but if this is not possible, then she gets out of the way,” said one of the colleagues of the British Prime Minister.

“It seems that now among the most likely scenarios are the failure of the vote in early June, the resignation of T. May and the announcement of general elections in the country. It is possible that this will lead either to a “hard” Brexit or to the formation of the government of Jeremy Corbyn. Neither looks good for the pound. It is still unknown whether the clouds that are over the Old World and over the euro due to the elections to the European Parliament will be able to keep the EUR/GBP pair below 0.8800, however, the pressure on GBP/USD may well turn into a passage to the support level of 1.2500 and even a little further,” – says John Hardy, currency strategist at Saxo Bank.

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After updating the monthly lows, the USD/CAD pair returned to the range in which it has been since the end of April. “Loonie” was under attack due to lower risk appetite and almost 3% drop in oil prices.

Analysts at Danske Bank believe that the chances for a moderate strengthening of the “Canadian” remain.

“Despite the extremely negative signals from the United States and China, the parties are in no hurry with the implementation of the latest threats, and the growth of the global economy in the near future may not be as weak as investors expect, and will contribute to maintaining high oil prices,” – said the representatives of the financial institution.

According to the forecast of Danske Bank, within a month, USD/CAD will fall to the level of 1.33, and in the three-month perspective – to the level of 1.31.

The bank also believes that investors are mistaken in their expectations regarding the interest rate cut by the Bank of Canada.

“The probability of this event in the next 12 months is estimated by the market at 50%, but we are confident that the rate will remain unchanged. However, we do not think that the re-evaluation of the prospects will provide “loonie” significant support, as investors look at the rate in Canada through the prism of the Fed’s rates, so the adjustment of expectations is unlikely to affect the differential rates,” – said the experts.

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The dollar has reached a monthly high and is preparing to take a new height

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The dollar has updated the monthly maximum and is not going to stop; the economic and political uncertainty that has swept Europe and Asia is pushing the “American” up and putting pressure on most major currencies, including the euro and the yuan. The problems of German production, the consequences of the trade war for Asian countries, concerns about Brexit and the upcoming European parliamentary elections — against this background, the US, where the only problem is the trade conflict with China, looks the most attractive, and investors see the dollar as a relatively safe haven.

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There is every reason to believe that in the short term, the dollar will retain its popularity as a safe haven, even though the Fed is more relaxed than expected. Especially against the background of other central banks, which are lowering interest rates one by one, the Fed looks like an “aggressor”. The pigeon tone of the world Central Bank will support the growth of the dollar. Other factors are also on the side of the “American”. The activity in the services and manufacturing sectors in Germany is falling, which indicates problems in Europe’s largest economy. Concerns about the global economy are exacerbated by growing political uncertainty, especially in Europe. Brexit and parliamentary elections make investors worry about the stability of the euro and the pound. Both currencies are falling in price.

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In addition to the dollar, one should pay attention to the Japanese yen, which has risen sharply in price, since the constant fears of another escalation in the trade conflict between the US and China are excellent grounds for growth. If we add Brexit and other European problems to this, then the yen is waiting for a further rise. The currency rose to 110.23 yen per dollar, rebounding from a two-week low of 110.675, broken through on Tuesday, and also rose 0.2% against the euro, added 0.5% against the pound and rose 0.3% against the Australian dollar.

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

Simplified wave analysis and forecast for GBP/USD and USD/JPY on May 23

GBP/USD

Analysis of the structure of the last medium-term wave of the British pound from March 13 shows that it is close to completion. The price of the pair is in the upper part of the wide potential reversal zone of the oldest TF. In the wave of May 3, two days ago, the final part of the wave (C) started.

Forecast:

The chance that the price of the pair will slip through the zone of powerful support is very small. In the next day, the most likely scenario for the pound will be an upward rebound, up to the upper limit of the price corridor between the nearest counter zones.

Recommendations:

Proponents of trade within the session can make short-term sales of the pound while taking into account the limited potential of the move down. Buying the pound today can be very risky. It is recommended to refrain from trading during the price rollback and look for sell signals at its end.

Resistance zones:

– 1.2690 / 1.2720

Support zones:

– 1.2600 / 1.2570

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USD/JPY

The direction of the short-term fluctuations of the Japanese currency is given by the rising wave of May 13. In a larger wave, it gave rise to the final part (C). The wave has a high wave level, and over time, the entire movement will move to the senior TF. Since the beginning of the current week, the pair is falling, forming a correction to the previous trend section of the chart.

Forecast:

Today, in the first half of the day, the downward course of the pair’s movement is expected to continue, until its completion in the support zone. By the end of the day, the probability of a change in the direction of price movement increases.

Recommendations:

Before the appearance of reversal signals, it is worth refraining from trading or to significantly reduce the lot during sales. It is necessary to take into account the limited potential of reduction. Next, when the reversal signals appear on your TS, it is recommended to look for the points of purchase of the pair.

Resistance zones:

– 110.70 / 111.00

Support zones:

– 110.10 / 109.80

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Explanations to the figures: Waves in the simplified wave analysis consist of 3 parts (A – B – C). The last unfinished wave is analyzed. Zones show areas with the highest probability of reversal. The arrows indicate the wave marking according to the method used by the author, the solid background is the formed structure, the dotted ones are the expected movements.

Note: The wave algorithm does not take into account the duration of tool movements over time.

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

Overview of GBP/USD on May 23. The forecast for the “Regression Channels”. “Hard” Brexit or a second referendum?

4-hour timeframe

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Technical data:

The upper linear regression channel: direction – down.

The lower linear regression channel: direction – down.

The moving average (20; smoothed) – down.

CCI: -97.0078

In recent days, the UK has been covered with the news about the resignation of Theresa May, and voluntary, about her failure in negotiations with Labor, the rejection by the House of Commons of the “new” version of the “deal” with the EU from Theresa May. As you can guess, all this news was frankly negative for the pound sterling. It seems that Theresa May will not wait for the fourth vote, and the Parliament made it clear to her that it will not accept her version of the agreement on leaving the EU this time. From our point of view, Theresa May’s resignation had to happen at the first or second vote of no confidence. In this case, the head of state would have been a new Prime Minister, who would have started work on this issue first. Now, the UK will have to participate in the elections to the European Parliament, while continuing to try by all means to leave the EU. The new Prime Minister is likely to be Boris Johnson, who is an ardent supporter of the “hard” Brexit. There is a reason to believe that this issue will be resolved with him much more quickly, although it may not be as pleasant for the UK as we would like. However, the whole country has already realized that it’s impossible to quit the EU “in a soft way”. Accordingly, either to cancel Brexit through the second referendum or “hard” scenario. Meanwhile, the pound continues its free fall. Bears continue to push the pair down, as there is no reason to buy the British currency. To characterize the technical picture of the pound/dollar pair does not even make sense, it is obvious and there is no alternative.

Nearest support levels:

S1 – 1.2634

S2 – 1.2573

Nearest resistance levels:

R1 – 1.2695

R2 – 1.2756

R3 – 1.2817

Trading recommendations:

The pair GBP/USD continues its non-stop downward movement. Thus, sales of the pound sterling with targets at 1.2634 and 1.2573 are still relevant, before the Heiken Ashi indicator turns up, indicating a new round of upward correction.

It is recommended to consider long positions after the consolidation of the pair above the moving average with the targets at 1.2878 and 1.2939. However, at the moment, the position of the bulls is extremely weak, and this option is not expected in the near future.

In addition to the technical picture should also take into account the fundamental data and the time of their release.

Explanation of illustrations:

The upper linear regression channel – the blue line of the unidirectional movement.

The lower linear regression channel – the purple line of the unidirectional movement.

CCI – the blue line in the indicator regression window.

The moving average (20; smoothed) is the blue line on the price chart.

Murray levels – multi-colored horizontal stripes.

Heiken Ashi is an indicator that colors bars in blue or purple.

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