Analysis of EUR/USD and GBP/USD for January 29. Ahead of the Fed meeting, both European currencies continue to decline

EUR/USD

analytics5e31884ff2459.png

On January 28, the EUR/USD pair gained several base points and thus continues to build the expected wave y. Markets continue to get rid of the European currency. An unsuccessful attempt to break through the Fibonacci level of 76.4% may lead to quotes moving away from the reached lows and completing the construction of a downward wave and the entire downward trend section. A successful attempt will indicate the readiness of the Forex market to continue selling the euro currency and complicate the wave y.

Fundamental component:

The news background on Tuesday was interesting. Markets were waiting for the release of the report on orders for durable goods in America. And the results of this report surprised me enough. The total number of orders increased in December by 2.0% compared to November 2019. Markets expected to see a much more modest value. But other indicators were much worse than the expectations of the currency market. Orders for goods excluding defense decreased by 2.5%, excluding transport – decreased by 0.1%, and excluding defense orders and aviation – decreased by 0.9%. Thus, the data could be interpreted in different ways. This is exactly what the markets did, which at first continued to sell the euro, and then slightly weakened their selling positions, which led to the departure of quotes from the reached lows. In general, the decline of the European currency continues.

Today, all the market’s attention is focused on the evening meeting of the Fed, as well as on the speech of Jerome Powell. Economists, analysts, and currency market participants have little doubt that the US Central Bank will leave the key rate unchanged. Thus, the main attention will be focused on the accompanying statement of the Fed, as well as on the speech of the Fed Chairman Jerome Powell and his rhetoric. The latest not-so-good reports from America make us consider an option in which the rhetoric of the head of the Fed will become more “dovish”. Earlier, Powell said that during 2020, it is unlikely that the key rate will be revised downwards. However, if economic reports continue to deteriorate, the Fed may lower the rate again. In general, today, we just have to find out what has changed in the mood of the Fed.

General conclusions and recommendations:

The euro-dollar pair is presumably continuing to build a downward set of waves. Thus, I would recommend continuing to sell the instrument with targets located around the mark of 1.0982, which corresponds to 100.0% of Fibonacci. An unsuccessful attempt to break this mark will lead to a departure of quotes from the reached lows and, possibly, the completion of the wave y. Otherwise, I recommend staying in sales.

GBP/USD

analytics5e3197a2631af.jpg

The GBP/USD pair lost about 40 basis points on January 28 and continues to decline within the expected wave 3 or C. The expected wave 3 or C, if it is currently being built, takes a very complex and extended form. The entire wave structure after December 23 may require adjustments and additions. Only a successful attempt to break through the Fibonacci level of 38.2% (the blue grid) can give confidence that the construction of the downward trend section will continue.

Fundamental component:

The news background for the GBP/USD instrument on Tuesday was the same as for the EUR/USD. And the market reaction was similar. There are no interesting news and economic reports from the UK at the moment, so only European and American news has to be examined. Today – it’s the same meeting of the Fed, but tomorrow will be a meeting of the Bank of England and the markets are hoping to get information about the plans of the British Central Bank in the coming months, as rumors about the willingness to lower the key rate have been going for a long time. It may be lowered tomorrow. In any case, the instrument needs to make a successful attempt to break the mark of 1.2941 to execute the main option. This requires strong comments today from Jerome Powell or weak comments tomorrow from Mark Carney (or a reduction in the key rate, or an increase in the number of votes cast for a rate cut).

General conclusions and recommendations:

The pound-dollar tool continues to build a new downward trend. I recommend selling the instrument with targets located around 1.2941 and 1.2764, which corresponds to 38.2% and 50.0% for Fibonacci. The tool can complicate the entire wave markup, so the increase can resume at 1.3329 (in the case of a successful attempt to break the 23.6% Fibonacci level) and then I recommend considering new sales of the tool around the mark of 1.3329.

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

Evening review for EURUSD on 01/29/2020

Markets continue to be under pressure from the virus situation in China. Still, the markets have slowed down a bit. They are waiting for new data on the epidemic. So, the US market closed the day in positive territory.Now, the main event of the evening…

Technical analysis of GBP/USD for January 29, 2020

Overview: Pivot point: 1.3042.The GBP/USD pair traded above strong support at the level of 1.3011, which coincides with the 23.6.2% Fibonacci retracement level and 1.2961. This support has been rejected for four times confirming uptrend veracity. Maj…

Trading recommendations for EURUSD on January 29

From a complex analysis, we see the long-awaited touch of the psychological level of 1.1000, where the quote almost immediately reacted with a rebound, signaling indecision. The entire day yesterday was marked by extreme caution by market participant…

Gold has not reached its potential

The confident pace of the US dollar and Beijing’s assurances that it will win the coronavirus somewhat cooled the ardor of the “bulls” for XAU/USD, however, it did not sow panic in their ranks. The peak of the epidemic has not yet been reached, and the…

GBP/USD More A Buy Than A Sell! 29.01.2020

Market sentiment on GBP/USD seems uncertain on the H4 chart. The price has developed an important technical pattern, a valid breakout from this triangle will give us a chance to open a trading position. The price is trading in a major support area, so …

USD/CAD. At the moment, the forecast fulfills itself 100%!!! It’s only the beginning!!!

As I already wrote, USD / CAD always makes me very happy. This week, the pair is still working out the forecast 100%, which, of course, pleases me even more !!! Expect a test of the strategic level in the area of 1.3060. I described it in more detail in the current forecast …

“Everyone chooses their own path. And the more obvious the goal, the easier the path.”

Good morning, dear colleagues.

With you, as always, Sergey Denisov and the forecast for the likely movement of the USD / CAD currency instrument.

Let me remind you that this forecast is derived from the main long-term forecast for USD / CAD USD / CAD. Forecast and strategic level (goal), the development of which, at times, is at the level of 95% !!!, and it serves to ensure that we are with you every day, step by step, moving towards our “cherished goal “- towards profit!

During the trading session on Tuesday, January 28, 2020, USD / CAD completed the task at least 100%: a few hours after the opening of the trading day, the US dollar was already testing the level of the 32nd figure (1.3200), where clusters of high open interest were located, and the large volume of traded options contracts were on CALL. It can tell us about the “smart money” that would not mind buying futures for a decline in the US currency – they “enclosed” the CALL options in the data we see.

The trading plan for the main long-term forecast remains in effect until your humble servant cancels it for a number of reasons, which, of course, I will tell you in as much detail as possible.

At this stage, I see no reason to cancel the goal, but to cancel the scenario, which I will write a little below and show on the chart. It is quite realistic, but for this, you need an impulse update of the level of 1.3200, and its successful testing.

In this case, the scenario will be as follows: testing the level of 1.3260 with a further fall to the level of 1.3060. As you can see, the goal remains the same, only the “road” that we will take to reach it will change.

The plan is as follows: we are going to test the strategic level in the area of 1.3060. Not only is this level strategic, but there is still a large open interest in “smart money”.

analytics5e31566e584d4.png

It seems difficult? No! In future articles, every day, we will touch on the topic “using the tools that I predict the price movement”, as well as “my favorite patterns”. Moreso, later, if you, dear colleagues, have a desire to get answers to your questions about my forecasts, I will be very happy to hold a webinar for you!

Dear colleagues, please follow the publication of “derivative” forecasts for USD/CAD during the entire period of relevance of the main long-term forecast, so that you would not miss anything important and eventually get a profit!

IMPORTANT! Remember that you should enter the market only using patterns – graphic figures that are often repeated on the market, where as a result of their formation, there is a certain pattern of price behavior in the future.

In my trading, I use patterns consisting of candlestick analysis and volume analysis. One of my favorite patterns is updating the local highs on a sharply rising volume, with subsequent testing up to 50%-61.8% Fibo.

Thank you for your attention, dear friends.

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

Forecast for EUR/USD: Potential profit is in the area of +60p to +150p!!!

The EUR / USD pair will try to test strategic levels during the current week and the next, which will allow us, dear colleagues, to get a profit. However, remember that before testing the “profit levels”, the European currency may “go” to the support zone formed by the accumulation of a large amount of open interest and volume on option contracts.

“Everyone chooses their own path. And the more obvious the goal, the easier the path”

Good morning, dear colleagues.

With you, as always, Sergey Denisov and the forecast for the likely movement of the EUR / USD currency instrument.

Let me reminded you that this forecast is a derivative of the main long-term forecast for EUR / USD

“EUR / USD. The forecast and the trading plan, based both on technical analysis and on the analysis of open interest and the volume of CME options contracts! “

This serves to ensure that we are with you every day, step by step, moving towards our “cherished goal” – towards profit!

In the trading session on Tuesday, January 28, 2020, the EUR / USD trading instrument seems to be going exactly according to the long-term forecast. However, the 10th figure (1.1000) was not within the sellers’ power, and the price went for a correction of 30p to the level of 1.1028. From there, I hope again that it successfully “starts” down.

The strongest support zone is still within the 1.0940-1.0960 levels, due to the option contracts with a large open interest and volume. Option contracts are often used to hedge currency risks associated with the purchase of futures contracts. In our particular case, the support zone 1.0940-1.0960 is formed by PUT options, which implies the desire of “smart people” to enter BUY in this zone by buying futures contracts.

It seems difficult? No! In future articles, every day, we will touch on this topic, and later, if you, dear colleagues, have a desire to get answers to your questions about my forecasts, I will be very happy to hold a webinar for you!

The goals for BUY remains the same at 1.1080, 1.105, and 1.1155, as they are due to the presence of strategic levels – levels that the price fulfills in 80% of cases. I can also conduct a webinar about this!

analytics5e315033c6eac.png

Dear colleagues, please follow the publication of “derivative” forecasts for EUR/USD during the entire period of relevance of the main long-term forecast, so as not to miss anything important and eventually get a profit!

IMPORTANT! Remember that you should enter the market only using patterns – graphic figures that are often repeated on the market, where as a result of their formation, there is a certain pattern of price behavior in the future.

In my trading, I use patterns consisting of candlestick analysis and volume analysis. One of my favorite patterns is updating the local highs on a sharply rising volume with subsequent testing up to 50%-61.8% Fibo.

Thank you for your attention, dear friends.

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

Don’t buy a pound near this level!

Good day, dear traders! I present to your attention the analysis of the GBPUSD pair in the framework of the “hunt for stops” method.

As we predicted, the pair fell to the round level of 1.3 and is now trading slightly higher at 1.302. But few peopl…

Pound: obstacle course

analytics5e3142b26e130.jpg

In anticipation of the meeting of the Bank of England, the growth of the British currency is gaining momentum. The dynamics of the pound is so contradictory that it sometimes confuses the market. The ups and downs of sterling in a short period of time, in particular from the beginning to the middle of this week, surprise and slightly disturb experts.

On Tuesday, January 28, the GBP / USD pair was in a state of permanent decline. Over the course of two trading sessions, the pound fell by 100 points coming close to the support level of 1.3000. In the middle of the day, it slightly exceeded this level reaching 1.3005, but it did not stop there.

analytics5e3157025e1f8.png

Subsequently, sterling almost touched the bottom, falling to the Fibonacci level of 1.2995. A dizzying fall gave way to a slight rise. Experts recommended the sale of the pound from this level until the release of the report on orders for durable goods in the United States. They also added that in the case of disappointing data, the probability of the pair quotes rebounding from the correction line will increase.

analytics5e31571ca9481.png

Morning of January 29, the GBP / USD pair began to run to an upward trend again. The tandem rose to 1.3024–1.3025, intending to move further.

analytics5e315764506c2.png

However, the pound’s dreams were not destined to come true. This is because the pair quickly slipped from their current positions and again peaked. The tandem fell to the levels of 1,3007–1,3008, returning to its original position, where yesterday’s growth began.

analytics5e31577fc55d8.png

Experts are unanimous in their opinion that the current week, rich in events of paramount importance, can become a key one for the British currency. On Thursday, January 30, the Bank of England will decide on a rate and may soften monetary policy. On the following day, the United Kingdom will officially leave the European Union, which can provoke the strongest volatility in the market.

There are two versions regarding the possible decision of the English regulator. Some experts argue that at the current meeting, the Bank of England will reduce interest rates, as the real economic situation in the UK is deteriorating and incentives are needed to support the economy. Experts who disagree with this statement are confident that the regulator will maintain current rates, appealing to a recent report by the Organization for Economic Collaboration and Development (OECD), which focuses on stabilizing UK economic data. Recall that last week economic indicators came out for activity in the manufacturing sector and the services sector in the country, which turned out to be better than forecasts. According to analysts, this has weakened the likelihood of a key rate cut by the Bank of England. Note that at the moment, the interest rate in the UK is at the level of 0.75%.

The British currency is under serious pressure from the American. Throughout the week, the greenback strengthened against the pound, and the efforts of the US dollar were not in vain. The dollar was supported by investors who are trying to invest in less risky assets than the pound. At the same time, the downward movement of the GBP / USD pair is more due to the high demand for greenback than to the weakness of sterling, analysts reaffirm.

Experts also added that the British currency may again go down after the decision of the Bank of England at a key rate and monetary policy. Of course, after a while, the pound will rise again, however, experts fear that its recovery will be delayed. Uncertainties add the upcoming Brexit agreement, so the market is in suspense, keenly responding to key events.

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

Overview and forecast of AUD/USD for January 29, 2020

Hello everyone!I will start this review with the results of last week, which were again disappointing for the AUD/USD currency pair. The Australian dollar has been declining against its American namesake for four weeks in a row. Moreover, the current w…