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  • Inflation in the euro area declines for the third consecutive month

    All the attention of traders was focused on the data on inflation in the euro area which disappointed market participants. Inflation in the euro area is declining for the third consecutive month. What can we expect from the euro?

    No matter how it seems, the inflation rate that was set in the autumn of last year is gradually extinguished with the euro zone's CPI is declining for the third consecutive month. This is a very unpleasant fact for the European Central Bank which set a 2% target in the next few years.

    This is also an unpleasant moment for traders who are betting on the further strengthening of the euro at the beginning of this year. The main reason for the lack of demand is the probable postponement of the deadline for the curtailment of the ECB's repurchase program, which was scheduled for the fall of this year. Also, we have to forget about all the talk about raising interest rates in early 2019.

    Let's understand why it happened that way.

    According to today's data, even if it is preliminary, it can be seen that in February this year, the inflation rate in the eurozone slowed for the third month in a row. So, consumer prices in the euro area for the month of February rose by only 1.2% compared to the same period in 2017, which is below the target level of the ECB, set just below 2%. As early as November 2017, inflation showed an increase of 1.5%.

    A number of experts associate a slowdown in inflation with a decline in energy prices, which revived the CPI in 2016 and kept it growing throughout 2017. Also, there is a noticeable lack of a fundamental link between the acceleration of economic growth and the rise in inflation that was to occur. A similar situation is observed in the United States.

    If we talk about core inflation, which does not take into account volatile prices for energy and food products, then growth was at 1%.

    As I have already mentioned, a number of European Central Bank leaders, including its president Mario Draghi, made it clear that as long as there is no concrete evidence of an increase in inflation, no one will talk about a change in soft monetary policy despite good economic growth.

    It is important to note that the strong growth of the US dollar began yesterday after Federal Reserve Chairman Jerome Powell made a speech in the Congress where he said that there was an improvement in the prospects for the US economy, which keeps the Federal Reserve's policy rigid. So he outlined his position on further raising interest rates.

    As for the technical picture of the EURUSD pair, the breakthrough in the support level of 1.2200 could significantly collapse the trading instrument, since there is a mass of monthly stop orders for buyers of risky assets below this range. The breakthrough at the level of 1.2200 will lead to a pair of support in the areas of 1.2130 and 1.2080, which will also allow us to hook the level of 1.2050.

    Analysis are provided by InstaForex

    Comment


    • Elliott wave analysis of EUR/NZD for March 2, 2018


      Wave summary:
      There is not really anything new to say here. We continue to look for a continuation higher through the resistance at 1.6960 and 1.6999 for a continuation towards 1.7094 and 1.7470 as the next upside targets.

      Short-term support is seen at 1.6867 and again at 1.6809.
      R3: 1.7094
      R2: 1.6999
      R1: 1.6960
      Pivot: 1.6900
      S1: 1.6867
      S2: 1.6809
      S3: 1.6778

      Trading recommendation: We are long EUR from 1.6790 with stop placed at break-even.

      Analysis are provided by InstaForex

      Comment


      • Daily analysis of EUR/JPY for March 5, 2018

        EUR/JPY This cross pair is a weak market. It is interesting to see the market is engaged in a long, protracted bearish movement. Since the beginning of February, at least, 700 pups have been shed. In the past few weeks, short-term rallies have been invariably followed by further southwards movements.



        There is currently a Bearish Confirmation Pattern in the market. The price would continue moving downwards towards the demand zones at 130.00, 129.50 and 129.00. Nonetheless, a strong rally is in the offing, as the outlook on EUR pairs is bullish for this week.

        *The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

        Comment


        • USD/JPY approaching resistance, prepare to sell

          The price is seeing strong resistance at 106.47 (Fibonacci retracement, Fibonacci extension, horizontal overlap resistance, descending resistance) and a strong reaction could occur at this price to push it down to 104.77 support (Fibonacci extension). We do have to watch out for intermediate support at 105.24 (horizontal swing low support) which needs to be broken to open a further drop.

          RSI (89) sees descending resistance hold price down really well with its bearish momentum.
          Sell below 106.47. Stop loss at 107.34. Take profit at 104.77.

          Analysis are provided by InstaForex

          Comment


          • Daily analysis of EUR/JPY for March 7, 2018

            EUR/JPY
            There is recently an upwards bounce in the market – in the context of a downtrend. The upwards bounce is yet to nullify the downtrend, but it would do so as soon as the price goes above the supply zone at 132.50, which would require a strong buying pressure. Right now, the EMA 11 is almost crossing the EMA 56 to the upside, and the RSI period 14 is above the level 50. Once the EMA 11 is above the EMA 56, the bias on the market would turn bullish.

            There is still a Bearish Confirmation Pattern in the market, but the recent rally has become a threat to the extant bearish outlook. Nonetheless, a strong rally is in the offing, as the outlook on EUR pairs remains bullish for this week.

            Analysis are provided by InstaForex

            Comment


            • Gold was trapped

              The news about the resignation of the chief economic adviser to the president Gary Cohn allowed gold to mark its best daily level since Valentine's Day. If an ardent opponent of protectionism, an ex-candidate for the presidency of the Fed, withdraws from his post, a potential global trade war is unlikely to be avoided. And in it, all weapons will look good. Including - large-scale selling of US Treasury bonds by the main holders in the face of China and Japan. I believe other countries will do the same. Their desire to get rid of the power of the dollar will force them to shift to gold. Thus, trade wars are potentially capable of providing the precious metal with invaluable support.

              Until March, investors' demand for ETF products was characterized by mixed dynamics. The fall in the XAU/USD and the increase in gold volatility contributed to an outflow of 5.1 tonnes in February. The biggest losses were suffered by European (-7.3 tons) and North American stock-exchange specialized funds (-5.1 tons), while Asians, on the contrary, replenished their reserves (+7.9 tons). As a result, according to the latest figure, it has increased by 10% since the beginning of the year.

              Monthly dynamics of demand for ETF products

              Source: WGC.
              Annual dynamics of demand for ETF products

              Source: WGC.
              In my opinion, the value of the investment demand for precious metals was influenced by the strengthening of the US dollar. The fastest growth in the weekly wage in January over the past few years has strengthened the risks of overclocking inflation and the aggressive monetary tightening of the Fed. Moreover, the new head of the Federal Reserve was optimistic about the US economy and the way of betting on federal funds. The President of the Federal Reserve Bank of New York, William Dudley, indicated four hikes in 2018 - a gradual normalization of monetary policy. As a result, the futures market increased the chances of such an outcome to 34%, and gold plunged into a wave of selling. Everyone remembers perfectly how uncomfortable it felt at the eve of the historic FOMC meetings in 2017.

              Nevertheless, the growing likelihood of the implementation of the policy of anti-globalization, Donald Trump, significantly tempered investors' appetite for risk. If the stock indexes behaved rather restrained in response to the high-sounding statements of the US president on tariffs on the import of steel and aluminum, the resignation of Gary Cohn convinced that the matter should be taken very seriously.

              In the medium term, gold can be trapped in consolidation: on the one hand, news about the trade war will provide support to the bulls on the XAU/USD; on the other hand, the return of the divergence idea in the monetary policy of the Federal Reserve and the central banks-peers can become a saving straw for the US dollar. In my opinion, in the second and third quarters, against the background of the return of the normalization theme, its strength will run out, so the price will drop to the lower border of the trading range of $1300-1360 per ounce, which makes sense to use for purchases.

              Technically, if the bulls manage to return gold quotes to the limits of the upward medium-term trading channel, then the risks of implementing the target values by 113% and by 127.2% according to the Shark and AB = CD patterns will increase. Gold, daily chart

              Analysis are provided by InstaForex

              Comment


              • USD/JPY has reached our profit target perfectly, prepare for further rise

                The price has risen perfectly to our profit target and looks poised to rise further after breaking a strong descending resistance-turned-support line. We look to buy above 106.48 (Fibonacci retracement, horizontal overlap support, breakout level) for a push up to 108.51 (Fibonacci retracement, horizontal pullback resistance). We do have to be cautious about 107.78 resistance as the price might react off that level.

                RSI (89) has made a similar bullish exit signaling a change in momentum from bearish to bullish.

                Buy above 106.48. Stop loss at 105.81. Take profit at 108.51

                Analysis are provided by InstaForex

                Comment


                • NZD/USD Intraday technical levels and trading recommendations for for March 20, 2018



                  Daily Outlook

                  In July 2017, an atypical Head and Shoulders pattern was expressed on the depicted chart which indicated upcoming bearish reversal.
                  As expected, the price level of 0.7050 failed to offer enough bullish support for the NZD/USD pair. That's why, further bearish decline was expected towards 0.6800 (Reversal pattern bearish target).
                  Evident signs of bullish recovery was expressed around the depicted low (0.6780). An inverted Head and Shoulders pattern was expressed around these price levels.
                  The price zone of 0.7140-0.7250 (prominent Supply-Zone) failed to pause the ongoing bullish momentum. Instead, a bullish breakout above 0.7250 was expressed on January 11.
                  That's why, a quick bullish movement was expected towards the depicted supply zone (0.7320-0.7390) where evident bearish rejection and a valid SELL entry were expected.
                  On February 2, a bearish engulfing daily candlestick was expressed off the price level of 0.7390. Moreover, a double-top reversal pattern was expressed around the price zone (0.7320-0.7390).
                  The price zone (0.7320-0.7390) stood as a significant supply zone for the NZD/USD pair. Any bullish pullback towards this price zone should be considered for a valid SELL entry.
                  On the other hand, bearish breakdown of 0.7300 (neckline) is needed to confirm the depicted reversal pattern. Bearish projection target would be located around 0.7050 and 0.7000.

                  *The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

                  Comment


                  • EUR/JPY analysis for March 21, 2018 Recently, the EUR/JPY pair has been trading sideways at the price of 130.48. According to the 30M time frame, I found that price has broken the upward channel (bearish pennant) in the background, which is a sign that buying looks risky. I also found a strong downward leg in the background, which is another sign of weakness. My advice is to watch for potential selling opportunities. Downward targets are set at the price of 130.32 and at the price of 129.60.

                    Resistance levels:

                    R1: 131.30
                    R2: 132.20
                    R3: 132.65
                    Support levels:
                    S1: 129.93
                    S2: 129.44
                    S3: 128.53

                    Trading recommendations for today: watch for potential selling opportunities.

                    *The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.
                    Last edited by IFX Yvonne; 03-21-2018, 10:20 AM.

                    Comment


                    • Technical analysis of NZD/USD for March 22, 2018

                      NZD/USD is expected to trade with bullish outlook. The pair is still showing upward momentum after a break-out from a resistance level at 0.7185 (now a key support). Currently, it is trading at levels above both the 20-period and 50-period moving averages while targeting the first upside target at 0.7260 (around the high of March 19). The relative strength index is well directed in the 70s, indicating strong upward momentum for the pair. Upon crossing 0.7260, the next upside target at 0.7280 would come into sight.

                      The black line shows the pivot point. Currently, the price is above the pivot point which is a signal for long positions. If it remains below the pivot point, it will indicate short positions. The red lines show the support levels, while the green line indicates the resistance levels. These levels can be used to enter and exit trades.

                      Resistance levels: 0.7260, 0.7305, and 0.7350.
                      Support levels: 0.7150, 0.7125, and 0.7100.

                      Analysis are provided by InstaForex

                      Comment


                      • Daily analysis of EUR/JPY for March 23, 2018

                        EUR/JPY
                        The long-awaited bearish bias has already surfaced on this cross. The price plunged yesterday, breaching the supply zone at 129.50 to the downside. The demand zone at 129.00 was tested before the price bounced upwards (temporarily). The demand zone at 129.00 would be tested once again, and get broken to the downside, as the market moves further downwards.

                        There is a Bearish Confirmation Pattern in the market, and it has become clearer as price goes further downwards owing to a bearish outlook on the cross. The EMA 11 is below the EMA 56, and the RSI period 14 is below the level 50.

                        Analysis are provided by InstaForex

                        Comment


                        • Daily analysis of EUR/JPY for March 26, 2018

                          EUR/JPY
                          The conditions in the market is quite choppy. Although the market is choppy, the bearish trend has been maintained.Price has been going southward since February 5, having lost almost 800 pips since then. Last week, there was a rally attempt in the context of an uptrend, which was halted once the supply zone at 131.50 had been tested.

                          Further upward movement was effectively prevented. The market shed 250 pips following that, to test the demand zone at 129.00, and closed below the supply zone at 129.50. The expected weakness in EUR, as well as the bearish outlook on the market, may enable the demand zones at 129.00, 128.50, and 128.00 to be tested this week.

                          Analysis are provided by InstaForex

                          Comment


                          • Daily analysis of GBP/USD for March 27, 2018

                            The pair stays strong in the short-term as the price action is consolidating above the support zone of 1.4136. Currently, GBP/USD is facing off the resistance level of 1.4225, which is the last hurdle ahead of the 1.4269 level and if it manages to break above such area, the bulls could strengthen in the short-term. MACD indicator remains in the positive territory, favoring to the bulls.

                            H1 chart's resistance levels: 1.4225 / 1.4269
                            H1 chart's support levels: 1.4136 / 1.4061

                            Trading recommendations for today: Based on the H1 chart, buy (long) orders only if the GBP/USD pair breaks a bullish candlestick; the resistance level is at 1.4225, take profit is at 1.4269 and stop loss is at 1.4185.

                            Analysis are provided by InstaForex

                            Comment


                            • Technical analysis: Intraday level for USD/JPY, March 28, 2018



                              Today Japan will not release any Economic Data, but the US will release some Economic Data such as Crude Oil Inventories, Pending Home Sales m/m, Prelim Wholesale Inventories m/m, Goods Trade Balance, Final GDP Price Index q/q, and Final GDP q/q. So, there is a probability the USD/JPY will move with a low to medium volatility during this day.

                              TODAY'S TECHNICAL LEVEL:

                              Resistance. 3: 106.13.
                              Resistance. 2: 105.92.
                              Resistance. 1: 105.72.
                              Support. 1: 105.45.
                              Support. 2: 105.25.
                              Support. 3: 105.04.

                              Disclaimer: Trading Forex (foreign exchange) on margin carries a high level of risk, and may not be suitable for all Traders or Investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

                              *The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

                              Comment


                              • Technical analysis: Intraday Level For EUR/USD, April 02, 2018

                                When the European market opens, the US will release the Economic Data such as ISM Manufacturing Prices, Construction Spending m/m, ISM Manufacturing PMI, and Final Manufacturing PMI, so amid the reports, EUR/USD will move in a low to medium volatility during this day.

                                TODAY'S TECHNICAL LEVEL:

                                Breakout BUY Level: 1.2372.
                                Strong Resistance:1.2365.
                                Original Resistance: 1.2353.
                                Inner Sell Area: 1.2341.
                                Target Inner Area: 1.2312.
                                Inner Buy Area: 1.2283.
                                Original Support: 1.2271.
                                Strong Support: 1.2259.
                                Breakout SELL Level: 1.2252.

                                Analysis are provided by InstaForex

                                Comment

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