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Powell breaks taboo & opens a Pandora's boxThis week Fed Chairman Jerome Powell was speaking to Congress. He the things that may modify the state of the foreign exchange market. It is not about the Fed rates and the monetary policy vector, but about problems that have been trying not to talk about, because attracting attention to them is a very risky idea. We are talking about the so-called “three Ds” which are major US problems and precisely because of which it can collapse into the abyss. They are Government Debt, Budget Deficit, Trade Balance Deficit. In our reviews, we have already mentioned that more than once. The markets preferred to remain silent about “three Ds” existence since this is a time bomb for the US economy It's only a matter of time before it detonates. The US debt exceeds GDP and reached $ 24 trillion, the budget deficit is about a trillion dollars a year, the negative balance of export surplus on an annualized basis has exceeded $ 0.5 trillion. These figures also tend to deteriorate, since the construction of the pyramid of public debt in such conditions is inevitable and sooner or later it will collapse. Sum up, the dollar and the US economy will be under ruins. Therefore the markets are trying not to think about it. However, this week, Powell upset the stability and attracted the attention of markets to the problems of public debt and budget deficits, noting that without their fundamental decision, the US won't help any Fed action. The current rate leaves very little chance for the action of the Central Bank in the event of a crisis. Powell admitted that this time the Fed is unlikely to be able to pull the United States out of depression, as it was in 2007-2009. Focusing on the “three Ds” is a very bad signal for the dollar. If the markets turn their attention to these problems, the dollar may begin a very protracted decline, the bottom of which is simply not visible from the current height. So, our position to sell the dollar has only received additional argumentation. It is worth noting the positive statistics on German GDP. Positive because the country escaped the recession and was able to demonstrate even minimal, but still GDP growth (0.1% with the forecast of -0.1%). The eurozone as a whole also showed GDP growth (0.2% with the forecast of 0.1%). In this light, the current price of the euro seems quite attractive for us to purchase it. The variation of the hundred points is permissible. Remember set up small stops. The pound ignored weak macroeconomic statistics (retail sales appeared worse than expected in the negative zone). Which once again confirms our recommendation to buy a pound at the earliest opportunity. The only threat to the pound is Brexit. But from this side, problems should not be expected until the election results are announced. So we continue to look for points to buy the pound. China showed weak data. Which again renewed the purchase of safe-haven assets. Nevertheless, buying gold or the Japanese yen you should be careful, since any positive news regarding the negotiations between the US and China may stimulate local sales in safe-haven assets.
TVC:DXYShort
by Trade24Fx
Morgan Stanley warns, Powell & inflation under scrutinyThe current week is full of informational events around the oil market. Which continues to play into the hands of sellers. Yesterday, for example, Morgan Stanley analysts warned that if OPEC + participants at their next meeting on December 5 do not announce a higher reduction in production (current volumes of 1.2 million barrels), then Brent quotes will drop to $ 45 (now the price is around 62). That is, the scale of the fall will be about 25-30%. The chances of a new agreement are small, since countries that are not members of OPEC + are increasing production, so it’s not worth counting on the fact that Cartel members will aloud another loses. Accordingly, the downward pressure on oil quotes in December may increase sharply. Recall that this week we revised our intraday asset position and again recommend oil sales. And a few words about the oil market, but in the context of our recommendation to sell the ruble. According to Saudi Aramco, the cost of producing a barrel of oil in Russia exceeds $ 40, two times more compared with Saudi Arabia, and in general, is one of the highest rates in the world (even higher than in the UK and the USA). That is, Russia is one of the most vulnerable countries in the world for falling oil prices. That is why we recommend the sale of the Russian ruble. Meanwhile, ZEW data for the Eurozone as a whole and Germany, in particular, show that economic expectations are still pessimistic, so yesterday's downward pressure on the euro is understandable. The pound reacted quite positively to the statistics on the labour market in the UK, but yesterday there were no strong movements in pound pairs. We continue to wait for news from the Brexit, but for now, there is none - we work with the pound without obvious preferences on the intraday basis - you can buy or sell it, also use the oversold/overbought time zones as guidelines. Today, the reason for the pound volatility jump may be inflation statistics. Given that at the last meeting of the Bank of England Monetary Policy Committee, two members spoke out in favour of lowering the rate, weak inflation data could well trigger a pound decline. We recommend using this for cheaper purchases. Also, data on consumer inflation will be published in the United States. It will be interesting in the context of the fact that in the evening Fed Chairman Jerome Powell will speak to the Congress. The markets are now very concerned about what the Fed is going to do next. The current consensus is a pause in the Fed's actions. But any Powell's allusions to the possibility of an early rate cut will almost certainly provoke a dollar sale in the foreign exchange market.
FX:USOILShort
by Trade24Fx
Call me crazy, later.... GBP/NZD swing trade to the moon!Based on the weekly double bottom that has been pushing price since around 2016, the market has ultimately predicted the out outcome of Brexit, or any positive or negative news that is to come. If we can stay in tune with the weekly formation, price needs to get up to the next weekly selling zone. FX:GBPNZD side note: I did hedge this position with a sell at the top of the weekly zone on the short term reversal, but I can't not buy on the news sell off into liquidity.
Long
by benson21
Bad for oil and good for poundYesterday marked of news regarding the oil market and its prospects. Moreover, this news has a one-sided impact in terms of the impact on oil quotes. On the supply side, we have a message about the discovery of a huge oil field in Iran. It is about 50 billion barrels. To understand if it is a lot, let’s have a look at the statistics. Proved oil reserves in Iran rank fourth largest in the world (150 billion barrels). Accordingly, 50 billion = 30% will be added to existing stocks. That is a lot. It should be noted that while Iran is under sanctions, that is an accumulated potential than a real injection of additional supply on the market. But from the perspective of a market development strategy, the signal is undoubtedly bearish. Especially when you consider the news that Global oil demand may peak within the next 20 years, according to an assessment included in the prospectus for Saudi Aramco's initial public offering and, and further it will only decline. This news does not solve much in terms of supply/demand. But the prospects look extremely alarming for oil buyers. Sum up, in the short term, this news does not have that much impact. But in the long term, the oil market looks increasingly vulnerable. Knowing the markets and their general timidity, we will refrain from buying oil at current prices and will prefer its sales on the intraday basis this week. Until it becomes clear that investors and traders are fully aware of the situation. Yesterday, the foreign exchange market was relatively calm. The only exception is the British pound. Moreover, the reason for its splash was not macroeconomic statistics, which would be logical, since the data were published very important (GDP and industrial production), but traditionally news regarding Brexit. Nigel Farage has said the Brexit party will not field any candidates against the Conservatives in the 317 seats they won at the last general election. Motivation is the desire to prevent a second referendum on Brexit. The pound on this news naturally grew, since the chances of a “soft” Brexit increased. However, we believe that in the current political situation, any “scenario” play into the hands of the pound. So its purchases, in our opinion, remain relevant. Our idea is confirmed by yesterday’s reaction of the pound to rather weak macroeconomic statistics. Industrial production in September fell by 0.3% (forecast: -0.1% m / m), and GDP for the third quarter grew by only 0.3% (forecast: + 0.4%), and the state of the trade balance significantly worsened ( -12.541 billion against -10.825 in August). However, the pound has grown steadily We also do not forget to sell the Russian ruble, which again trades above 63.50, hinting that paired with the dollar its next target is 65.
Long
by Trade24Fx
ORBEX: GBPUSD,EURUSD: Brexit Party Won't Contest Conservatives!In today’s #marketinsights video recording, I talk about #GBPUSD and #EURUSD #FXMajors #Pound surged higher yesterday following headlines that Nigel Farage, Brexit Party's leader, will not contest Conservative seats ahead of the Dec 12 elections! On the economic front, the UK was marginally away from a recession, the latest GDP figures showed. With #employment data on the spotlight, #cable is the intraday pair that traders could find opportunities on. #EURUSD was somewhat supported by a weaker #dollar. The #greenback was seen falling on #Trump's rollback comments, as he denied having agreed on a tariff rollback with China. German #ZEW data will provide clues on #euro's direction. Stavros Tousios Head of Investment Research Orbex This analysis is provided as general market commentary and does not constitute investment advice.
by Orbex
GJ: Bull FlagExpectations for a break are to both the downside and upside. Confluences for a break to the downside is a weekly downtrend, key level of 140, and the retracement zone fo the longer term structure. For this, it's important to keep in mind how much different this cross pair is than say GBP/USD for example. No suggested entries as of yet, as it's only Monday. This pair is highly susceptible to movement caused purely by reactionary trades around brexit revelations. This trade and all others given in our telegram (free to join)
by UnknownUnicorn3442968
2
USA and China, Saudi Aramco and Bank of EnglandThe previous week, promised to be relatively calm, however, it turned out to be eventful. Gold and the Japanese yen were under downward pressure. The reason is the progress in negotiations between the US and China as well as the growth of positive market expectations regarding the end of trade wars in the foreseeable future. The main result of the week was the news that the United States and China agreed on a phased cancellation of duties before signing a deal. Another event was a separate decision by the Bank of England to leave the rate unchanged. Markets did not expect two members of the Monetary Policy Committee to be in favour of a rate cut. That triggered a decline in the British pound value. In general, you should not expect strong movements in the pound, because the basic driver of pound value in the last 3 years is Brexit. But it is paused so far. So any movement caused by news not related to UK exit will be limited. Due to the large amounts of macroeconomic statistics, the future of the pound looks very vague. On Monday, data on GDP and industrial production in the UK will be published, on Tuesday - statistics on the labour market, on Wednesday - inflation data, on Thursday the data on retail sales will sum up the week. Since the dynamics of the pound, this week will depend on the output data, we will adjust the positions depending on the nature of the data. At the same time, we do not expect irrationality from the foreign exchange market. That is, weak data will provoke sales in pound pairs, and positive statistics data will be the reason for the growth of the pound. Total, this week in the pound we will act contextually, but we give preference to its purchases. On the other hand, we have a very definite position in the oil market - we will look for points for asset purchases. Saudi Arabia in connection with the impending IPO Saudi Aramco will do anything to ensure the growth of oil prices. Latest data on the number of active oil rigs in the United States (the number has dropped to the lowest marks since April 2017) play into the hands of buyers. So we buy oil on the intraday basis. The goal is the growth up to 60.
Long
by Trade24Fx
CABLE Could Test 1.2700 Level After Support Break!Hello Viewers, this is an instant trade signal! Therefore, please have a look at the main chart for the following vital trade details: • ENTRY POINT • STOP LOSS • TAKE PROFIT • RISK TO REWARD The setup may look simple but I can assure you it is NOT. There are various in depth technical and fundamental analysis incorporated behind the execution. I would very much love to explain these two aspects here but doing that would consume ample amount of time which could affect the appropriate entry point behind this trade! So, to keep it simple the main chart just displays the simplified technical view of this trade. My way of performing technical analysis basically starts by breaking down the monthly Timeframe down until the One Hour charts. The following are the aspects I focus most on when performing technical analysis: • Draw Support & Resistance through key common psychological levels on M & W Charts. This helps me to see where the price might stall or breakout. • Draw Trendlines to determine the dynamic support and resistance levels present on the charts. This helps me to determine where the price might stall and most importantly help determine the path of least resistance behind the active trade. • I also tend to use EMA 50 on all the Timeframes. This EMA 50 is proficiently proven to act as dynamic support and resistance and is vital behind all my analysis. • Lastly, I tend to use classic pivot levels to determine my entry, stop loss and take profit levels. The combination of this and all of the above helps me determine the precise and likely trade targets behind the setup. Another aspect of my way of analysis is reading a lot of news to determine the fundamental aspects affecting any trade. After the technical analysis is performed, I tend to match if the fundamental aspect really supports my technical analysis. Therefore, as you could see, putting all my thoughts here would surely take up a lot of time which could make the price drift away from the entry price thus affecting the Risk to reward ratio. I understand it is vital for many of you to know the details behind this trade setup, and so if you are interested you could send me message and I will try to share most of what I can! The Above words are just template I use in all my trades. Shall there be any updates I will provide them here. Thank you
Short
by FX618Analysis
1
GBPUSD 1.300 CeilingGBPUSD following market structure with an uptrend of higher lows and higher highs to the 1.3000 resistance/flip zone. From here you can see the trend began to exhaust and weaken when attempts to make another higher high failed. We have formed a double top pattern which is an exhaust and trend reversal pattern. From here I am awaiting a break and close below the 1.2795 zone which is a short term flip zone. This could potentially be a set up to hold through the week ahead given the lower highs and lower lows which will be made (multiple swings compose a trend). Target will be the 1.2575 zone. Be careful though. I do not really want to be trading GBP pairs due to the whole Brexit fiasco, but the chart here does look good. I will assess if we get the break and close.
Short
by Uncharted-FX
Why buying EURUSD is a great chanceLooking at the EURUSD daily chart, it clearly shows that it has come to a very important support level. That is a great reason for its purchasing. The stops are relatively small - about 30-40 points, and the profits, in this case, are about 100 points (the nearest strong resistance is located in the region of 1.1160). That is, purely technically, taking into account adequate money management (the profit margin is 2.5 times higher than the stop value), so that is a nice opportunity for earning. The fundamental background is the only thing that can negatively influence. In our opinion, the situation with the euro does not look hopeless and the chances of supporting 1.1060 are quite large. The Eurozone economy is experiencing tough times. However, yesterday's data on retail sales and business activity in the Eurozone came out better than expected, which is more important that the indicators showed a positive trend: retail sales grew by + 0.1% with a forecast 0%, and the composite PMI index was 50.6 with a forecast 50.2 ( the value of the indicator above 50 indicates an increase in economic and business activity). Against the background of rather weak data, these signals have been extremely positive. Leaving the EU without a deal option is eliminated from the agenda. which is great news for the euro. Against this background, the pound rose by 1000 points. And the euro added only 100-200 points, it means that the euro did not worked out yet. Why should the euro grow because of the information that the “hard” Brexit will not take place? The fact is that Britain’s exit from the EU without a deal is not only about losses for the UK but also multibillion-dollar losses for the Eurozone economy, therefore potentially serious problems for the euro. So the removal of this issue from the agenda is a positive signal in favour of purchases of the euro. Its descent below 1.10 was an attempt to discount under exit without a deal. And since it does not take place, then the euro should return to its original position, to grow. Trade war escalation between the US and the EU is delayed while approaching the end of trade wars between the US and China. For the euro, this is a positive signal. Let us explain: the locomotive of the Eurozone economy is Germany. The German economy is export-dependent, that is, its success/failure is determined by the state of global markets, primarily China. The end of the trade wars between the United States and China will give a powerful impetus to the return of the world economy to the normal statement and one of the first to benefit from this will be Germany. In turn, improving the state of the German economy is improving the state of the Eurozone as a whole. And this is will reflect positively on the euro. So, we do not see serious threats to the euro at the moment. Rather, on the contrary, there are good opportunities for buying exceptionally cheap euros.
Long
by Trade24Fx