Few FX Pairs Where We Are Still Waiting for a Breakout

First one is the GBPUSD pair, where the price is inside the flag formation, just below crucial long-term highs. Breakout to the upside, will give us a signal to buy.

The USDJPY pair is testing the lower line of the flag. Breakout should activate more sellers.

The EURGBP pair with a descending triangle pattern. Currently aiming its horizontal support.

The EURJPY pair testing the neckline of a big H&S pattern. That can result with a breakout.

The CHFJPY pair with a H&S pattern on a long-term resistance. Possibly an interesting trade for the sellers.

The AUDJPY pair is trying to break the upper line of the triangle but the first attempt looks bad. It is possible that a false breakout is happening right this moment.

The GBPJPY pair showing the beauty of price action. First two pennants and now very clean flag. Breakout to the upside can be a great buy signal.

For a look at all of today’s economic events, check out our economic calendar.

EUR/GBP Bullish Reversal Continues After ABC Bounce at 61.8% Fib

The EUR/GBP made a bullish bounce at the 61.8% Fibonacci retracement level. Is this a confirmation signal of an upcoming bullish reversal?

So far the EUR/GBP is developing a reversal pattern as we analysed in our previous article. This article will review what to expect next.

Price Charts and Technical Analysis

EUR/GBP 16.5.2021 4 hour chart

The EUR/GBP downtrend created a divergence pattern between the bottoms (purple lines). This is usual for a wave 3-4-5 (grey) pattern:

  1. The strong bullish impulse was the next bullish reversal signal (wave 1 pink).
  2. The bearish price action after the impulse was also corrective. A bearish ABC (grey) pattern seems to be unfolding.
  3. The bullish bounce at the 61.8% Fibonacci (green box) and the inverted head and shoulders pattern (green boxes) support the reversal too.
  4. Also, the ABC did not break the bottom of wave 1, which means it could be a wave 2 (pink).
  5. However, a break below the bottom invalidates (red button) the wave 123 (pink) pattern.
  6. A break above the long-term moving averages confirms the uptrend (green arrows).
  7. A bullish bounce at the deeper Fibonacci levels also indicates a potential uptrend (blue arrows).

On the 1 hour chart, we can see a bearish 5 wave pattern (orange) probably completed wave C (grey) of wave 2 (pink):

  1. A break below the bottom invalidates (red button) the bullish reversal and could indicate a deeper pullback on the 4 hour chart.
  2. A break above the 50% Fibonacci level makes an uptrend more likely (blue arrow). In that case, price action is breaking the 50% Fibonacci resistance.
  3. A break below the support trend line (green) could just be a simple pullback if price action respects the Fibonacci level and potential inverted head and shoulders pattern (green boxes).
  4. A bullish bounce (green arrows) could confirm the reversal up.
  5. The bullish price action seems to be completing a 5 wave (grey) leading diagonal in a wave 1 (grey) pattern.

EUR/GBP 16.5.2021 1 hour chart

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter

For a look at all of today’s economic events, check out our economic calendar.

Sterling Holds Above $1.40 as Investors Stick with Bullish Bets

The pound had risen above $1.41 for the first time since February on Monday, helped by a combination of dollar weakness, market relief over Scottish election results, lockdown easing measures and the Bank of England raising its forecast for economic growth.

Better-than-expected British GDP numbers on Wednesday also supported the pound, although a rise in the dollar after better-than-forecast U.S. inflation data unravelled some of sterling’s recent rally.

On Thursday, the pound traded at $1.4043, down marginally on the day. But the drop from the highs of earlier this week was modest given sharp falls in global stock markets and a deterioration in general investor sentiment.

Against the euro, sterling weakened 0.2% to 86.08 pence.

Analysts say a combination of a stronger UK economic rebound than expected and the belief that any Scottish independence vote pushed by nationalists is a long way off make the pound a relatively attractive currency.

“The better than expected March UK GDP yesterday underscored the bright outlook for the pound and the expected solid UK data this quarter should further support the currency,” ING analysts said in a research note.

“We expect EUR/GBP to re-test the 85 [pence] level in the coming weeks. After the latest dip in GBP speculative positioning, sterling longs should start increasing yet again.”

CFTC positioning data showed that speculators reduced their net long position on the pound in the week to May 4..

Sterling is the second best-performing G10 currency in 2021, helped by bets that Britain’s rapid vaccination drive will lead to a quicker economic rebound.

The currency has also benefited from the Bank of England beginning to taper its bond purchasing programme last week, on the back of the improving economic outlook.

Bank of England policymaker Jonathan Haskel said on Wednesday he was not too concerned about the medium-term inflation outlook in Britain, but would watch out for damage done by the pandemic to the country’s productive capacity.

British house price inflation hit its highest level since the late 1980s in April as buyers raced to take advantage of an extended tax break just as sellers retreated from the market, a survey showed this week.

(Reporting by Ritvik Carvalho and Tommy WilkesEditing by Gareth Jones and Barbara Lewis)

EUR/GBP Inverted Head & Shoulders Pattern Creates Surge Higher

The EUR/GBP is making a bullish reversal via an inverted head and shoulders pattern (blue boxes).

A bullish monthly candle could indicate the end of the bearish price swing and the start of an uptrend. Let’s review the critical patterns and targets.

Price Charts and Technical Analysis

EUR/GBP 8.4.2021 monthly chart

The EUR/GBP is moving sideways after a strong surge up. This is probably a wave 3-4 pattern (red). Let’s review:

  1. The bearish correction respected the shallow 38.2-50% Fibonacci retracement levels, which is typical for a wave 4.
  2. The bullish bounce showed strength (wave 1) and the bearish correction seems to be building an ABC pattern (purple).
  3. A break above the 21 ema zone would confirm the bullish breakout (green arrows).
  4. A break below the bottom however invalidates it (red circle).

On the 4 hour chart, price action is showing very strong bullish momentum, as indicated by our blue ECS SWAT candlesticks:

  1. The divergence pattern between the bottoms (purple lines) indicated that a reversal was likely.
  2. The breakout above the resistance trend line (dotted orange), 21 ema zone, and 144 ema close indicate that a strong wave 3 (orange) is taking place.
  3. Intra-day continuation upward is possible in the zone above the Wizz 5 towards the Wizz 6 level.
  4. Eventually a pullback via a bull flag (orange arrows) is expected to retest the Wizz 4 or 5 levels for a bounce up (green arrows).
  5. Even a pullback towards the 144 ema or previous lows should act as support could indicate a bounce up. Only a break below the bottom invalidates it (red circle).
  6. The main targets on the 4 hour chart are the Wizz 6 level at 0.8720, then 0.8775-0.88, followed by 0.8950-0.90.

EUR/GBP 8.4.2021 4 hour chart

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter

For a look at all of today’s economic events, check out our economic calendar.

Sterling Sinks to 5-Week Low vs. Euro, One-Week Low vs Dollar

By Ritvik Carvalho

LONDON (Reuters) -Sterling sank on Wednesday as profit-taking by traders after a strong first quarter for the British currency pulled it to a week’s low against the dollar and its lowest in two weeks against the euro.

The pound fell on Tuesday, losing 0.6% against the dollar and over 1% against the euro – its worst day against the single currency in five weeks as investors took cash off the table.

By 1305 GMT on Wednesday, the pound was down 0.43% against the dollar at 1.3761, having hit a one-week low of $1.3756. It traded 0.5% lower to the euro at 86.38 pence.

“The recent FX price action seems to suggest that many positives are in the price of the GBP by now and that the pound is looking quite overbought (especially in the case of EUR/GBP),” said Valentin Marinov, head of G10 FX research at Credit Agricole.

“Moreover, the GBP has recently lost its crown of a ‘G10 vaccine champion’ and, more broadly, the slowing pace of the COVID vaccinations in the UK could ultimately delay the government’s plans to reopen the economy despite the recent proclamations of PM Johnson.”

Marinov added that according to the latest polls, the upcoming local elections in Scotland could give a supermajority to the pro-independence parties – the Scottish National Party, the Greens and the newly formed Alba party.

“Given all these downside risks, we maintain our cautious medium-term outlook for the pound.”

Expectations of an economic rebound in Britain, spurred by rapid COVID-19 vaccinations, helped sterling to record its best quarter since 2015 versus the euro.

Britain began using Moderna’s COVID-19 vaccine on Wednesday in Wales just as its rollout of other shots fell to their lowest level this year due to a supply crunch caused by manufacturing problems at AstraZeneca.

Britain has surged ahead of the rest of Europe in the race to vaccinate its population, with almost half of its citizens receiving a first dose. But supply issues from its main Oxford-AstraZeneca shot have slowed progress in recent days.

Prime Minister Boris Johnson confirmed on Monday a planned reopening of the economy would take place next week.

Shops, gyms, hairdressers and outdoor hospitality areas in England will reopen. The government is also looking at a COVID-status certification system, or vaccine passport, to help reopen larger events.

(Reporting by Ritvik Carvalho; editing by Larry King and Bernadette Baum)

tagreuters.com2021binary_LYNXMPEH360GO-VIEWIMAGE

Profit-Taking Puts Sterling on Track for Worst Day vs Euro Since February

By Joice Alves

Bets on an economic recovery, spurred by a rapid COVID-19 vaccination programme, have supported sterling over the past few months.

On Monday, the pound recorded its best day against a weakening dollar since Feb. 18, as U.S. Treasury yields held below recent highs, while low liquidity with many parts of the world off for the Easter break was also seen exaggerating moves.

But as traders returned from the long weekend, cable was 0.5% lower at $1.3833 at 1030 GMT, after earlier touching $1.3919, its highest since March 19.

Against the euro, sterling hit a one-week low of 85.45 pence on Tuesday, after having its best quarter since 2015 versus the single currency.

“It is the re-opening of London this morning that is seeing sterling under some initial pressure, as sellers have returned and taken advantage of the rally seen over the last 24 hours or so,” said Stuart Cole, chief macro strategist at Equiti Capital in London.

Cole added the selling appeared to be a mixture of profit-taking and new short positions being initiated.

Market participants continued to expect further gains for the pound in the months ahead.

With the vaccine programme rolling out rapidly across Britain and infection numbers falling, Prime Minister Boris Johnson confirmed on Monday a planned re-opening of the economy would take place next week.

Shops, gyms, hairdressers and outdoor hospitality areas in England will re-open. The government is also looking at a COVID-status certification system, or vaccine passport, to help re-open larger events.

Britain will begin the rollout of Moderna’s COVID-19 vaccine in mid-April, vaccine deployment minister Nadhim Zahawi said on Tuesday, adding the inoculation programme was on track to meet government targets.

Some 12 million second doses are planned to be distributed in April.

Johnson also said on Monday his government hoped non-essential international travel would resume from May 17.

(Reporting by Joice Alves; Editing by Larry King and Mark Potter)

Could EUR/GBP Replace Cable as The Main Outlet for a Further Rally in The Pound?

At a minimum it is hard to argue against the claim that possibly sterling has entered a consolidation phase, cable seemingly caught within a broad 1.37-1.40 channel and Eur/Gbp within a narrower 0.8550/0.8700 band. However, by the same measure, sterling continues to retain most of the gains made since September, approximately 11%/9% against the dollar/euro respectively. It is this fact that suggests underlying support for the pound remains in place.

But if this is the case, and if we are in a consolidation phase, will the same dynamics be in play once this phase has passed? Specifically, with the outlook for the US economy now looking brighter, will the main outlet for renewed sterling strength be expressed against the euro, rather than the dollar? The suggestion is that this may be the case.

Progress with vaccinations

One of the key drivers behind sterling’s ascent has been the success of the UK’s vaccination programme. Significantly ahead of the EU and to a lesser degree the US, this success has provided the prospect of the UK emerging first from the burden of lockdown restrictions and presented the opportunity for a head start in its economic recovery. While the argument with the EU over the supply of AstraZeneca vaccines could cause a slight slowing in the pace of UK inoculations, the significant advantage it will still hold over the EU cannot be ignored. While this gap exists, UK prospects will remain brighter than the EU’s, providing support for the pound vis-à-vis the euro.

Early end to lockdown restrictions and better growth prospects

Lockdown restrictions are already being eased in the UK, to be completely removed by 21st June. In contrast, further restrictions are being imposed in parts of the EU, notably Germany, Italy and France, where progress with restoring economic activity appears to be going backwards rather than forwards. Unsurprisingly, the UK is expected to outperform the EU this year: the OECD forecasts 2021 UK GDP growth of 5.1% compared to 3.9% for the euro-zone. Furthermore, the balance of risk appears tilted to the topside for the UK as opposed to the downside for the EU.

This has implications for monetary policy, the BoE expected to begin tightening ahead of the ECB. Indeed, this is already anticipated in the markets, where 10-yr Gilt yields are up some 58bps since January compared to just 26bps for their German equivalent and providing an absolute return advantage of over 1%. This interest rate differential looks set to get wider, seeing the pound become increasingly attractive to international investors versus the euro.

Confidence in the UK economic recovery

The UK Government in March began laying out plans for scaling back the huge fiscal support currently provided. The jobs furlough scheme was extended one final time to end-September while taxes will start rising from next year as personal allowances are frozen. Corporation tax will also rise in 2023. Together, these two measures alone are forecast to generate some £65bn in revenue, with more tax rises expected going forward. This suggests a high degree of confidence in the strength of the UK recovery. Contrast this with the EU, where instead of focusing on recovery, officials are instead engaged in working out how to distribute the approximate Eur750bn pandemic recovery fund. The direction of travel between the UK and the EU could not be more different.

A market still underweight sterling

Finally, CFTC data suggests a market relatively underweight sterling. The latest figures (16th March) show net long sterling positions held by the asset management community to be 12,350, compared to 340,470 for the euro. This suggests a pool of untapped potential support for sterling while demand for the euro may already be satiated.

In summary

In summary, the sterling outlook remains positive, the combination of continued vaccinations, lifting of lockdown restrictions and rising yields all converging to support the pound. With the US also appearing to be moving past the worst of the pandemic, but the EU continuing to languish, the pertinent question for a resumed sterling rally might no longer be how high cable could trade, but rather how far Eur/Gbp might fall.

Opinion editorial by Stuart Cole, chief macro strategist at Equiti Capital

‘’This material is provided for informational purposes only and does not constitute financial advice, investment advice, trading advice or any other advice or recommendation of any sort offered or endorsed by Equiti Capital. This material is not, and is not intended to be, a “research report”, “investment research” or “independent research” as may be defined in applicable laws and regulations worldwide.

Please see the full disclaimer here: https://www.equiticapital.co.uk/media/11057/disclaimer.pdf ’’

EUR/USD Vs USD/JPY, Close Prices and Next Week

EUR/USD most significant high/ low point is located at 1.2026. A break however at 1.2020 represent a wholesale trend change for a lower EUR/USD. Current EUR/USD trades above 1.2026.

USD/JPY on the other side trades above its significant high/ low point at 104.72. Both EUR/USD and USD/JPY are mis aligned. Either USD/JPY remains above 104.72 and trades higher or EUR/USD must break below 1.2026 and 1.2020 to trade much lower to 1.1700’s. In the interim, both pairs are in a standoff.

Noted from USD/JPY constituents, USD/CAD trades below its high / low point at 1.2867 and USD/CHF below 0.8980. USD/JPY remains the outlier USD pair for the past two weeks.

From the January 3rd long term forecasts, the next major USD/JPY inflection point is located at 106.00 exactly and USD/JPY traded to 105.75 then dropped. While 106.00 above represents the next break, below is located the 10 year average at 103.33 and a 267 pip range.

EUR/USD however must break below its 10 year average at 1.2107 to target the vital breaks at 1.2026 and 1.2020. Above is located the 14 year average at 1.2625. As EUR/USD trades above 1.2107 then the wide range becomes 1.2625 to 1.2107 and a 518 pip range. EUR/USD overall hasn’t changed its 518 pip range since January 8 as important MA’s are dropping simultaneously.

Most important point at 1.2625 however is dropping ever so slowly week to week as is 1.2107. A much lower EUR/USD is ahead in weeks to come.

Between 1.2107 and 1.2624 exists minor daily and weekly trade points.

USD/JPY however above 106.00 exists a vital average every 100 pips until the 5 year average at 109.09. USD/JPY’s counterpart due to the exact same pair is CHF/JPY and it trades above 116.20.

For USD/JPY today, best shorts are located at 105.37 and 105.30 to target 104.90. Longs are located at 104.31 and 104.37 to target 104.64. The break at 104.72 however represents a lower USD/JPY next week.

EUR/USD close price today is forecast at 1.2109 and below 1.2137. This places EUR/USD next week between 1.2082 to 1.2137 for next week.

USD/JPY above 104.72 represents a problem for AUD/JPY as it trades above its 5 year average at 79.70 and NZD/JPY trades above its 10 year average at 75.42. Both are mandatory breaks for AUD/USD to trade lower and break its vital MA at its rising line at 0.7557 and NZD/USD 0.7070.

Any price today for AUD/JPY ar 81.57 is a good short to target 81.17 and today’s close price is forecast at 80.96.

Not only are all JPY cross pairs richter scale overbought but most trade near vital inflection points. EUR/JPY 128.24 is next above Vs below at 125.93 or a 231 pip range. Close price forecast today for EUR/JPY at 126.83 places EUR/JPY at perfect neutral to begin next week.

GBP/JPY trades deeply overbought between vital 5 and 10 year averages at 142.47 and 148.27. Good short today is found at 145.26 to target the close price forecast at 144.08. Quite a distance for a Friday. Above 144.08 then GBP/JPY remains deeply overbought heading into next week.

Overbought GBP/USD forecast close price is located at 1.3741. Shorts today are located at 1,.3866 and 1.3857 to target 1.3772 then 1.3741.

For oversold EUR/CAD, next week 1.5471 high/ low point we’re watching closely.

For high flyer and wide ranger GBP/AUD net week 1.7900 represents the big break. 1.7900 broke this week and traded to 1.7785. EUR/AUD and GBP/AUD’s counterpart must break 1.5923 to trade higher. GBP/AUD break at 1.7900 represents an alignment to EUR/AUD as both now trade below respective MA’s.

For oversold USD/CAD, close price today is forecast 1.2753. Shorts today are located at 1.2787 and 1.2773 to target 1.2731 then 1.2696.

Oversold EUR/GBP trades just above its 5 year average at 0.8725.

S&P bottom and long entry is located at 3896.71 and just ahead of 3861.36. Long target is located at 3906.58 for a quick 10 point trade today.

DAX today must trade back to at least 13970.70. Note most vital today at 13926.28 then 14029.00, 14084.78 then 14156.47. Above 13970.70 targets 14029.00.

 

Gold Disappoints While Oil and Indices Climb Higher and Higher

Gold dropped and is aiming at the 1765 USD/oz level.

Oil, on the other hand, seems to be aiming for the stars.

The DAX is in a bullish engulfing pattern on the weekly chart that looks great for buyers.

The EURUSD has dropped significantly before bouncing. Most likely the price will test the 1.206 resistance level.

The AUDUSD is aiming higher after an inverse head and shoulders pattern.

The USDCHF met a strong horizontal resistance after a nice upswing caused by the iH&S formation.

The NZDCAD is still below the crucial resistance level of 0.923.

The USDCAD in a pennant, waiting for a breakout.

The NZDUSD is in the same situation. The price will potentially see a big move ahead.

The EURGBP has dropped like a rock after the price created a massive head and shoulders pattern.

For a look at all of today’s economic events, check out our economic calendar.

M4Markets Announces New 50% Credit Bonus For Clients

Clients are eligible for a 50% Credit Bonus for each new deposit made to a verified live account. Each client can claim up to 5000 USD/EUR/GBP in bonus and get a free margin boost with every deposit made.

The promotion is designed to give a boost to the broker’s growing audience and it is expected that it will attract both beginner and experienced traders who are interested to maximize their deposits and open higher-volume positions.

Commenting on the new promotion, Group CMO, Mrs. Marilena Iakovou noted that “We are committed to offering our traders a unique trading experience and our new promotion goes a long towards achieving that goal. We expect that with this promotion, our clients will have the opportunity to experience our superior trading conditions.”

The broker is set to get a head start in 2021, by not only expanding to new regions, but also through the launch of multiple promotions that will allow traders globally to experience their trading environment.

The new promotion complements the promotion launched for the broker’s partners a few weeks earlier and it is expected that it will be followed by similar promotions in other regions within the next few months.

More information on how to participate in the promotion is available here: https://www.m4markets.com/credit-bonus/

About M4Markets

M4Markets is one of the fastest growing regulated Forex and CFD brokers with a multi-asset offering and a focus on trader experience. With low spreads and no requotes, segregated trust accounts, ultra-fast execution and regulated by the Financial Services Authority (FSA) in the Seychelles, M4Markets is one of the most trusted brokers.

EURGBP Analysis – Can the Last Support Once Again Save Euro from Plummeting

EUR/GBP has touched an important support level at 0.88700 and held above the support. As seen on a 4H chart below, Euro could be in a high danger if it goes down below that support.

Correction of December 25, 2020 has formed a sharp descending triangle and a breakout from its upper edge will signal a strong uptrend. First resistances to watch if the breakout is confirmed are 0.89440 and 0.90000. Resistance at 0.89440 is very important and further price action of the pair upon testing of this level will be decisive.

EUR/GBP quote on Overbit

On the other hand there are two other patterns one should watch when trading EUR/GBP. The chart above has formed a Head and Shoulders pattern and the support of 0.88700 acted as a neckline. Since the pair is still above the neckline there is no confirmation of the pattern, however if the pair closes lower the 0.88700 support it will continue the downtrend to 0.87900 and to 0.86900 below that to complete the Head and Shoulders pattern.

An hourly chart of EUR/GBP has another pattern formed, which supports the downtrend, the inverted cup and handle.

EUR/GBP quote on Overbit

What this pattern in general tells is that bears are in charge and after a slight correction upwards, the downtrend will continue breaking the lowest support, which in this case is 0.88700.

Factors that might support the downtrend of EUR/GBP are extensions of lockdowns in the Eurozone as the number of Covid-19 cases surge in previously highly affected regions such as Spain and Italy. The political developments in Italy also play a significant role in an economic recovery and further stability of the Eurozone. Italy was the hot zone of the Covid-19 pandemic in Europe and had the largest EU aid. The dispute in the government is related to the 750bn Euro bill, where the former PM Renzi wants to invest the money in digital economy and green energy, and the current PM Conte would like to spend 209bn Euro for Covid-19 relief.

The economic data from the UK sounds very promising as well, for instance PPI input (MoM) as per December which will be released tomorrow is expected to be higher by 0.5bp than in November, moreover Retail sales and Core retail sales data from the UK which will be announced this Friday, January 22 are looking very positive. The forecasted Retail sales (MoM) as per December is 5bp higher related to the November’s -3.8.

For a look at all of today’s economic events, check out our economic calendar.

Join the “Classics without Borders” Contest and Get Real Money Prizes

FXOpen has been pleasing traders with its Forex contests for many years, and this time it is launching the contest for beginners and those who have registered with FXOpen no earlier than January 2020. 10 best traders will share the prize fund of 1500 USD.

The “Classics without borders” contest starts on November 30, 2020 and will last until December 24, 2020. Registration is open now and will be closed on December 13, 2020.

Terms of the contest:

  • Start deposit: 5000 USD;
  • Leverage: 1:100;
  • Trading instruments: EUR/USD, GBP/USD, USD/JPY, USD/CHF, USD/CAD, AUD/USD, NZD/USD, EUR/GBP and stocks;
  • Account type: contest demo ECN;
  • Advisors and locking: allowed.

Terms for receiving the prize:

It is required to increase the initial deposit by at least 20%, and to make at least 10 trades with total volume of 10 lots. The winners will be the best 10 Equity traders who have met the above conditions.

How to join the contest?

New users must register in ForexCup and join the contest with data from your personal account. Existing FXOpen clients have to pass verification in MyFXOpen and join the competition with data from MyFXOpen or ForexCup. It should be noted that all contest accounts are blocked until the contest starts.

Please visit FXOpen broker official website to learn more.

Brexit and GBP: A “Move Week”… Maybe?

What we can comment on so far is this: eight months passed, and the EU and the UK are as far away from each other in their divorce process as they are geographically. Still, Irish Foreign Minister Simon Coveney called this week a “move week”. Can it be so indeed?

Really not sure now but let’s orient ourselves in the details of the Brexit status now.

Last week, two major Brexit architects left the camp of Boris Johnson. Lee Cain, offered a position of Chief of Staff, resigned rejecting the offer on Wednesday, and the next day, Dominic Cummings, a central figure and a key aide of the UK PM, announced he would leave duty after the New Year. There was no indication given to what exactly those departures are related to, and observers could not resist giving in to speculations on those reasons and their possible effect on Brexit.

Here, the primary negotiator from the UK side, David Frost, was quick to dissipate any doubt: the British stance will stay as adamant on its demands as it has been until now. Noting that “some progress in a positive direction in recent days”, he explained that the deal “might not succeed” – which by now is quite clear, after more than half a year of pretty fruitless discussions.

Brussels wants London to make concessions first. London wants Brussels to step back first. The UK wants freer access to its own fishing waters referring to the rights of sovereignty; at the same time, it wants to retain access to the European market because this is where most of the catch is sold. In the meantime, Europe wants to keep access to the British fishing waters as well with no desire to make it less than before. Also, it wants EU legislative bodies to be able to enforce the deals. The level playing field for business is the third crucial point where there has been little process.

In a nutshell, none of the sides wants to be the first to step back. In the meantime, EUR/GBP has already touched the summer lows of 0.8900. Why is the pound getting stronger against the euro? Psychologically, that may be explained by the fact that the GBP has more to lose. Hopes of getting Brexit straight push it against the euro, and the last months have been pretty full of hopes – and pretty much nothing more.

Note that in the long-run, the euro is still appreciating against the pound: since the beginning of the year, EUR/GBP moved from 0.83 to above 0.87, and the uptrend hasn’t been broken yet. The September-November bearish incursion may well be just the last ray of hope for the GBP before it softens. Be very careful with the supports of 0.8900 and 0.8870: if this week nothing moves, EUR/GBP may reverse to the upside once again.

This post is written and submitted by FBS Markets for informational purposes only. In no way shall it be interpreted or construed to create any warranties of any kind, including an offer to buy or sell any currencies or other instruments. 

The views and ideas shared in this article are deemed reliable and based on the most up-to-date and trustworthy sources. However, the company does not take any responsibility for accuracy and completeness of the information, and the views expressed in the article may be subject to change without prior notice. 

FXOpen Launches Apple Pay Payments

When you’re making purchases on the web in Safari on your iPhone, iPad, or Mac, you can use Apple Pay without having to create an account or fill out lengthy forms. The payment procedure takes just a touch and is faster and more secure than ever before.

Every transaction made with Apple Pay requires you to authenticate with Touch ID or Face ID developed by Apple Inc.

When you make a purchase with your iPhone or Apple Watch, Apple Pay uses a device-specific number and unique transaction code.

Learn how to set up and start using Apple Pay here.

More details:

  • Currencies: EUR, USD, GBP;
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Deposit commission is 6%. To celebrate the launch, clients can deposit for free, paying 0% commission.

Deposit via Apple Pay

Learn how to deposit via Apple Pay in our knowledge base.

Indices Try to Catch a Breath. Great Session for USD

Almost all indices collapse and aim for long-term lows.

SP500 is testing the 23,6% Fibonacci.

DAX is very close to reach the 38,2% Fibonacci.

FTSE breaks the lower line of the wedge formation.

CAC reaches crucial support from the first half of the year.

EURUSD breaks the lower line of the flag formation.

EURAUD eventually bounces from the upper line of the sideways trend.

EURGBP in a flag but with inclinations for an upswing.

AUDCHF goes lower after the bounce from a crucial resistance.

WTI Oil breaks the lower line of the symmetric triangle.

Gold goes lower after the escape from the mid-term pennant.

USDPLN breaks the neckline of the inverse Head & Shoulders pattern, it looks bullish.

For a look at all of today’s economic events, check out our economic calendar.

Tips On How To Trade The Currency Pair EUR/GBP

EUR is the Euro, the official currency of most European countries, including Italy, France, Germany, Spain, etc.

Conversely, the official currency of the United Kingdom is GPB (Pound Sterling). Both EUR and GBP currencies have higher individual values than the USD (United States Dollar). If you intend to trade the EUR/GBP, here are tips that can help you.

Tips On How To Trade The Currency Pair EUR/GBP

Understand the base and quote currency

When it comes to trading forex pairs, there’s always a base and quote currency. The pair results from a price comparison of the base and quote currency, which indicates the needed amount of the quote currency for buying the base currency.

In the case of EUR/GBP, the EUR is the base currency, as it comes first, while the GBP is the quote currency, as it comes second.

So, when it comes to trading EUR/GBP, we are looking at how much GBP is needed to purchase EUR. In other words, you are selling GBP to buy EUR.

Furthermore, there are two prices involved, which include the bid price and the asking price. The bid price is the quote currency amount for buying the base currency, while the asking price implies the quote currency amount acquired after selling the base currency.

Consider its low volatility

Volatility has to do with how fast or slow trading prices change. The forex market is volatile, considering the large number of currencies involved. However, the EUR/GBP pair has low volatility; their prices don’t change significantly very often.

As mentioned earlier, both EUR and GBP are among the most strongest currencies in the world. European countries use the Euro while the UK uses the Pound Sterling; hence, the EUR/GBP is a relatively stable currency pair, which makes them heavily traded. A major change in their prices would draw massive attention in the forex market and outside it.

Follow the economic news

When trading any currency pair via forex brokerage houses, it is ideal to follow the economic news so you don’t miss any event that could drive a major price change. This applies as well for the EUR/GBP currency pair; besides, EU countries and the UK are involved.

You should not miss important updates, including new monetary policies, capital input, capital withdrawals, inflation, etc. Notably, the short-term rates of both currencies are influenced by economic data announcements.

Therefore, you should check daily in the morning and evening for economic updates about the GBP and EUR. Furthermore, it is ideal to check political news because they can influence investor decisions.

Trade at the right hours

Trading activity in the Forex market usually reaches a peak during certain periods at major financial cities in the world. Hence, Forex trading is distinguished into three activity sessions: North America (New York), European (London), and Asian (Tokyo) sessions. Notably, the European Forex session in London starts from 7 am to 4 pm (GMT).

Although you can trade at any time in the 24/7 forex market, it is ideal to trade the EUR/GBP pair during the European Forex session; a simple way to remember this is “don’t trade when it is dark in London.”

Look out for trends

If you want to perform a profitable EUR/GBP trade, it is vital to identify ongoing trends. For the EUR/GBP pair, you should either use the EUR/GBP price analysis or a technical trend indicator.

Take, for instance, the 200-Day Period Simple Moving Average; if the chart is trending down and the prices shift below the moving average, it is a bearish trend. To avoid getting false trend signals, you should follow only short signals of the EUR/GBP pair.

Similarly, if the chart is trending up and the prices shift above the moving average, it’s an upward trend. To avoid getting false trend signals, you can follow only long signals of the pair.

Look out for correlation with other pairs

While you have your eyes set on EUR and GBP, you should always look out for other forex pairs and how they correlate. Ideally, you should look out for correlation from the past three months.

Pairs with strong correlation are likely to have EUR or GBP; For example, EUR/JPY and GBP/JPY.

With correlation, you can get trading signals for the EUR/GBP pair. Likewise, currencies with strong correlation are ideal for hedging.

Conclusion

Forex trading is a notable means for making money on the internet, while the EUR/GBP pair is a profitable one to trade.

However, as always advised, Forex trading is risky; there’s no guarantee of returns or profits. Therefore, you should only put in what you can afford to lose.

EURGBP Analysis Ahead of Fishy Brexit Talks

GBP showed significant strength on Friday amid new Brexit negotiation hopes. The deal has faced another dilemma – the fish. UK wants the EU vessels to stay out of the UK waters after the Brexit, while the EU would like to keep access to the UK waters to their vessels after the Brexit under the Common Fisheries Policy. UK officials claim that France and the Netherlands use super-trawlers to empty the UK waters and the PM Boris Johnson vowed to do everything to protect the UK fisheries.

The upcoming week will be a great test for both currencies not only by virtue of the EU summit in Brussels but as remarkable data will be published for both sides of the deal: the UK – Unemployment change, for EU – ZEW Current Conditions and ZEW Economic Sentiment. If the UK leaders are able to convince the EU leaders to accept the deal without postponing it again, the Euro may weaken and continue to fall, if it’s postponed then the GBP will fall against major currencies on weak employment data.

Asides the unemployment data, the upcoming ‘hotspot’ restrictions in the UK, which might eliminate small and medium businesses and result in a labor layoff, could back the downfall of the Pound.

The EUR/GBP pair continued the downtrend after the test of a high at 0.92924 on September 11, remarkable the day UK announced the new trade-deal with Japan.

EUR/GBP quote on Overbit

Two patterns to watch on pair’s 4H-chart are “Bullish flag” and “Triangle”. Euro remained above a crucial support and resistance level and halted the fall at 0.90680, if the pair remains above that level amid UK and EU data, it might as well continue upwards to test the dynamic resistance (upper edge of a triangle once again) at 0.91200. Below this level will result in the pair to test the following static support at 0.90490 if that support is broken then the pair will drop deeper towards 0.90100 to test the static and dynamic resistance, where the “Flag pattern” will be confirmed and the pair will most likely bounce back and continue bullish

Yet MACD is signaling the trend reversal I highly advise to trade with caution as the upcoming week will be highly volatile for both currencies.

For a look at all of today’s economic events, check out our economic calendar.

New Brexit Talks Hits GBP

The European Union is puzzled by such a proposal – trade under the WTO rules involves the restoration of full-fledged borders, which will lead to huge transport delays at the border.

Pound against USD is below the dynamic support of June 30 and a static support of 1.31700, hence GBP probably is going to continue the downtrend until 1.3100 – 1.3000, where an important support level and Fibonacci 0.382 are in position.

GBPUSD quote on Overbit

The same pattern is seen on another major pair traded against GBP – Japanese Yen. At the time of writing this article, the GBPJPY quote on Overbit is 139.576 which is below an important resistance of 139.860 – 139.900 and is below the dynamic support of June 30, hence the drop may continue down to 138.536 – minor support and Fibonacci 0.382 level and to a major support of 138.156

GBPJPY quote on Overbit

EURGBP on the opposite is gaining, the pair is currently traded above the down-trend channel and looks like it will continue the bullish run to test resistances at 0.90585 – 0.91253. If the tensions between EU and GB continue on trade regulations and none of the sides accept the trade conditions between the two, the Pound may continue the downtrend further.

EURGBP quote on Overbit
For a look at all of today’s economic events, check out our economic calendar.

EUR/GBP Reversal Prepares for Bullish Break Above 0.9050

The EUR/GBP is building a range above the 21 ema zone (green box) after breaking above the resistance trend lines (dotted purple). The EUR/GBP could be ready for a strong bullish breakout.

Price Charts and Technical Analysis

EUR/GBP 4 hour chart

The EUR/GBP needs to break above the resistance of the previous wave 4. A bullish breakout would confirm the trend and momentum change from down to up. Bullish price action could take place within a wave 3 (purple). The first target is the Wizz 6 level and the previous top. But the start of a wave 3 could push it for a new high and beyond. A bull flag pattern would help confirm the uptrend view (green check).

The EUR/GBP could also break south but the previous bottom is likely to hold. An inverted head and shoulders pattern is likely to act as support for a bullish bounce. Only a break below the bottom invalidates (red x) the current bullish outlook on the EG.

EUR/GBP 4 hour chart

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter

For a look at all of today’s economic events, check out our economic calendar.

Pound Braces for Drama as Brexit Talks Resume

After officially leaving the European Union (EU) almost 6 months ago, uncertainty remains the name of the game as both sides struggle to make headway on Britain’s future relationship with Europe.

The sixth round of Brexit talks resumes today after the previous disappointment. Sterling may be flung into the direct firing line if the United Kingdom and Europe and unable to bridge their difference on EU’s access to British fishing waters and the UK’s alignment to EU rules.

If you are looking for some action and volatility, Pound crosses could be the place to be amid fears around an extended deadlock leading to a no-deal Brexit outcome by the end of 2020.

The GBPUSD continues to ride higher on Dollar weakness with prices slamming into the 1.2670 resistance level.

Yesterday’s rebound from the 1.2550 resistance levels looks strong, with the daily close above1.2650 signalling further upside in the short to medium term. Technical lagging indicators like the 50 & 100 Simple Moving Average support the upside bias while the Moving Average Convergence Divergence (MACD) has also crossed to the upside. The current bullish momentum may send the GBPUSD towards 1.2750. Alternatively, a move back towards 1.2550 suggests that a technical correction could be in play before prices rebound higher.

GBPJPY clears 136.00

The GBPJPY entered the week on a solid note, jumping over 150 pips to clear the 136.00 resistance level. This currency pair is turning bullish on the daily charts with 137.00 acting as the next level of interest.

As the market mood improves on coronavirus vaccine hopes and EU leaders striking a deal on a landmark recovery fund, safe-haven assets like the Japanese Yen are likely to weaken. The GBPJPY is likely to ride higher on Yen weakness in the short term, with a breakout above 137.00 opening the doors towards 138.50.

On the other hand, this party could be crashed by bears if Brexit talks fall apart this week. A move back below 135.00 may inspire a decline towards 133.60 and 134.00.

EURGBP slips towards 0.9000

According to the technicals, the EURGBP is still bullish on the daily charts.

There have been consistently higher highs and higher lows while the Moving Average Convergence Divergence (MACD) trades to the upside. However, prices are trading below the 20 Simple Moving Average. A breakdown below the 0.9000 support level could signal a decline towards 0.8850. If 0.9000 proves to be reliable support, the EURGBP has the potential to rebound towards 0.9100.

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