Forex analysis review
Forex analysis review |
- Forecast and trading signals for EUR/USD on July 19. Analysis of the previous review and the pair's trajectory on Monday
- Analytics and trading signals for beginners. How to trade EUR/USD on July 19. Analysis of Friday. Getting ready for Monday
- Stocks rise, tech Tesla stocks fall. Why is that?
- Bitcoin is in a coma near the $31,100 level and is preparing for a massive drop
- Are there any real chances for Bitcoin to rise in 2021?
| Posted: 18 Jul 2021 07:57 PM PDT EUR/USD 5M
The EUR/USD pair didn't move last Friday. Friday's volatility was 30 points, which can be considered an absolute anti-record. Even the relatively important reports on European inflation and US retail sales did not help. Traders simply refused to react to external factors. Thus, trading was both simple and complex at the same time. Simple - because if a flat was identified in time, then the market should not have entered the market at all. Difficult - because this flat had yet to be identified. Let's try to figure out how to proceed. The first half of the European trading session was absolutely flat. The price did not even move away from the extremum level of 1.1807, so one cannot even say that any specific signals were formed around it. Subsequently, the pair's quotes still moved 10 points away from this level, however, there was no clear and accurate buy signal. Further, a relatively clear sell signal was formed when the price settled below the level of 1.1807, but it turned out to be false, and the price managed to go down only about 8 points after its formation and returned to the level of 1.1807. Therefore, when the price settled above it, short positions should have been closed. The loss on it was worth 10 points. The price went exactly along the level of 1.1807 throughout the US trading session, without forming a single sensible signal. Therefore, one should not have traded in the afternoon. The number "1" marks the time when the European Union inflation report was published, which reached 1.9% y/y, exactly in line with the forecast. The number "2" marks the time when the retail trade report was released in the United States, which turned out to be better than forecasted in June. However, as we can see, there was no reaction to either the first or the second report. EUR/USD 1H
There is nothing special to add to the previous reviews on the hourly timeframe for the EUR/USD pair, since there weren't any major changes over the past day. The pair continues to trade with low volatility and in a very limited price range. There is no trend line or channel now, so the concept of a trend is now rather vague, and by and large is simply not there. There is no downward movement now. We still recommend trading from important levels and lines on Monday. The nearest important levels at this time are 1.1772, 1.1807, 1.1881, 1.1922, as well as the Senkou Span B (1.1844) and Kijun-sen (1.1826) lines. The Ichimoku indicator lines can move during the day, which should be taken into account when looking for trading signals. Signals can be rebounds or breakthroughs of these levels and lines. Do not forget about placing a Stop Loss order at breakeven if the price moves 15 points in the right direction. This will protect you against possible losses if the signal turns out to be false. No macroeconomic reports in the European Union and the United States on Monday. Therefore, trading is unlikely to be active. Most likely, there will be flat or very weak movements throughout the day. We also recommend that you familiarize yourself with the forecast and trading signals for the GBP/USD pair. COT report
The EUR/USD pair did not gain or lose a single point during the last reporting week (July 6-12). However, the Commitment of Traders (COT) report clearly shows that professional traders continue to build up short positions in the European currency. Let's try to figure out what this means for the euro/dollar pair. A group of non-commercial traders opened 2,300 buy contracts (longs) and 14,000 sell contracts (shorts) during the reporting week. Thus, the net position of the major players has been decreasing for the third or fourth consecutive week. This time it was reduced by almost 12,000 contracts. Thus, the bullish sentiment of traders continues to weaken. However, we would like to remind you that, globally, the upward trend is maintained for the euro/dollar pair, and at this time, a correctional movement is just taking place. Also remember the global fundamental factor, which is the fact that trillions of dollars are being injected into the American economy. It still continues to inflate the US money supply. Therefore, we may again face a paradoxical picture, when the demand for the euro is falling, but the single currency itself is rising. This effect can be achieved if the demand for the dollar falls at a faster rate or the supply of the dollar grows faster. However, it is precisely the latter that has been happening all the time over the past year and a half. We have repeatedly cited data on the money supply in the United States and concluded that for the M1 aggregate it has grown several times over the past year and a half. Thus, formally, the chances of a further decline in the euro have been growing for a month, according to COT reports. And in fact, the upward trend in the EUR/USD pair can resume at any time. Explanations for the chart: Support and Resistance Levels are the levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels. Kijun-sen and Senkou Span B lines are lines of the Ichimoku indicator transferred to the hourly timeframe from the 4-hour one. Support and resistance areas are areas from which the price has repeatedly rebounded off. Yellow lines are trend lines, trend channels and any other technical patterns. Indicator 1 on the COT charts is the size of the net position of each category of traders. Indicator 2 on the COT charts is the size of the net position for the non-commercial group. The material has been provided by InstaForex Company - www.instaforex.com |
| Posted: 18 Jul 2021 12:39 PM PDT Analysis of previous deals: 30M chart of the EUR/USD pair
The EUR/USD pair moved mostly sideways on Friday. The volatility of the day was only 30 points. This review can end. Seriously though, we have to return to the topic of pair volatility again. Unfortunately, the euro/dollar pair spends 3 out of 5 trading days with low volatility, which does not allow not only earning, but also, in principle, working with it. Even if you are a genius trader, it is hardly possible to squeeze out a lot if the pair passes 30 points in a day. The technical picture on the 30-minute timeframe does not change. There is still no trend line or channel. The trend formally remains downward, but in the chart it already looks like a full-fledged flat, since the period of time when the pair was in a weak but still downward movement is far behind. Thus, it is still impossible to consider signals from the MACD indicator. As for macroeconomic statistics, two important reports were published on Friday, which did not make any impression on traders. The EU inflation report for June was published early in the morning. It reached 1.9% y/y, which is fully in line with the forecast and the previous value. Therefore, the lack of response to this report is not surprising. But the volume of retail sales in the United States in June rose by 0.6% m/m, although forecasts predicted a decline of 0.4% m/m. Thus, the US dollar had the opportunity to rise in price, but traders ignored this report. 5M chart of the EUR/USD pair
Trading on the 5 minute timeframe was terrible throughout Friday. In the sense that the pair was flat all day. And flat is false signals. It is good that only a few of them were formed, so novice traders managed to avoid losses. All three buy signals formed around 1.1796, which is the previous day's (Thursday) low. The price bounced off this level three times, so only one long position had to be opened. Further, the price simply returned to this level, which did not require closing a deal or opening new ones. The most interesting thing is that at the end of the day the price was unable to settle either below the level of 1.1796, or to reach the level of 1.1851 (the closest target), or to go up at least 30 points (for the least Take Profit). Thus, the long position should have been manually closed towards Friday evening. Hence, one could even earn up to 10 points of profit. Trading tips for Monday: There is still no trend on the 30-minute timeframe, so it is not recommended to trade on this timeframe yet. A flat is a very dangerous thing. The pair continues to show very weak volatility, so it is best to immediately switch to the lower chart, and wait for a trend line or channel at the current one. On the 5-minute timeframe, it is recommended to trade from the levels 1.1772, 1.1796, 1.1851 and 1.1880. Take Profit, as before, is set at a distance of 30-40 points. Stop Loss - to breakeven when the price passes in the right direction by 15-20 points. At 5M TF, the target can be the nearest level if it is not too close or too far away. If located - then you should act according to the situation. No reports or important events in either the European Union or the United States on Monday. Thus, it is highly likely that tomorrow the pair will experience low volatility again. On the chart: Support and Resistance Levels are the Levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels. Red lines are the channels or trend lines that display the current trend and show in which direction it is better to trade now. Up/down arrows show where you should sell or buy after reaching or breaking through particular levels. The MACD indicator (14,22,3) consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend lines (channels and trend lines). Important announcements and economic reports that you can always find in the news calendar can seriously influence the trajectory of a currency pair. Therefore, at the time of their release, we recommended trading as carefully as possible or exit the market in order to avoid a sharp price reversal. Beginners on Forex should remember that not every single trade has to be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time. The material has been provided by InstaForex Company - www.instaforex.com |
| Stocks rise, tech Tesla stocks fall. Why is that? Posted: 18 Jul 2021 08:04 AM PDT
The S&P 500 and Nasdaq indices have risen significantly in recent months and renewed their all-time highs. Only the Dow Jones did not manage to rise in comparison with its May 10 high, but still broke it. Also, strong growth was shown in recent months by shares of Apple and Microsoft. But not Tesla. Tesla shares continue to trade below the high of April 14 and well below the high of January 25, which is the all-time high. Bloomberg experts analyzed and calculated that the twenty-day correlation between the NASDAQ index and Tesla stock fell from 0.83 points to 0.14. Simply put, before the correlation was very high (the index is growing back and with a probability of 83% growth in Tesla shares), but now it is practically absent. Analysts are awaiting Tesla's earnings report due out on July 26th. And ahead of the release of this report, is it analyzing why tech company Tesla is no longer in demand among investors like Microsoft or Apple? Bitcoin is cited as the reason for the lack of demand for Tesla shares. Recall that Tesla invested $ 1.5 billion in bitcoin back in February, while Elon Musk was praising bitcoin left and right at that time. Probably, Tesla and Musk wanted to make several billion or tens of billions from cryptocurrency, provoking a sharp influx of investors into the network and an increase in the rate of "digital gold". However, few other tech companies have followed Tesla's lead. Investments in bitcoin, of course, increased after the actions of Tesla and the statements of Elon Musk, but in the past three months, bitcoin quotes have only been falling, and Tesla shares cannot show growth. Elon Musk's rhetoric has changed a lot since that time. Now the notorious billionaire criticizes bitcoin for its overly high transaction fees, its energy inefficiency, and its slowness. Tesla got rid of some of its crypto assets back in April, calling the move "testing the liquidity of bitcoin coins." However, even then we had serious doubts about the veracity of this statement. The fact is that Tesla allowed people to buy its electric cars with bitcoins for about a month, but very quickly closed this opportunity. Thus, the general picture suggests that Tesla wanted to integrate bitcoin into its activities and earn extra money on it, but this idea failed. Tesla could have sold a certain part of its crypto assets in the second quarter of 2021, but investors can find out about this only from the financial results report. If it turns out that Tesla was selling bitcoin in the second quarter, then both its shares and the value of bitcoin itself may decline even more.
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| Bitcoin is in a coma near the $31,100 level and is preparing for a massive drop Posted: 18 Jul 2021 07:23 AM PDT
The quotes of the main cryptocurrency trampled around the level of $31,100 for the third consecutive day. It has not yet rebounded or surpassed this level, and the volatility of the cryptocurrency has dropped almost to zero. So, at this time, bitcoin is being traded in a completely unusual manner for itself, and the market is "calm before the storm". Basically, at the moment, BTC quotes have dropped to the level of $31,100 for the sixth time. Most cryptocurrency experts believe that the fall in quotes will continue next week, and the absolute majority call the level of 24,000 as the nearest target. In principle, this goal coincides with our forecasts, and the reasons for a possible fall in bitcoin, which are now being called, are quite simple. Yesterday we already said that in July, investment shares of the bitcoin fund Grayscale worth around $1.4 billion will be unlocked. Simply put, these shares were "frozen" for six months, that is, the owners could not sell the bitcoin coins during this period of time. But in the month of July, they will get such an opportunity. And since the cryptocurrency rate has dropped very much over the past three months, investors can immediately rush to sell their coins. And the influx of several tens of thousands of coins to cryptocurrency exchanges can seriously crash the cryptocurrency rate. Thus, most of the crypto community is expecting another strong drop in digital gold during the remaining two weeks of July. On the other hand, Grayscale investors cannot fail to understand that it is their sales of bitcoin coins that will contribute to a new fall in the rate of this cryptocurrency. Therefore, no matter how paradoxical it may sound, they should not get rid of bitcoin, which has fallen in price over the past three months, so that the cryptocurrency rate does not fall below the level of $31,100. Either way, the next two weeks can be very interesting. Meanwhile, China is no longer the world leader in terms of mining capacity. In principle, there is nothing surprising in this, since the authorities of this country have seriously tightened their legislation regarding cryptocurrencies, and mining in this country is now simply prohibited. However, research by the University of Cambridge shows that the share of Chinese miners in the bitcoin hashrate began to fall even before the ban on mining in the country was introduced. So last year it was 65%, and in April 2021 it was already 46%. But now the United States occupies the second place in the world in bitcoin mining, and their share in the total hashrate is growing. The third place belongs to Kazakhstan, the fourth - to Russia.
Technically, bitcoin fell for the sixth time to $31,100. Thus, the cryptocurrency has already begun testing the level of 31,100 and may start testing $29,700 in the near future. From our point of view, overcoming these levels, and hence a new fall in bitcoin, is only a matter of time. Nevertheless, as long as these obstacles are not passed, "digital gold" retains purely theoretical chances of new growth to the level of 40,700. However, this also requires the desire of investors to buy bitcoin, which has not yet been observed. The material has been provided by InstaForex Company - www.instaforex.com |
| Are there any real chances for Bitcoin to rise in 2021? Posted: 18 Jul 2021 07:22 AM PDT
The main cryptocurrency continues its downward trend, which has significantly weakened in the last few days. The thing is that bitcoin quotes have fallen to the level of $31,100, which is very important for traders and investors. At least, the price has already fallen to it six times in the last two months and has failed to surpass it each time. Thus, the future prospects of bitcoin for the next couple of months depend on whether traders will be able to overcome this level. In principle, only the level of $31,100 can save it from collapsing right now. We believe that the more times the price tests this level for strength, the more chances that the next attempt will be successful. Of course, we can recall the British pound, which was trading near its 3-year highs for more than a month and even updated them, but could not overcome the level of 1.4240, after which it began to decline. However, Bitcoin is not the pound. Now all participants of the cryptocurrency market should have another issue on the agenda. When is the downward trend in "digital gold" supposed to end and does it have any prospects in the future at all? Recall that in 2020, bitcoin grew solely due to the global crisis, as well as the strongest monetary incentives from many central banks of the world. There was a banal increase in money, so a certain part of it settled on the cryptocurrency market. Now, on the contrary, the whole world is returning to its usual life and the demand for bitcoin is falling. Because bitcoin remains an extremely volatile investment tool, but not a payment tool or a savings tool. Moreover, the year 2021 showed that many governments of the world are ready to oppose bitcoin and other tokens, as they pose a threat to the financial system. Therefore, it can be assumed that in the future the legislation will only be tightened. Especially when central banks start issuing their digital money. They simply will not need competitors in the form of decentralized cryptocurrencies, which can be easily and simply banned at the legislative level. Thus, we would say that a new bullish trend in bitcoin will require a new global crisis or some global fundamental event. It is quite possible that over the next few years, bitcoin will fall to the level of $10,000 and will then trade around it until it gets a new push.
Technically, on the 4-hour timeframe, bitcoin quotes have settled below the upward trend line, as well as below the Ichimoku cloud. Also, the price dropped to the level of $31,100 per coin and has been trying to overcome it for three days. If a breakthrough occurs, then only the level of $29,700 can keep it from collapsing. Overcoming it will open the way for the bears to the $24,350 level. The material has been provided by InstaForex Company - www.instaforex.com |
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