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The best broker in Asia www.instaforex.com Daily analysts mail subscription AUD/USD. Declining unemployment and rising commodity market 2021-01-21 Australia's macroeconomic reports supported the Australian dollar during the Asian session. In particular, the key labor market data came out either at the forecast level or in the "green" zone, reflecting the recovery of this sector of the economy. In this case, the Aussie reacted correspondingly – buyers of AUD/USD headed to the level of 0.78, actively recovering the previously lost positions. The growth of the pair is also due to the weakness of the US currency: the US dollar index continues to decline, although it still holds above the 90th mark. However, the main driver for today's growth is clearly the Australian Nonfarm. The data on the labor market are important, but the published indicators should also be considered through the prism of the prospects for monetary policy in the light of RBA's latest statements. Moreover, it is worth noting that the Australian regulator currently has every reason to maintain the status quo. They will consider today's data at least until the next meeting on February 2, indicating the recovery of the Green Continent's economy. According to general forecasts, December's unemployment rate is expected to decline from the past value of 6.8% to 6.7%. This indicator has indeed declined, but one step lower – to 6.6%. This is the best result since April last year, when the Australian labor market reacted to the first quarantine restrictions. After that, the indicator sharply rose from 5.2% to 6.4%, and has not fallen below this target since then. Another sector of today's release is the growth rate in the number of employees, which fully coincided with analysts' optimistic forecasts. This indicator came out at around 90 thousand in November, with a growth rate of 180 thousand last October. In September, it declined in the negative zone, as Australia experienced another wave of COVID-19 crisis. To simply put it, it sharply rose after the indicator plummeted below zero, then showed a general decline over the next two months, although it came out at relatively high values. Based on experts' expectations, this indicator should have shown a positive trend in December – an increase by 50 thousand. In this part, the forecasts coincided with the current condition: the indicator increased at exactly in this value. It is also worth emphasizing that the growth in the number of employed in December was mainly due to the growth of full employment: the indicator of full employment rose by 35.7 thousand, while partial employment was by 14.3 thousand. It is believed that the growth in the number of full-time positions in the future will positively affect the consumer activity of Australians, and ultimately the inflationary processes. Therefore, today's result is also positive in this aspect. In addition, the share of the economically active population has increased to 66.2%, which is the best result since September 2019. It should also be recalled that Central Bank members expressed their concern during RBA's last (December) meeting. They said that labor market indicators are recovering at an "uneven" pace. According to the calculations of the Central Bank's economists, the country will still need years for unemployment to fall to the "pre-crisis" level, that is, in the range of 4.5-5.2%. At the same time, regulatory members were concerned about the growth of the indicator of part-time employment. The RBA has indicated that if the labor market does not show signs of a sustained recovery in the near future, the regulator will consider expanding the stimulus program. It should be noted that the RBA's meeting in December was held even before the data on labor market growth for November was published. In other words, the first meeting of the RBA members this year (February) will be held under the recovery sign of the main indicators of the labor market. It is very likely that the Central Bank will maintain a wait-and-see attitude, noting the above positive trends. The commodity market, in turn, also provides indirect support to the Australian currency. The cost of a ton of iron ore (a strategically important commodity for the Australian economy) rose to $ 170, which was at the level of $ 120 in October-November. Industry experts say that prices for ore increased on the back of annual growth in China's national GDP and steel production, which improved the prospects for demand for raw materials for investors. Technically, the pair in the daily time frame is between the middle and upper lines of the Bollinger Bands indicator, as well as above all the lines of the Ichimoku indicator, which is still showing the bullish "parade lines" signal. All this suggests that the pair retains its potential to further rise, at least to the first resistance level of 0.7830 (upper line of the Bollinger Bands indicator on D1). Indicator analysis. Daily review for the EUR/USD currency pair on 21/01/2021 2021-01-21 Trend analysis (Fig. 1). Today, from the level of 1.2105 (the closing of yesterday's daily candle), the market may continue to move up with the target of 1.2176 which is the resistance level (the blue bold line). After testing this level, it is possible to continue working up with the target of 1.2274 which is a pullback level of 85.4% (yellow dotted line). Figure 1 (daily chart). Comprehensive analysis: Indicator Analysis – up Fibonacci Levels – up Volumes – up Candle Analysis – up Trend Analysis – up Bollinger Bands – down Weekly Chart – up General Conclusion: Today, from the level of 1.2105 (the closing of yesterday's daily candle), the market may continue to move up with the target of 1.2176 which is the resistance level (the blue bold line). After testing this level, continue working up with the target of 1.2274 which is a pullback level of 85.4% (yellow dotted line). Alternative scenario: From the level of 1.2105 (the closing of yesterday's daily candle), the market may continue to move up with the target of 1.2176 which is the resistance level (the blue bold line). After testing this level, it will continue to work downwards with the target of 1.2063 which is a pullback level of 38.2% (red dotted line). Trading plan for EUR/USD and GBP/USD on January 21 2021-01-21 The pound and the euro went in different directions before the US session opened, which was associated exclusively with inflation data both in the UK and the EU. Nevertheless, the pound began to behave the same way with its neighboring continent while approaching the US session. And it's all about today's meeting of the Board of the European Central Bank, for which investors are beginning to prepare in advance. It should be noted that the decisions of the second central bank of the world, at least in terms of its impact on financial markets, have an impact on all currencies, without exception. The data on Europe's inflation yesterday, practically does not leave the European Central Bank any choice but to ease its monetary policy again. To do this, they have to expand the quantitative easing program. Another thing is that this measure was already applied during the previous meeting, so such a step is practically ruled out today. It is very likely that Christine Lagarde will announce the adoption of this measure during one of the next two meetings. Nevertheless, this is enough for investors' interest to shift from the single European currency towards the US dollar. And given that this currency pair accounts for more than half of the trading volumes of the currency market, this will lead to the greenback's global growth. Europe's inflation or rather deflation has been an issue for five months in a row. At the same time, the decline rate in consumer prices has invariably been at the level of -0.3% over the past four months. This is despite ECB's several attempts to fix the situation through quantitative easing. Theoretically, it should have been realized long ago that such a policy does not give the desired result. However, almost all central banks in the world continue to believe that economic problems can be solved with the help of the printing press. In view of this, the European Central Bank has no choice but to further increase the volume of quantitative easing. Inflation (Europe): It was mentioned above that the pound's initial behavior was slightly different. It rose, which is contradictory to the situation of consumer prices in the UK. Inflation accelerated from 0.3% to 0.6%. This means that the Bank of England will remain a refuge of stability and invariability of monetary policy in the near future. Thus, the pound will be near the current highs in the medium term. Nevertheless, this does not exclude its local move towards weakening, albeit only temporarily. Inflation (UK): However, do not think that things are only important in the euro area. The forecasts for the US labor market are not optimistic. The number of initial applications for unemployment benefits is expected to decline from 965 thousand to 915 thousand. What's worse is the repeated applications, which are forecasted to rise from 5,271 thousand to 5,540 thousand, since they reflect precisely long-term unemployment. It is clear that the labor market situation is clearly causing several concerns. Its recovery pace is clearly slowing down, while the unemployment rate is at risk of possibly rising. And this, despite the fact that the unemployment rate is quite high. However, no one will be interested in this today, since the applications data will be published simultaneously with the press conference of Christine Lagarde, which will be the focus of everyone's attention. Number of re-claims for unemployment benefits (US): The EUR/USD pair is moving along a correction course from the high of the mid-term upward trend located at 1.2349. As a temporary support, the coordinate 1.2060 is used, which is confirmed by the history of December 9, 2020. We can assume that the current pullback in the correction stage may end if the price holds below the level of 1.2100. This will open the way towards the values of 1.2060-1.2000. An alternative scenario in the market development will be considered if the price holds above the level of 1.2180 in the four-hour time frame, which may cast doubt on the stability of the correction course. The GBP/USD pair found a resistance again in the previous local high of the mid-term trend of 1.3690/1.3710, where there was a natural stop that led into a pullback. We can assume that the area of 1.3690/1.3710 will continue to put pressure on buyers, which will positively affect the volume of short positions, if the natural basis of the past coincides. EUR/USD: plan for the European session on January 21. COT reports (analysis of deals). Bulls determined to sustain euro's growth after ECB meeting. Must surpass 1.2130 2021-01-21 To open long positions on EUR/USD, you need: Several good market entry points were created yesterday. Let's take a look at the 5-minute chart and break down the trades. Buyers did not show much enthusiasm in the first half of the day, after the euro fell to the support area of 1.2130, which led to a breakdown of this range. The eurozone inflation data confirmed the complexity of the situation and the likelihood of increased deflationary pressures, which made it possible for sellers to maintain control over the 1.2130 level. Its reverse test created an excellent entry point for short positions, and after a while we saw an update of support at 1.2089, where I recommended taking profits. Forming a false breakout at this level immediately after Joe Biden's speech resulted in creating a buy signal. I paid close attention to this moment in yesterday's forecast for the US session. As a result, the bulls returned back to the resistance of 1.2130, which brought about 50 more points in profit. Today's focus will be on the 1.2130 level, on which the pair's succeeding direction depends. The European Central Bank will announce its decisions on interest rates and a bond buyback program in the first half of the day. There will be no changes, which can strengthen the euro's position, but only if ECB President Christine Lagarde gives a positive assessment of the prospects for the European economy. A breakout and getting the pair to settle above resistance at 1.2130 and being able to test it from top to bottom creates a good signal to open long positions in order for the euro to rise to a 1.2174 high, which we did not reach yesterday. A breakthrough of this range will only be possible after reports like the indicator of consumer confidence in the eurozone and the US labor market data, which is experiencing problems, have been released in the afternoon. Testing the 1.2174 area from top to bottom creates a good signal to enter long positions, in hopes to reach a high of 1.2220, where I recommend taking profits. If the bulls are unable to do anything in the support area of 1.2130 in the first half of the day, then it is best not to rush to buy, but wait for a downward correction to a more powerful area of 1.2089, from where you can open long positions immediately on a rebound, counting on an upward movement of 20-25 points within the day. Surpassing this level will create a new bear market. To open short positions on EUR/USD, you need: Sellers of the euro will focus on forming a false breakout in the resistance area of 1.2130. However, only a negative rhetoric from Lagarde can put the necessary pressure on the euro and lead to implementing this scenario, which will increase the pressure on the pair and open a direct road to the 1.2089 area. A lot depends on this range as it also includes the pair's succeeding growth, therefore, its breakout will result in removing a number of the bulls' stop orders and pull down EUR/USD to 1.2055, where I recommend taking profits. A new low at 1.2026 will still be a goal. If the euro rises above the 1.2130 level in the first half of the day, it is best not to rush to sell, but wait for an update of resistance at 1.2174, where forming a false breakout will be a signal to open short positions. I recommend selling EUR/USD immediately on a rebound from the 1.2220 area, counting on a downward correction of 20-30 points within the day. The Commitment of Traders (COT) report for January 12 recorded a sharp increase in long positions and a reduction in short ones. Buyers of risky assets continue to believe in a bullish trend, especially after such a large decline in the euro earlier this year, which made it possible for new large players to enter the market. Vaccination against the first strain of coronavirus continues in Europe, leading to new buyers for the euro. The likely approval of the next $1.9 trillion bailout plan for the US economy is likely to further erode the dollar. A limiting factor for the euro's growth is the risk of extending quarantine measures in February this year, both in Germany and in a number of other European countries. Thus, long non-commercial positions increased from 224,832 to 228,757, while short non-commercial positions fell from 81,841 to 72,867. Due to the sharp drop in short positions, the total non-commercial net position increased from 143,902 to 155,890 a week earlier. Indicator signals: Moving averages Trading is carried out in the area of 30 and 50 moving averages, which indicates an attempt by euro buyers to return to the market. Note: The period and prices of moving averages are considered by the author on the H1 hourly chart and differs from the general definition of the classic daily moving averages on the daily D1 chart. Bollinger Bands A breakout of the upper border of the indicator in the 1.2130 area will lead to a new wave of euro growth. A breakout of the lower boundary at 1.2089 will increase pressure on the pair. Description of indicators Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 50. It is marked in yellow on the chart. Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 30. It is marked in green on the chart. MACD indicator (Moving Average Convergence/Divergence — convergence/divergence of moving averages) Quick EMA period 12. Slow EMA period to 26. SMA period 9 Bollinger Bands (Bollinger Bands). Period 20 Non-commercial speculative traders, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet certain requirements. Long non-commercial positions represent the total long open position of non-commercial traders. Short non-commercial positions represent the total short open position of non-commercial traders. Total non-commercial net position is the difference between short and long positions of non-commercial traders. GBP/USD: plan for the European session on January 21. COT reports (analysis of deals). Active buyers noticeable with every good decrease in the pound. Bulls brace to surpass 1.3716 2021-01-21 To open long positions on GBP/USD, you need: Yesterday, 4 intraday signals to enter the market appeared at once. Let's take a look at the 5-minute chart and analyze the trades where you can and should enter the market. In my forecast for the first half of the day, I drew attention to the 1.3658 level and recommended opening positions from it, subject to a number of conditions. A breakout and being able to settle above 1.3658, followed by a downward test of this level, led to creating an excellent signal to enter the market. As a result of this entry, we managed to take around 40 points of profit, since the target in the area of the annual high of 1.3701 was reached very quickly. The pound was supported by good inflation reports. Closer to the middle of the day, in my forecast for the US session, I drew attention to forming a false breakout in the resistance area of 1.3701, where a signal to sell the pound was created and so I advised you to open short positions. As a result, the pair returned to the support area of 1.3658, which brought about 35 more points. The bulls' desperate attempts to protect this area did not lead to anything significant, but a breakout and being able to test the 1.3658 level from the bottom up in the afternoon, created another signal to sell GBP/USD, as a result of which the pair fell by another 35 points. Now pound buyers are focused on protecting support at 1.3669, since the pair's succeeding direction depends on it. Forming a false breakout there in the first half of the day will make it possible for us to expect that the pound could rise to an annual high of 1.3716, where I recommend taking profit. A breakout of 1.3716 and being able to test this area from top to bottom will hit a series of buy stop orders and lead to a new powerful bullish momentum with an exit to the highs of 1.3750 and 1.3803, where I also recommend taking profits. If the bulls cannot protect support at 1.3669 in the first half of the day, and the downward correction for the pound intensifies, then it is best not to rush into buying, but wait for an update of support at 1.3624, from which a new wave of growth was formed yesterday. However, I recommend buying the pound from there only when a false breakout is formed. If bulls are not active at this level, I recommend postponing long positions until the test of the low of 1.3585, where you can open longs immediately on a rebound, counting on an upward correction of 25-30 points within the day. To open short positions on GBP/USD, you need: Bears will do their best to regain control of the 1.3669 level, but after settling below this range and testing it from the bottom up, similar to the sell signals that appeared yesterday which I analyzed, one can count on bringing back the downward correction and returning to the 1.3624 area. We can talk about a more powerful bearish momentum when sellers have finally surpassed this range, which will open GBP/USD a direct road to the lows of 1.3585 and 1.3531, where I recommend taking profits. In case the pair grows further, one should be very careful with short positions. Forming a false breakout in the resistance of 1.3716 creates a signal to open short positions. I recommend selling GBP/USD immediately on a rebound from a high of 1.3750, counting on a slight correction of 20-25 points within the day. The Commitment of Traders (COT) report for January 12 recorded an increase in both long and short positions, but there were more of the first ones, which caused the delta to increase. Long non-commercial positions increased from 35,526 to 47,935. At the same time, short non-commercial positions increased from 31,861 to 34,993. We can see that sellers turned out to be much less than new buyers. As a result, the non-commercial net position rose to 12,942 against 3,665 a week earlier. All this suggests that traders continue to bet on the strengthening of the pound, even in the face of the new Covid-19 strain, for which there is no vaccine yet. The demand for the pound is limited by quarantine measures in the UK, which will sooner or later be canceled after the infection situation stabilizes. The Bank of England's recent refusal to introduce negative interest rates and the pound's decline earlier this year have brought many large medium-term buyers back into the market, expecting a continuation of the bull market this spring. Indicator signals: Moving averages Trading is carried out above 30 and 50 moving averages, which indicates the pair's succeeding growth. Note: The period and prices of moving averages are considered by the author on the H1 hourly chart and differs from the general definition of the classic daily moving averages on the daily D1 chart. Bollinger Bands A breakout of the upper border of the indicator in the 1.3705 area will lead to a new wave of growth. In the event of a decline, support will be provided by the lower border of the indicator at 1.3624. Description of indicators Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 50. It is marked in yellow on the chart. Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 30. It is marked in green on the chart. MACD indicator (Moving Average Convergence/Divergence — convergence/divergence of moving averages) Quick EMA period 12. Slow EMA period to 26. SMA period 9 Bollinger Bands (Bollinger Bands). Period 20 Non-commercial speculative traders, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet certain requirements. Long non-commercial positions represent the total long open position of non-commercial traders. Non-commercial short positions represent the total short open position of non-commercial traders. Total non-commercial net position is the difference between short and long positions of non-commercial traders. Trading plan for EUR/USD on January 21 2021-01-21 COVID-19 has not retreated yet. Yesterday, global incidence came close to all-time highs again. Aside from that, the pace of vaccination is still slow. Clearly, manufacturers are struggling to keep up with supplies. EUR/USD: Joe Biden's inauguration went smoothly. Now, the markets are waiting for the results of the ECB meeting, as well as the latest US employment report. Open long positions from 1.2160. Open short positions from 1.2050. Simplified wave analysis and forecast for GBP/USD and USD/JPY on January 21 2021-01-21 GBP/USD Analysis: The upward trend of the British pound led the quotes to the lower edge of the powerful resistance zone of a large TF. An incomplete wave of small scale on the main course counts down from December 21. In its structure, the final part (C) is formed. Forecast: Before the upcoming rise in the price today, it is necessary to adjust. The decline is likely no further than the estimated support. An upward mood can be expected by the end of the day or tomorrow. Potential reversal zones Resistance: - 1.3730/1.3760 Support: - 1.3630/1.3600 Recommendations: Sales on the pound market today are possible only with a reduced lot. It is necessary to take into account the limited potential of the move down. It is recommended to pay main attention to tracking signals for the purchase of the instrument. USD/JPY Analysis: The dominant direction of the price movement of the Japanese yen is set by the algorithm of the downward wave of November 9 last year. The structure has completed the middle part (B). Since January 11, the final part (C) has started. Forecast: In the next day, a mostly downward rate is expected. In the European session, a short-term price increase is possible, not further than the calculated resistance. The support zone shows the lower limit of the expected daily movement of the pair. Potential reversal zones Resistance: - 103.60/103.90 Support: - 103.00/102.70 Recommendations: There are no conditions for buying the yen today in the major market. It is recommended to track signals for selling the pair in the area of the calculated resistance. Explanation: In the simplified wave analysis (UVA), waves consist of 3 parts (A-B-C). The last incomplete wave is analyzed. The solid background of the arrows shows the formed structure, and the dotted line shows the expected movements. Attention: The wave algorithm does not take into account the duration of the tool movements in time! Indicator Analysis. Daily review for the GBP/USD currency pair 01/21/21 2021-01-21 Trend Analysis (Fig. 1). Today, the market may continue to go up from the level of 1.3652 (the closing of yesterday's daily candle) with the target of 1.3717 at the upper fractal (red dotted line). When testing this line, it is possible to continue going up with the target of 1.3826 at the upper limit of the Bollinger line indicator (the black dotted line). Figure 1 (daily chart). Comprehensive Analysis: Indicator Analysis – up Fibonacci Levels – up Volumes – up Technical Analysis – down Trend Analysis – up Bollinger Bands – up Weekly Chart – up General Conclusion Today, the price may continue to go up from the level of 1.3652 (the closing of yesterday's daily candle) with the target of 1.3717 at the upper fractal (red dotted line). When testing this line, it is possible to continue going up with the target of 1.3826 at the upper limit of the Bollinger Line indicator (the black dotted line). Alternative scenario: from the level of 1.3652 (the closing of yesterday's daily candle), it may continue to go up with the target of 1.3717 at the upper fractal (red dotted line). When testing this line, it is possible to go down with a target of 1.3577 - 21 average EMA (black thin line). Elliott wave analysis of EUR/JPY for January 21, 2021 2021-01-21 We have seen the expected dip, even though a bit deeper that our ideal target-area between 125.40 -125.50, The low has been seen at 125.23. We continue to favor short-term key support at 125.06 will be able to protect the downside for a break above minor resistance at 126.21 for a continuation higher to 127.50 and higher to 129.06. An unexpected break below 125.06 will delay our bullish view for a dip to 124.55 and maybe even closer to 123.85 before pushing higher again. R3: 126.55 R2: 126.19 R1: 125.88 Pivot: 125.63 S1: 125.36 S2: 125.24 S3: 126.05 Trading recommendation: We are long EUR from 125.75 and we have our stop placed at 125.05 Analytics and trading signals for beginners. How to trade EUR/USD on January 21? Plan for opening and closing deals on Thursday 2021-01-21 Hourly chart of the EUR/USD pair The EUR/USD pair was trading exactly as we expected last night. We can only hope that the trades during the day will go according to plan. In the meantime, the MACD indicator is sufficiently discharged, and the pair sufficiently corrected after the first upward spurt, and that night a new strong buy signal was formed (circled). Thus, novice traders had all the necessary reasons to open long positions and, if they did so, then they are already in profit by around 17 points. However, the signal has not yet been canceled and, logically, the upward movement should continue at least to the 1.2155 level, which is yesterday's high. Therefore, it is not time to leave long positions. As for short positions, you shouldn't consider them now, since we currently have an upward trend. In terms of foundation, everything will be interesting today, but quite simple. First, take note that Joe Biden's inauguration was quiet and calm. There were no riots and clashes between the protesters and the police or the National Guard. Biden took the oath, made a speech. Donald Trump also quietly and calmly left the White House and was not present at the inauguration. The results of the European Central Bank meeting will be summed up today, at which it is unlikely that any important decisions will be taken. Recall that since the spring of 2020, when the PEPP program, a program to counter the consequences of a pandemic, was adopted and approved, it has been expanded and extended in terms several times. The last time was during the final meeting for 2020, so today the ECB is unlikely to make any important decision again. We are not talking about rates at all, the ECB has not changed them for a very long time, and they remain ultra-low. Thus, the most interesting will be ECB President Christine Lagarde's press conference. Her first speech of the year was very optimistic; today there can also be a fiery speech. From our point of view, the report on claims for unemployment benefits in the US will be more interesting. If for the second week in a row there is still a tendency for an increase in the number of primary and secondary orders, then the US dollar may come under pressure from the market today and fall in price, which we, in fact, expect, considering the technical picture of the euro/dollar pair. Possible scenarios on January 21: 1) Long positions became convenient since the price settled above the descending channel. A buy signal has been generated, so at the moment you should already be in long positions. You are advised to stay in them while aiming for resistance levels 1.2150 and 1.2194. You can close long positions if the MACD indicator turns down. 2) Trading for a fall has been canceled. Now, to resume trading down, the new upward trend must be unequivocally reversed. To do this, an upward channel or trend line must be formed and then canceled. Or, the price should fall below the current local low of 1.2055. There is nothing like this yet. 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. Analytics and trading signals for beginners. How to trade GBP/USD on January 21? Plan for opening and closing deals on Thursday 2021-01-21 Hourly chart of the GBP/USD pair The upward movement resumed for the GBP/USD pair last night. Take note that yesterday the pair's quotes reached the 1.3700 level for the fourth time and rebounded off it again. However, this time the pullback to the downside was only 90 points (previously 250 and 180). Thus, there is every reason to believe that there will be a fifth attempt to surpass this level. In addition, the MACD indicator generated a buy signal last night. A downward correction by 90 points was enough for the indicator to be sufficiently discharged, so the buy signal turned out to be strong enough. Novice traders had every right to open long positions on it. Those who did so are currently in profit by around 15 points. However, the buy signal has not yet been canceled. Accordingly, it is too early to close buy orders. In general, the upward trend is maintained for the pound/dollar pair since the quotes left the downward channel. There is currently no trend line or channel to support the upward movement. The key value is still at the 1.3700 level. If the price overcomes it, the upward movement will continue. The macroeconomic calendar for Wednesday included a speech from the head of the Bank of England, Andrew Bailey. However, Bailey did not mention anything important. He only noted that GDP in September was about 10% lower than before the pandemic, and also shared his opinion that the UK economy will face a bright recovery. It is unclear what he meant by the word "bright". So far, we can conclude that there will be no recovery in the first quarter of 2021. Therefore, perhaps, "a bright recovery, but much later." Moreover, British Finance Minister Rishi Sunak said that "the economy will contract even more before starting to recover." There are no major events planned in the UK to date, so everyone is focused on the reports on US unemployment claims. Although, given how persistently the pound is rising, it hardly needs support from weak (presumably) reports from America. Possible scenarios on January 21: 1) Long positions became relevant when the pair settled above the descending channel. A new strong buy signal was formed last night. Therefore, novice traders should already be in long positions while aiming for 1.3700 and 1.3760. The upward movement may stop again around the 1.3700 level, but we are inclined to believe that it will still surpass it during the fifth attempt. Thus, there is no reason to close longs at the moment. 2) Selling has lost its relevance since the price left the upward channel. There is no evidence that the upward trend is over. So far, there is no reason to open short positions. In the near future, a rising channel may appear, and you can finally open new shorts when the price has settled below it. 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 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. Trading recommendations for starters on GBP/USD and EUR/USD for January 21, 2021 2021-01-21 The US dollar gained local support yesterday, but this did not result in anything dramatic in the market. The data on UK inflation was published on the economic calendar. It accelerated from 0.3% to 0.6%, which positively affected the pound's value at the time of the statistics release. The Eurozone also published its inflation data, which confirmed not the best expectations. The inflation rate has been falling for five consecutive months and the scale of deflation is -0.3%. The price of the euro declined during the time these statistics were published. What happened on the trading chart? The EUR/USD pair returned to the limits of the range of 1.2130/1.2170 after rebounding from the local high (1.2059) on December 9. This negatively affects the volume of long positions (buy positions). It was precisely from this range that a round of short positions appeared yesterday. The GBP/USD pair reached again the resistance area of the mid-term upward trend of 1.3690/1.3710, where a local pullback of 90 points occurred. However, the pair continued to focus on the peak of the trend. Trading recommendations on EUR/USD and GBP/USD for January 21, 2021 The weekly data on US unemployment claims will be released today, which is expected to rise. Volume of repeated applications for benefits is expected to grow by 129 thousand. Volume of initial applications is expected to decline by 55 thousand. USA 13:30 Universal time - Applications for benefits The main event is the European Central Bank (ECB)'s meeting, which has no choice but to further expand the quantitative easing program again, after the release of inflation data. Such a rapid easing of monetary policy can greatly frighten investors, which will lead to the euro's weakening. EU 12:45 Universal time - ECB meeting results 13:30 UTC+00 - Press conference and ECB commentary on monetary policy If we analyze the current trading chart of the EUR/USD, it can be seen that the price range of 1.2130/1.2170 still negatively affects buyers in terms of reducing the volume of long positions. We can assume that if the quote still fails to consolidate above the level of 1.2170 in the H4 time frame, then sellers will have a chance to resume the correction course in the direction of 1.2060-1.2000. As for the current trading chart of the GBP/USD, it can be seen that the quote is moving within the local high of the mid-term upward trend, where the area of 1.3690/1.3710 will continue to put pressure on buyers. This may affect the volume of long positions. There will be a rebound in the direction of 1.3630-1.3550 if the previous significant area of 1.3690/1.3710 will be broken again. It is worth considering that the breakdown of the 1.3690/1.3710 area and the continuation of the medium-term trend can only be considered if the price holds above the level of 1.3710 in the daily time frame. Elliott wave analysis of GBP/JPY for January 21, 2021 2021-01-21 GBP/JPY peaked at 142.34 before the expected correction into the support-area between 141.06 - 141.29 was seen. GBP/JPY saw a perfect test of the bottom of this support-area and should now be headed higher again to above the minor peak at 142.34 as the underlying uptrend gathers upside momentum. Short-term solid support is seen at 141.40 with key-support seen at 140.33. R3: 142.34 R2: 142.01 R1: 141.80 Pivot: 141.73 S1: 141.61 S2: 141.40 S3: 141.21 Trading recommendation: We are long GBP from 140.71 and we have moved our stop higher to 141.00 Technical Analysis of EUR/USD for January 21, 2021 2021-01-21 Technical Market Outlook: The EUR/USD pair bounce has been rejected at the level of 1.2154, which is the lower level of the short-term supply zone. The market reversed back tot he level of 1.2088 and is trading horizontally around this level. In order to move higher, the bulls must continue to bounce towards the next levels: 1.2163 and 1.2177. If those level are violated, then the supply zone is gone and the next target is located at the level of 1.2212. On the other hand, any failure here will reverse the bounce and the market will continue the down move towards 1.2060 again. Weekly Pivot Points: WR3 - 1.2304 WR2 - 1.2263 WR1 - 1.2147 Weekly Pivot - 1.2111 WS1 - 1.2005 WS2 - 1.1985 WS3 - 1.1848 Trading Recommendations: Since the middle of March 2020 the main trend is on EUR/USD pair has been up. This means any local corrections should be used to buy the dips until the key technical support seen at the level of 1.1609 is broken. The key long-term technical resistance is seen at the level of 1.2555. The market made the Falling Wedge trend reversal pattern around the levels of 1.2200 - 1.2300 and now the corrective cycle might have started. Any violation of the level of 1.2154 supports the trend change/corrective cycle scenario. Technical Analysis of GBP/USD for January 21, 2021 2021-01-21 Technical Market Outlook: The GBP/USD pair has broken above the local technical resistance seen at the level of 1.3624 and made a new swing high at the level of 1.3716. However, the market pulled-back again towards the level of 1.3624 and only a sustained breakout above the level of 1.3708 will trigger another wave up, so the bears continue to defend the range located between the levels of 1.3708 - 1.3667. The strong and positive momentum supports the short-term bullish outlook. Market conditions slowly approach the overbought levels. Weekly Pivot Points: WR3 - 1.3982 WR2 - 1.3839 WR1 - 1.3718 Weekly Pivot - 1.3586 WS1 - 1.3464 WS2 - 1.3322 WS3 - 1.3204 Trading Recommendations: The GBP/USD pair keeps developing the up trend and the trigger for this trend was the breakout above the level or 1.3518 on the weekly time frame chart. The recent top was made at the level of 1.3702. All the local corrections should be used to open a buy orders as long as the level of 1.2674 is not broken. The long-term target for bulls is seen at the level of 1.4370. Technical Analysis of AUD/USD for January 21, 2021 2021-01-21 Overview : The AUD/USD pair will continue to rise from the level of 0.7733. The support is found at the level of 0.7733, which represents the 50% Fibonacci retracement level in the H1 time frame. The price is likely to form a double bottom. Today, the major support is seen at 0.7695, while immediate resistance is seen at 0.7733. Accordingly, the AUD/USD pair is showing signs of strength following a breakout of a high at 0.7750. We expect to see a strong reaction off this level to push price up towards 0.7775 before 0.7733 support (50% of Fibonacci retracement, horizontal swing low support). So, buy above the level of 0.7750 with the first target at 0.7806 in order to test the daily resistance 1 and move further to 0.7828. Also, the level of 0.7847 is a good place to take profit because it will form a new double top at the same time frame. Amid the previous events, the pair is still in an uptrend; for that we expect the AUD/USD pair to climb from 0.7733 to 0.7847 in coming five days. At the same time, in case a reversal takes place and the AUD/USD pair breaks through the support level of 0.7695, a further decline to 0.7625 can occur, which would indicate a bearish market. Trading recommendations : The AUD/USD pair has climbed along a steep, upward-sloping support channel since two weeks, the pair rose at an even more ambitious incline. According to the previous events the price is expected to remain between 0.8 and 0.83 levels. Buy-deals are recommended above 0.7733 with the first target seen at 0.7806. The movement is likely to resume to the point 0.7825 and further to the point 0.7847. However, the decending movement is likely to begin from the level 0.7695 with 0.7660 and 0.7625 seen as targets. Technical Analysis of USD/JPY for January 21, 2021 2021-01-21 Overview : The trend of USD/JPY pair movement was controversial as it took place in the downtrend channel. Due to the previous events, the price is still set between the levels of 104.01 and 103.03, so it is recommended to be careful while making deals in these levels because the prices of 104.01 and 103.03 are representing the resistance and support respectively. Therefore, it is necessary to wait till the downtrend channel is passed through. In the H1 time frame, the level of 104.01 is expected to act as major resistance today. Currently, the price is moving in a bearish channel. This is confirmed by the RSI indicator signaling that we are still in a bearish market. The price is still above the moving average (100) and (50). Then the market will probably show the signs of a bearish market. In other words, sell deals are recommended below the price of 104.01 with the first target at the level of 103.03 . From this point, the pair is likely to begin an descending movement to the price of 102.61 with a view to test the weekly support at 102.19. Forecast : If the pair fails to pass through the level of 104.01, the market will indicate a bearish opportunity below the strong resistance level of 104.01. In this regard, sell deals are recommended lower than the 103.03 level with the first target at 102.61. It is possible that the pair will turn downwards continuing the development of the bearish trend to the level 102.19. However, stop loss has always been in consideration thus it will be useful to set it above the last double top at the level of 104.41 (notice that the major resistance today has set at 104.41). Daily key levels : Major resistance: 104.80 Minor resistance: 104.41 Pivot point: 103.51 Minor support: 102.61 Major support: 102.19 Comment - The trend is still calling for a strong bearish market from the spot of 104.01. - Sellers are asking for a high price (104.01). - Please check out the market volatility before investing, because the sight price may have already been reached and scenarios might have become invalidated. EUR/USD: ECB to discuss issues on monetary policy 2021-01-21 US dollar has grown weak amid hopes that the new administration, led by Joe Biden, will launch a larger stimulus program. Biden's administration is expected to continue pushing a near $ 2 trillion plan to accelerate economic recovery, however, its adoption has one hindrance. This is the promotion through the Senate, where only two loyal Republicans can help him. Aside from that, Biden and his candidate for Secretary of the Treasury, Janet Yellen, hinted that they will retain a super-soft fiscal policy this year, at least until a more stable economic growth begins. They also mentioned that the US will need more incentive measures and faster spread of the COVID-19 vaccine, which helped allay fears of higher tax rates under the Democratic administration. Yellen has pledged to "go bigger" on stimulus to revive the economy hit by the coronavirus pandemic. But Biden's proposed program has received a skeptical response from two Senate Republicans, whose support he will likely need to get through Congress quickly. The media has repeatedly pointed out that Biden needs the support of Senators Mitt Romney and Lisa Murkowski. However, these two senators have said that "it is too early to consider a new stimulus program". "We have just adopted a program that has invested over $ 900 billion," Romney told reporters yesterday, stressing that he does not yet see the need for a new economic stimulus. Meanwhile, Murkowski said she agrees with Biden that another round of assistance is needed, but it would take much longer to think over all the details of the new proposal. On a different note, the European Central Bank will hold a meeting today, during which the members will discuss issues on monetary policy. Serious restrictions, which were introduced in November last year and may be extended this January, as well as slower vaccinations in the EU (against coronavirus) threaten a double recession in the EU economy early this year. The new strain of the virus, plus tougher quarantine measures in Germany amid high incidence rates, do not give investors confidence in the future, although the latest reports on the ZEW index suggest otherwise. Therefore, markets await the announcements of ECB President Christine Lagarde, who is currently optimistic. Last week, Lagarde said the outlook last December was good, and that the eurozone will have a great economic recovery this 2021. In fact, at the last meeting, the ECB decided to increase the bond purchase program by another € 500 billion, which should be enough to stimulate economic growth. Aside from that, the ECB has certain reasons for optimism, which are inflationary pressures, deferred consumer demand and a quite stable situation in the labor market. All this is expected to lead to explosive growth rates similar to those that have been observed in the third quarter of last year. Therefore, the ECB forecasts that the EU economy will grow by 3.9% this year. However, the likelihood of a double recession has increased since last December, and many banks have lowered their forecasts to accommodate tighter restrictions imposed by Germany. Many also worry over how the ECB will regulate bond yields, and how it will act to maintain the current minimum difference between the yields of the strongest and weakest economies in the eurozone. A number of investors fear that the ECB has long adhered to specific yield levels at a time when it tries to limit the growth of bond yields in weaker European countries. The current high volume of bond purchases will partially explain why the spread between Italian and German debt remains stable, despite the fact that the Italian government is constantly increasing spending and inflating the budget deficit. The difficulty for the ECB, in contrast to other countries that can firmly regulate profitability, is that it must satisfy the monetary needs of 19 countries at once, each of which issues its own debts and relies in due measure on certain assistance at a time of crisis. To add to that, the economies of EU countries are different from each other, which results in endless disputes and discontent. In any case, regarding the EUR/USD pair, the upward climb continues, but if the quote returns to 1.2080, the euro will collapse towards 1.2030 and 1.1980. The bull market will remain only if the quote breaks above 1.2175, as only by that will the euro be able to move up towards 1.2230 and 1.2280. On the topic of statistics, a report published yesterday indicated that confidence in US home builders declined in January this year, having fallen to 83 points, from 86 points last December. The NAHB noted that a serious shortage of building plots made it difficult to meet high demand, and the rise in material prices had outstripped the rise in home prices. The fall in the main index is associated with the decrease in all three sub-indices. Make money Deposit funds Author's today's articles: Irina Manzenko Irina Manzenko Sergey Belyaev Born December 1, 1955. In 1993 graduated from Air Force Engineering Academy. In September 1999 started to study Forex markets. Since 2002 has been reading lectures on the technical analysis . Is fond of research work. Created a personal trading system based on the indicator analysis. Authored the book on technical analysis "Calculation of the next candlestick". At present the next book is being prepared for publishing "Indicator Analysis of Forex Market. Trading System Encyclopedia". Has created eleven courses on indicator analysis. Uses classical indicators. Works as a public lecturer. Held numerous seminars and workshops presented at international exhibitions of financial markets industry. Is known as one of the best specialists in the Russian Federation researching indicator analysis. Alexandr Davidov No data Maxim Magdalinin In 2005 graduated from the Academy of the Ministry of Internal Affairs of the Republic of Belarus, law faculty. Worked as a lawyer for three years in one of the biggest country's company. Besides the trading, he develops trading systems, writes articles and analytical reviews. Works at stock and commodity markets explorations. On Forex since 2006. Mihail Makarov - Vyacheslav Ognev Vyacheslav was born on August 24, 1971. In 1993, he graduated from Urals State University of Economics in the Russian city of Ekaterinburg holding a degree in Commerce and Economics of Trade. In 2007, he started concentrating on the Russian stock market, trading stocks on the RTS Stock Exchange and futures contracts on FORTS. Since 2008 he has been engaged in analyzing Forex market and trading currencies. He is an author of a simplified wave analysis method. He has also developed a trading strategy. At present, Vyacheslav is a co-author of training materials on two web portals dedicated to Forex trading education. Interests: fitness, F1 "Experience is the best of schoolmasters, only the school fees are heavy." - Thomas Carlyle Torben Melsted Born in November 1962. Graduated from CBS, got Diploma in Finance. Began trading on Forex in 1986 and since that time held various positions such as advising clients, hedging client flows on FX and commodity markets. Also worked for major corporations as Financial Risk Manager. Uses Elliott wave analysis in combination with classic technical analysis, and has been using a Calmar Ratio of 5.0 for over 3 years. Has his own blog, where he uses Elliott wave and technical analysis on all financial markets. Stanislav Polyanskiy Graduated from Odessa State Economic University. On Forex since 2006. Writes analytical reviews about international financial markets for more than 3 years. Worked as a currency analyst in different finance companies for a long time including the biggest companies of Russia and Ukraine. Vladislav Tukhmenev Vladislav graduated from Moscow State University of Technologiy and Management. He entered the forex market in early 2008. Vladislav is a professional trader, analyst, and manager. He applies a whole gamut of analysis – technical, graphical, mathematical, fundamental, and candlestick analysis. Moreover, he forecasts the market movements using his own methods based on the chaos theory. Vladimir took part in development of trading systems devoted to fractal analysis. In his free time, Vladimir blogs about exchange markets. Hobbies: active leisure, sporting shooting, cars, design, and marketing. "I do not dream only of becoming the best in my field. I also dream about those who I will take with me along the way up." Sebastian Seliga Sebastian Seliga was born on 13th Oсtober 1978 in Poland. He graduated in 2005 with MA in Social Psychology. He has worked for leading financial companies in Poland where he actively traded on NYSE, AMEX and NASDAQ exchanges. Sebastian started Forex trading in 2009 and mastered Elliott Wave Principle approach to the markets by developing and implementing his own trading strategies of Forex analysis.  Since 2012, he has been writing analitical reviews based on EWP for blogs and for Forex websites and forums. He has developed several on-line projects devoted to Forex trading and investments. He is interested in slow cooking, stand-up comedy, guitar playing, reading and swimming. "Every battle is won before it is ever fought", Sun Tzu Mourad El Keddani Was born in Oujda, Morocco. Currently lives in Belgium. In 2003 obtained B.S. in Experimental Sciences. In 2007 obtained a graduate diploma at Institut Marocain Specialise en Informatique Applique (IMSIA), specialty – Software Engineering Analyst. In 2007–2009 worked as teacher of computer services and trainer in a professional school specializing in computer technologies and accounting. In 2005 started Forex trading. Authored articles and analytical reviews on Forex market on Forex websites and forums. Since 2008 performs Forex market research, and develops and implements his own trading strategies of Forex analysis (especially in Forex Research & Analysis, Currency Forecast, and Recommendations and Analysis) that lies in: Numerical analysis: Probabilities, equations and techniques of applying Fibonacci levels. Classical analysis: Breakout strategy and trend indicators. Uses obtained skills to manage traders' accounts since 2009. In April 2009 was certified Financial Technician by the International Federation of Technical Analysts. Winner of several social work awards: Education Literacy and Non-Formal Education (in Literacy and Adult Education in The National Initiative for Human Development). Languages: Arabic, English, French and Dutch. Interests: Algorithm, Graphics, Social work, Psychology and Philosophy. Pavel Vlasov No data Subscription's options management Theme's: Fundamental analysis, Fractal analysis, Wave analysis, Technical analysis, Stock Markets Author's : A Zotova, Aleksey Almazov, Alexander Dneprovskiy, Alexandr Davidov, Alexandros Yfantis, Andrey Shevchenko, Arief Makmur, Dean Leo, Evgeny Klimov, Fedor Pavlov, Grigory Sokolov, I Belozerov, Igor Kovalyov, Irina Manzenko, Ivan Aleksandrov, l Kolesnikova, Maxim Magdalinin, Mihail Makarov, Mohamed Samy, Mourad El Keddani, Oleg Khmelevskiy, Oscar Ton, Pavel Vlasov, Petar Jacimovic, R Agafonov, S Doronina, Sebastian Seliga, Sergey Belyaev, Sergey Mityukov, Stanislav Polyanskiy, T Strelkova, Torben Melsted, V Isakov, Viktor Vasilevsky, Vladislav Tukhmenev, Vyacheslav Ognev, Yuriy Zaycev, Zhizhko Nadezhda Edit data of subscription settings Unsubscribe from the mailing list Sincerely, Analysts Service If you have any questions, you can make a phone call using one of the InstaForex Toll free numbers right now: 1 866 8000 719 0 8000 51 88 99 0 800 898 548 1 800 882 528 001 803 017 910 0 800 500 329 822 140 799 8 800 080 5553 Other countries +7 (499) 7042343, +7 (812) 4580351 E-mail: support@instaforex.com InstaForex Group is an international brand providing online trading services to the clients all over the world. 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