| Analysis and forecast for EUR/USD on February 5, 2021 2021-02-05 Following the results of yesterday's trading, the main currency pair of the Forex market, in the truest sense of the word, collapsed. Thus, the assumption that the US dollar has ended its downward cycle and moved to a large-scale strengthening across a wide range of markets is confirmed. If we look specifically at the EUR/USD currency pair (which is exactly what we are currently doing), it becomes obvious that the prospects for the US economy and the timing of its recovery from the crisis caused by the COVID-19 pandemic are more favorable than in the zone where the single European currency moves. In all honesty, today's employment reports in the United States should confirm (or refute) such an opinion. Let's take a closer look at today's labor market data and the expectations associated with the upcoming reports. So, today, at 14:30 London time, the US Department of Employment will provide data on the labor market for the first month of this year. As a rule, bidders pay the closest attention to three indicators. This is a change in the number of people employed in non-agricultural sectors of the economy, where the forecast is very modest. As economists expect, in January, only 50 thousand new jobs were created in the world's leading economy. Naturally, such a small figure is a consequence of the serious coronavirus epidemic in the United States. Another important indicator is unemployment, which is projected in January at the same level as it was previously 6.7%, that is, no changes are expected here. As noted in many previous articles, investors are paying close attention to the growth of average hourly wages, as this indicator affects the level of inflationary pressure in the United States. And inflation in the US, as you know, has long been a headache for the Federal Reserve System (Fed). According to analysts' expectations, in January of this year, wages will grow by 0.3%. Given that the previous figure was 0.8%, this is a very acceptable figure. In general, the forecasts for today's labor reports are by no means overstated, rather the opposite. The greater the chance that the releases will come out not worse, but rather better than expected, which will further strengthen the US dollar against all major competitors. Daily 
Yesterday's fall ended for the euro/dollar at 1.1963. The daily chart clearly shows that after the breakdown of the strong support zone 1.2060-1.2050, which held the quote for a long time, the pressure on the pair increased significantly, which is not surprising. Most often, this is exactly what happens in the market. As a result of yesterday's fall, the EUR/USD pair broke through the black 89 exponential moving average and closed trading not only below the most important psychological level of 1.2000 but also under the 50th level of the Fibonacci grid, stretched for growth of 1.1601-1.2349. Thus, at the moment, we get another confirmation that the trend for the main currency pair has changed from bullish to bearish with a high degree of probability. According to the classics of technical analysis, the passage of the 50th level of the Fibo from a particular movement indicates that this is no longer a correction, but a change in the trend. Today's trading is still extremely important because the pair is balancing near the lower border of the daily cloud, risking falling out of it. If this happens, we will get another confirmation that the trend for EUR/USD has changed to bearish, and therefore, we need to prepare for sales. Today I do not recommend opening new positions on EUR/USD, and I will explain why. First, during the current weekly trading, the pair has already sunk significantly, and on the last trading day, against the background of profit-taking, there may be some rate adjustment, which is better to skip, since purchases against the current and very strong bearish trend are too risky and very dangerous for the deposit. Secondly, the data on the labor market is always increased volatility, nervousness, as well as any possible surprises. Do you need it? I believe that it is better to observe everything that comes while sitting "on the fence", and on Monday, taking into account the closing of today's and weekly trading, analyze and build further trading plans during the week. For those who still definitely want to trade today, I recommend considering sales after a short-term rise in the price area of 1.2000-1.2020. Seasonal spread of COVID-19 opens up new opportunities for EUR/USD bulls 2021-02-05 A strong economy means a strong currency. For those who have forgotten this basic principle of fundamental analysis, the way to the scaffold is open. The US dollar is poised to post its best weekly performance since October as investors finally woke up from the euphoria of the end of 2020 and began to reason sensibly. Yes, the S&P 500 rally continues. Yes, the global risk appetite is growing. But can the US dollar be considered the main safe-haven currency if Treasury yields are skyrocketing? They can already be used when playing on the difference because the rates for German counterparts are significantly lower. Wouldn't it be better to turn to economic growth in such a situation? If in mid-2020 one of the main drivers of the EUR/USD rally was more effective management of the pandemic in the EU compared to the United States, then in terms of the speed of vaccine spread, the Americans clearly put the Europeans under the belt. In the United States, 27.2 million people, or 8.1% of the total population, were vaccinated against COVID-19. In the European Union - 10.7 million or 2.4%. Whoever defeats the coronavirus faster will quickly return to the trend in terms of economic growth. And so far, rates in the US are winning, which allows the dollar to grow. Usually, when the difference in the expected growth rates of US GDP and the rest of the world widens, the USD index goes up. Dynamics of the USD index and the difference in GDP growth rates 
Does the euro have no chance? Of course, it does. According to research from the University of Michigan, COVID-19 is highly seasonal. It peaks in late January and early February, after which the number of infected people begins to decline. This is confirmed by Nordea Markets data, according to which European countries and the United States are gradually moving away from extreme values for infections. If so, then in the next 4-8 weeks the restrictions will be lifted and the economies will exit lockdowns. We all remember very well how this turned out for EUR/USD in late spring to early summer. Infection rate compared to peaks 
The pent-up demand and an increase in the speed of vaccine distribution in the EU could fundamentally affect forecasts and give a shoulder to euro fans. Currently, the IMF expects that at the end of 2021, US GDP will be 1.5% more than at the beginning of 2020, and its European counterpart - 3.3% less. If the last figure improves, the EURUSD bulls will launch a counterattack. The authority of Mario Draghi, who undertook to save Rome in the midst of a political crisis, should also play into the hands of the euro. At one time, the former head of the ECB saved the euro, his authority in the ranks of various parties in Italy is great because in his previous post he did a lot for the country. Reducing political risks is another argument in favor of buying the main currency pair. Technically, the Wolfe Wave pattern is forming on the daily EUR/USD chart. Its activation requires a breakout of the 2-4 line and a return to the high of the bar at point 3. Both levels are located near the 1.208 mark. Its breakout will be the reason for buying the euro. For those who prefer to be proactive, it makes sense to start forming long positions in the event of a successful assault on the resistance at 1.199-1.2. EUR/USD, daily chart 
EUR/USD analysis for February 05, 2021 - Overbought intraday condition and potential for downside towards 1.1955 2021-02-05 Senate adopts budget measure to fast-track Biden's $1.9 trillion stimulus plan For some context, the resolution here would clear the path for Biden's stimulus plan to pass if there is only a simple majority instead of going with the 60-vote threshold for most legislation to be passed in the chamber. That said, there are some caveats as the bill will have to keep below $1.9 trillion in any case and not include non-fiscal provisions or otherwise the filibuster comes into play. Further Development 
Analyzing the current trading chart of EUR/USD, I found that the buyers got exhausted today and the downside continuation is very likely to happen. Price reached upper Bollinger band, which is another sign of overbought condition... Key Levels: Resistance: 1,2000 Support levels: 1,1970 and 1,1953. Analysis of Gold for February 04,.2021 - Second target reached at $1.803 adn potetnial for another down move and test of $1.765 2021-02-05 BOE's Broadbent: QE not necessarily the first choice for stimulus BOE will take decisions on monetary policy options if and when needed - Guidance remains that BOE won't even begin to think of withdrawing support until there are clear signs of sustainable recovery and inflation
The headline is more to the fact that they are not shutting the door to negative rates at this point in time but make no mistake, QE remains their most preferred option at the moment unless economic conditions worsen considerably. Further Development 
Analyzing the current trading chart of Gold, I found thatGold reached my second downside target at $1,803 but there is still potential for more downside towards $1,765. Key Levels: Resistance: $1,803 Support levels: $1,784 and $1,765. Weekly Ichimoku cloud analysis for Gold 2021-02-05 Gold price was mainly under pressure this week. Bulls were unable to hold price above $1,850 and pushed price below $1,800. Short-term support levels were broken and Gold price remains vulnerable to a move lower as long as $1,850 holds as resistance. 
Gold weekly candlestick has entered the weekly Kumo (cloud). This is not a good sign. Resistance by the tenkan-sen (red line indicator) is at $1,871. The upper cloud boundary is at $1,820. Bulls need to break above the cloud in order to hope for a move higher. But it seems that bears are gaining control of the trend. Price is vulnerable to a move towards the lower cloud boundary at $1,759. The week we are about to close below the weekly lows of the past 8 weeks. If bulls do not step in to push price above $1,850, next week might see Gold price below $1,750.
Author's today's articles: Ivan Aleksandrov  Ivan Aleksandrov Igor Kovalyov  Igor Kovalyov was born on September 24, 1985. Igor graduated from Krasnoyarsk State University with a degree in Philology and Journalism. He has a wide experience as a newspaper and information agency correspondent. He got interested in financial markets in 2001. He also graduated from Moscow State University of Economics, Statistics, and Informatics (MESI) with a degree in Global Economics and then served as an analyst in an investment company. He has been working at InstaForex since 2014. Petar Jacimovic  Petar was born on July 08, 1989 in Serbia. Graduated from Economy University and after has worked as a currency analyst for large private investors. Petar has been involved in the world of finance since 2007. In this trading he specializes in Volume Price Action (volume background, multi Fibonacci zones, trend channels, supply and demand). He also writes the market analytical reviews for Forex forums and websites. Moreover Petar is forex teacher and has wide experience in tutoring and conducting webinars. Interests : finance, travelling, sports, music "The key to success is hard work" Alexandros Yfantis  Alexandros was born on September 14, 1978. He graduated from the ICMA Centre, University of Reading with the MSc in International Securities, investment and Banking in 2001. In 2000, Alexandros got the BSc in Economics and Business Finance from Brunel University, UK. In 2004, he began trading on the Greek stock market, where Alexandros got a specialization in international derivatives. Alexandros Yfantis has worked in a top financial company in Greece, responsible for the day-to-day running of the International markets department. He is a certified Portfolio Manager and a certified Derivatives Trader. Alexandros is also a contributor and analyst using Elliott wave and technical analysis of global financial markets. In 2007, he started Forex trading. He loves his profession and believes that entering a trade should always be accompanied by money management rules. His goal is to find profitable opportunities across the markets while minimizing risk and maximizing potential profit. "I'm still learning" Michelangelo
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