First, a few words about the events of the past week:
- USD. Last week, more precisely on Thursday 01 and Friday, August 02, there were two events that could shake the markets. But not shaken.
On Thursday, the first time since 2008, the US Federal Reserve cut its key rate from 2.50% to 2.25%. The event is quite expected. And such a move markets usually react to a drop in prices. However, in this case, instead of falling, the dollar rose, albeit slightly (growth against EUR amounted to little more than 100 points), and a short time (as early as Friday, the euro played 85 points back).
The main reason for the growth of the US currency began to comment Jerome Powell, in which the Fed chief said that the rate cut by 25 basis points does not necessarily mark the beginning of a consistent policy easing. Indirectly, his words confirmed the fact that the rate was reduced by only 0.25% instead of 0.50%, while the two FOMC members even voted against any reduction.
Thus, the Fed was the least "soft" on the background of the central banks of other countries engaged in easing policy, which led to a short-term increase in the dollar.
The second event was planned output statistics on the US labor market. As expected, the rate of NFP fell slightly (from 193K to 164K), to which the market reacted quite slow, especially as the main newsmaker at the end of the week - the surprise of many! - said Donald Trump. (Well, where without it!)
To begin, the US president described the behavior of Powell's betrayal, and then put an end to the fragile truce in the US-China trade war, announced the introduction of c 1 September 10-percent duty on Chinese goods worth $ 300 billion. This step Trump has dramatically increased, contrary to statements by Powell's chances further easing of the monetary policy of the Fed. Thus, the probability of the next reduction rate increased from 64% to 92% in September, in December - from 42% to 75%.
The threat of a new round of fighting in a war with China brought down the US stock market, as investors once again turned their attention to a safe haven, the Japanese yen, which at the end of the week strengthened against the dollar by 275 points;
- cryptocurrency. Without a doubt, bitcoin has been, is and will be a digital currency №1, which reigns in the crypto-market, accounting for the bulk of its capitalization and identifying trends, and the quotations of the overwhelming majority altkoinov. Although sometimes there are voices that offer to provide, for example, the status of full-fledged Ethereum coin, placing it next to Bitcoin, it is unlikely to happen in the foreseeable future.
As for the news background, often determines a particular trend, he recently completely ambiguous. Thus, the largest social network Facebook announced the launch of the project to its own digital currency Libra may be canceled due to significant pressure from the regulator - the Securities and Exchange Commission USA (SEC).
On the one hand, it seems to be good for Bitcoin - Single strong competitor less. And on the other - asking Libra, the authorities may get a firm hold and crypto-market as a whole. Calls in this respect does not stop for a minute. For example, recently the US Tax Service (IRS) has sent more than 10 letters to thousands of investors with the requirement to make information about their kriptovalyutnyh assets in a tax return, threatening deviators severe penalties and prosecution.
While the BTC / USD pair continues to move in a sideways channel, trying to overcome the resistance of $ 10,500. Also sideways move with little volatility and major altkoyny including laytkoyn (LTC / USD), Ethereum (ETH / USD) and Ripple (XRP / USD). We can assume that the main reason for this tranquility is the middle of summer, when both investors and legislators, and even the tax collectors go on vacation. Although, maybe it's just the calm before the next storm.
As for the forecast for the coming week, then, summing up the views of several experts, as well as the forecasts made on the basis of a wide variety of technical and graphical analysis methods, we can say the following:
- EUR / USD. In his fall the pair is close to Pivot Point 2015-2016g.g. And, although the rebound on Friday, August 2 colored LEDs on the N4 in the gray neutral color, 90% of oscillators and trend indicators on the D1 still insist on the continuation of the downtrend. We agree with their prognosis and 65% of experts believe that the US currency has more potential for growth, and it will continue to put pressure on the euro. The next target for the pair - 1.0950, next to the 100 points lower.
At the moment, on the side of the bulls were only 35% of analysts, however, in anticipation of easing monetary policy of the Fed, the transition to the medium-term forecast of the number increases to 55%.
If we turn to the testimony of the graphical analysis, he draws on the H4 first movement of the pair in the range of 1.1070-1.1165, and then its growth to the horizon 1.1225. Next resistance at 1.1285;
- GBP / USD. Starting from April 2018 the British currency weakened against the US dollar at 2300 points. The last days were no exception - from July 25 lb "lost" for 430 points. The reason is the same - Brexit. The coming to power of Boris Johnson and his promise is already 31 October to part with the EU on the "hard" scenario make investors nervous, and the pound to fall.
75% of the experts expect to soon see the pair in the 1.2000 area. And if she manages to break this support, it is able to "fly" down 100-150 points. Support such a development trend indicators 95% and 90% on the oscillator D1.
Remaining 10% oscillators provide signals about oversold. Also expected to break graphical analysis on D1 and 25% analysts according to which steam at some time may pass to lateral movement in a channel 1.2100-1.2250. In case of any positive news regarding Brexit, not excluded pair rise to the level of 1.2375.
As for the medium-term forecast, by 70%, analysts say the Bank of England, in the end, he will be forced to recognize the serious risks "hard" out of the EU and strongly tighten monetary policy. Thus, he will be the only major Central Bank to raise interest rates, which should lead to an increase in British currency quotations and rise above the level of 1.2800. However, it can happen only when the final will be announced at least the basic conditions of the UK release of the EU;
- USD / JPY. The escalation of the trade conflict between the US and China and the decline in interest rates on the US dollar increased the appeal of the yen as a safe-haven currency. Therefore, 60% of analysts expect a further decrease in pair in an effort to reach a minimum in January 2019 in the area of 105.00. Trend indicators 100% and 85% D1 oscillators are also looking to the South. However, 15% of the oscillator signals supplied already oversold. Resistance levels 107.80, 109.00 and 110.00;
- cryptocurrency. Bitcoin holders are trying to find any arguments to push it up. For this purpose, any suitable occasions, even the Fed lowering interest rates - say, losing interest in the dollar, investors will begin to invest in higher-yielding and riskier assets like bitcoin. Although, if you think about it, that they hurt to do it before? Reduced rates by 0.25% - a very weak argument in this case.
The billionaire and the head of the crypto-bank Galaxy Digital Mike Novogratz in an interview with Bloomberg said that the price of Bitcoin end of this year will rise again to a historic high of $ 20 thousand. Per unit. However, he does not exclude that in the course of trading prices may fall up to $ 8,500 per 1 BTC. A popular host Joe Kernen broadcast channel CNBC announced the BTC rise to $ 55,000. In May 2020, mining Bitcoins will be reduced immediately to two times that, in his opinion, should lead to a rapid increase in the value of the coins, thanks to its aggressive buying before halvingom.
As for short-term forecasts, despite the fact that the August 2 bitcoin reached $ 10,650, talk about the transition to sustained growth will be possible only after the BTC / USD pair confidently step over the mark of $ 11,000. In the meantime, the experts were divided into two equal camps. But all of them, and the optimists and pessimists, as the Pivot Point is called the Horizon $ 10,000.
Roman Butko, NordFX
Disclaimer: These materials are not a recommendation to invest or guidance on working in the financial markets and are purely exploratory in nature. Trading on the financial markets is risky and can lead to complete loss of funds contributed.