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Cable ticked higher in early Monday's trading, following strong downside rejection and bullish close on Friday.

Weaker dollar offers temporary support to sterling, with idea of stronger recovery being supported by formation of bullish divergence on daily Stochastic / RSI.

However, pound remains heavy on Brexit concerns, with downbeat UK Manufacturing PMI data (May 49.4 vs 52.0 f/c and 53.1 prev) adding to negative signals.

Upside attempts were so far capped by falling 10SMA (1.2656), but stronger upticks on price adjustment cannot be ruled out.

Bearish bias is expected to remain in play while the price action holds below 1.2747 (27 May high / lower top of larger downtrend), with dips below 1.25 handle expected on violation of Fibo support at 1.2508 (76.4% of 1.1930/1.4376 rally).

Only sustained break above 1.2747 would sideline bears and allow for recovery towards key barriers at 1.2779 (20SMA) and 1.2796 (Fibo 38.2% of 1.3179/1.2559).

Res: 1.2656, 1.2705, 1.2747, 1.2779
Sup: 1.2625, 1.2605, 1.2559, 1.2508

The common European currency has depreciated about 121 base points against the Japanese Yen since Friday's trading session. The currency pair tested the lower boundary of a junior descending channel pattern during the first part of today's trading session.

If the support level formed by the bottom border of the channel pattern holds, a surge towards a resistance cluster formed by the weekly pivot point and the 50-hour simple moving average at 121.56 could be expected within this session.

On the other hand, if the EUR/JPY exchange rate breaks the junior descending channel, the pair might aim for the 120.00 marks in the short-term.

The Australian Dollar has appreciated about 57 base points against the US Dollar since Friday's trading session. The currency pair tested a resistance cluster formed by the combination of the weekly and the monthly pivot points at 0.6960 during the morning hours of today's session.

By and large, it is likely that the AUD/USD exchange rate will might a brief retracement towards a support cluster formed by the 50– and 100-hour SMAs at 0.6924 during the following trading session.

However, the currency exchange rate could reverse from the current price level at 0.6942 and continue surging today.

Cryptocurrency refers to any digital currency that involves cryptographic technologies. Today, cryptocurrency is one of the fastest growing classes of trading assets, which represents great possibilities for making the profit.

Cryptocurrency is characterized by gradual growth and drop in rate, as well as abrupt changes. Like any other asset, the cryptocurrency rate is driven by various factors. The rate depends on supply and demand in the market. But there are also other factors that influence the cryptocurrency price movements.

What influences the price of cryptocurrency?

Supply and demand. First, the cryptocurrency rate depends on the balance of supply and demand – this is a market law. While cryptocurrency is popular and is in demand, it will rise in price. And vice versa, if the offer is high, and demand is low, the price will fall. The rapid change in the balance of supply and demand causes price ups and downs. Any leaps on the chart encourage traders to buy or sell.

Digital currency is subject to high volatility, which makes it a suitable tool for trading. The exchange rates are constantly fluctuating. In just one day, any digital currency may increase by 10-15% or even double in price.

Both large investors and small traders who want to make money on price fluctuations trade crypto. One of the easiest ways to start the acquaintance with cryptocurrencies is to open a trading account with a forex broker. Most brokers offer their clients trading with digital currencies. JustForex offers its clients to trade 13 cryptocurrency pairs with competitive spreads from 0, and leverage up to 1:3.

Regulation of the cryptocurrency. One of the most important factors at the moment, which can seriously affect the situation in the cryptocurrency market. Both the news about the prohibition of a particular digital currency or the industry as a whole, and the recognition of Bitcoin as a means of payment influence the rate.

Infrastructure news. Everything that makes Bitcoin closer and its use more easily affects market quotes. The emergence of crypto ATMs, collaboration with the largest payment systems, support of bitcoin payments by the largest retailers or cafes and restaurants – this kind of information has a great effect on market dynamics and price growth.

Hacker attacks. There is nothing good to expect from such news. Reports about hack are likely to drive prices down. The market responds instantly, and its intensity depends on the authority of the site that was attacked.

Listing of coins on top exchanges. Listing of cryptocurrencies, as well as delisting, inevitably causes a change in rate. Information that any new cryptocurrency will be added to the exchange heightens the interest in it. In most cases, adding a cryptocurrency to the exchange leads to an increase in the popularity, and hence the liquidity of the cryptocurrency. Listing is rather a positive event that can lead to an increase in price. Delisting is almost always a sign of a significant drop.

It can often be noted that as soon as a new coin appears on the cryptocurrency market, it attracts many investors seeking to earn on a sharp increase in its price. As a rule, this growth is brief.

News in the media. The volatility of the cryptocurrency rate is largely based on the hype that constantly keeps up the interest. A sharp drop in the rate can be influenced both by the post on a social network and an intentional utterance by a well-known personality of the cryptocurrency world. In the field of cryptocurrency, news really has a significant influence on the situation on the market.

However, the news may be fake. In such circumstances, the investor will go into a minus. To prevent this, JustForex broker recommends to use only verified news sources, as well as analyze news on several sources because you can run into unsupported statements.

Downside risks have dominated the USD/CAD currency pair since Friday's trading session. As a result, a breakout occurred through the lower boundary of an ascending channel pattern at 1.3516 during the morning hours of today's session.

Given that a breakout had occurred, it is likely that the US Dollar will continue to lose strength against the Canadian Dollar within this session. The potential downside target will be near the 200-hour simple moving average at 1.3473.

However, a support level formed by the weekly pivot point at 1.3481 could provide support for the currency exchange rate today.

Upside risks have dominated the New Zealand Dollar against the US Dollar since last week's trading session. As a result, a breakout occurred through the upper boundary of a descending channel pattern at 0.6532.

Most likely, the NZD/USD currency pair might make a brief retracement towards a support level formed by the 100-hour simple moving average at 0.6528 within this session.

If the 100-hour SMA holds, the currency exchange rate will continue its upward swing during the following trading session.

As the race for UK Prime Minister position continues, former Foreign Minister Boris Johnson pledged to leave EU on time on October 31, with or without a deal. He said "If I get in we'll come out, deal or no deal, on October the 31st." On other policies he said "Now is the time to unite our society, and unite our country. To build the infrastructure, to invest in education, to improve our environment, and to support our fantastic NHS (National Health Service) ... To lift everyone in our country, and of course, also to make sure that we support our wealth creators and the businesses that make that investment possible."

Current Foreign Minister Jeremy Hunt also said he's prepared for no-deal Brexit in there was no alternative. He told BBC Radio "In the end, if the only way to leave the European Union, to deliver on the result of the referendum, was to leave without a deal, then I would do that... But I would do so very much as a last resort, with a heavy heart because of the risks to businesses and the risks to the union."

CHF Rallies on Brexit Fears

EURCHF dropped sharply to 1.11197 low, breaking below key technical support levels. Trades will have to go back to 2017 to find new levels. With political risk premia rising in Europe, participants are rotating into the closest safe-haven trade. This week’s SNB meeting will include verbal interventions including the threat of currency purchases and deeper negative rates. However, the threshold for SNB physical interventions remains high. Weak CPI release today indicates that expectation for a shift toward tighter monetary policy is mistaken. USDCHF will further benefit from the “risk-off” environment is now seeing wider CHF strength key support is located .9953. Especially, considering expectations that a dovish Fed could prompt speculation of two rate cuts in 2019. CHF status as the regional safe haven play will continue to benefit CHF against G10 (exception JPY). The catalyst in our view for the sever CHF move was Trump visit to Britain which has fortified “hard” Brexit worries. Trump strong support for Nigel Farage will only charge the Brexit base, which is coming off a strong EU election win.

INR rebound is about to turn

Optimism over the reelection of PM Narendra Modi business-friendly policies for a second five-year term and a rebound of manufacturing PMI at 3-months high have given INR a big push in the past few days. There is however good reasons to adopt a more bearish approach looking ahead, as the Reserve Bank of India rate decision from Thursday or rising trade tensions should go against INR.

The release of 1Q GDP at 5.80% (prior: 6.60%), largely below consensus of 6.30%, and lowest in five years due to a slowdown in major components agriculture and manufacturing, confirms the view that a recovery for 2Q is subdued. Despite a rebound in May manufacturing PMI, maintained in growth territory for the 22nd consecutive time, it appears that the gauge is largely influenced by recent election headlines as foreign order demand fuels needs for Indian firms to ramp up production. Yet the new administration will be facing tough challenges as election promises to boost the economy (i.e. more aggressive lending to support rural areas, expand tax cuts for middle-class families) needs to be balanced amid larger borrowing and a wider fiscal deficit (expected along 3.40% of GDP in 2019). The RBI should therefore play an important role in that regard, as lower interest rates should ultimately support Indian government fiscal policy, at the expense of the Indian rupee though. Accordingly, we should expect the RBI to announce a third consecutive 0.25 percentage point rate cut of its Repurchase rate on Thursday. There is therefore much to be expected in taking long positions on USD/INR looking forward, as fears of trade disruptions would also threaten India’s economic growth.

WTI contract remains in red on Monday, following sharp, nearly 10% fall on Thu/Fri and spiked to ne low at $52.10 in early Asian trading. Mild recovery was seen during late Asian / early European trading, as bears showed hesitation after cracking 200WMA ($52.64) and ahead of key Fibo support at $51.61 (61.8% of $42.36/$66.58). Oil price came under increased pressure on fresh tensions between the US and Mexico, as President Trump announced the US would impose tariffs on all goods from Mexico. The latest news added to existing fears about the consequences of trade war which would slow global growth and reduced demand for energy. Bearish studies add to negative sentiment, however, oversold conditions suggest the price may consolidate before resuming steep downtrend from $66.58 (23 Apr high). Limited recovery is expected before fresh weakness, with extended upticks expected to stay below falling daily Tenkan-sen ($57.54). Sustained break through 200WMA and Fibo support would signal extension of current third wave of five wave cycle from $66.58, towards its 200% Fibonacci Expansion at $50.83 and possible attempts towards psychological $50 support. Two large bearish daily candles (Thu/Fri) weigh and add to negative outlook.

Res: 53.41, 54.47, 55.00, 56.16
Sup: 52.64, 52.10, 51.61, 50.83

EUR/USD

Current level - 1.1167

Still within the consolidation boundaries between 1.1110 and 1.1220 and a clear break on the downside is needed in order to provoke a dip to 1.1015.

USD/JPY

Current level - 108.20

The pair is approaching 107.70 support area and the latter should provide a base for reversal of the whole slide since 109.90 peak.

GBP/USD

Current level - 1.2647

Intraday allow a brief climb towards 1.2690 area, followed by a dip to 1.2470.