Forex. Euro/dollar forecast (EUR/USD)
On Friday, the European currency showed a fall against the background of the results of the meeting of the European Central Bank, however, after the speech of the ECB Head Mario Draghi and the Minister of Economy of Italy Luigi di Mayo, generally positively perceived by the market, there was growth euro/dollar to 1.1400.
The statements of the ECB that inflation is expected to rise by 1.7% in 2017-2019 have had a positive impact on the market. The regulator reiterated the likely increase in the interest rate by 10 basis points in 2019.
On Friday, European stock markets again showed a decline, following a downtrend set by U.S. indices. For example, the Stoxx Europe 600 fell 0.77% on Friday, falling 2.5% during the week. As Friday's session began with lower oil prices, European markets sagged amid sell-offs in the mining sector. Negative dynamics in the stock markets was a factor of pressure on the euro during the trading session.
Preliminary data of US GDP growth in the third quarter of 3.5% with a projected 3.4% positively affected the dollar. Consumer spending increased by 4.0% in the reporting period. Foreign trade data reflected a 3.5% drop in exports and a 9.1% increase in imports, which had a negative impact on the dollar.
At the beginning of the new week, the euro may show positive dynamics due to the fact that positive economic forecasts from the EU are expected, and the American statistics, which will be released on Monday, may negatively affect the dollar.
The projected resistance levels for the euro/dollar pair were at 1.1420, 1.1440 and 1.1465.
Forex. Pound/dollar currency pair forecast (GBP/USD)
On Friday, the pound/dollar pair fell to a local high at 1.2780, before recovering to 1.2830, thus following a similar euro dynamics.
The dynamics of the pound/dollar pair will continue to be determined by the progress of the Brexit negotiations. Many Conservative MPs are seriously considering the so-called "Plan B" and are positive about the Norwegian scenario for the UK with a simultaneous discussion of the trade agreement and a negative view of the transition period.
A hearing in the House of Lords is scheduled for Monday that the Government plans to withdraw its notice on the European Union Treaty and propose, through the Council of Ministers, to continue free trade as well as to settle issues of residency and security of EU citizens before moving on to any financial agreement in the Brexit negotiations.
Today is also expected to publish a report on the autumn forecast of the UK Treasury, which is an important indicator of the current state of the British financial system. In addition, the data on the volume of net lending and mortgage lending in the UK will become known.
Today, the dollar can be supported by data from the base price index of personal consumption expenditures in the United States. Income and expenditure statistics are one of the main indicators used by the Federal Reserve to determine inflation and therefore are of interest to investors.
Given the news context of Brexit, on Monday we expect the pound/dollar pair to fall against the backdrop of hearings in the House of Lords to support levels of 1.2800, 1.2790 and 1.2770.
Forex. Gold price forecast
On Friday, gold managed to recover and strengthen to three-month highs, but by the end of the session after positive reporting of the United States, the price fell sharply to the level of 1233 dollars per troy ounce.
The U.S. stock market on Friday continued its decline on the back of data reporting by technology companies, which turned out to be worse than forecasts. Volatility in stock markets was a supporting factor for gold last week, and will continue to be so. In the coming week, a new release of the quarterly reporting of the American giants from the S'P 500 is expected, and on Monday the market's attention will be focused on the report of Mondelez.
Investors also expect the Federal Reserve to react to the sell-off in stocks. Apparently, the regulator does not intend to back down from the policy of raising rates, and investors fear that the current market correction may be replaced by a full-blown recession.
Among the other factors that will determine the movement of gold quotes – the expectation of the midterm elections in the United States and the imposition of Iranian sanctions, against which investors will seek to hedge the risks of more stable assets.
On Monday, we expect the gold rate to rise against the background of negative dynamics in the stock markets and the possible weakening of the dollar. In addition, today is expected a new phase of confrontation in the U.S.-China trade war and hearings in the WTO of complaints filed by China and a number of other countries against the U.S. in connection with metal tariffs.
In our forecast for Monday, we expect resistance levels to be tested at 1235, 1238 and $1,242 per troy ounce.
Forex. North American Oil Forecast (WTI)
On Friday, the market closed at $67.50 per barrel of WTI crude oil, although during the day the asset became cheaper due to fears of an oversupply of raw materials in the markets. Also a factor of negative impact on oil were sell-offs in stock markets. Thus, the oil market is on the decline for the third week in a row, periodically showing a short-term correction against the background of the news agenda.
At the end of the week, the data on the increase in the number of drilling rigs at the end of the past week, provided by Baker Hughes, are able to set a trend today. The number of active rigs increased by 2 units from 873 to 875, the highest since March 2015. The growth in the number of drilling rigs is insignificant, but together with the increase in commercial reserves of American oil for the fifth week in a row, it is able to cause fluctuations in the market, as it will serve as a signal for sellers to pull back the price of oil quotes.
Fears of the relationship between supply and demand in the market were a factor in the growth of oil quotes by the end of the trading session. Statements by the head of the Saudi Energy Department that Riyadh intends to increase oil production to 11 million barrels per day are causing bewilderment to investors because of their contradictions. It is not clear to oil traders why to increase production in the context of the general downtrend of energy prices, and whether Saudi Arabia will abandon its intention.
In addition, the rise in oil prices was influenced by the news that China, the world's largest importer of oil, refuses to supply raw materials from Iran due to the approach of sanctions on November 4.
On Monday, we expect oil to continue to fall amid fears of an oversupply, especially given that Germany announced its intentions to print a strategic reserve of oil reserves on Saturday, and markets feel the possibility of substitution. In addition, stock markets also do not foreshadow stability, which will affect the exchange rate of oil quotes. Investors will prefer oil to less volatile assets.
In our forecast for Monday we expect a decline in quotations to resistance levels of 67.30, 67.10 and 66.80 dollars per barrel.
Forex. Cryptocurrency forecast
By Friday evening, the average price of Bitcoin was about $6,542, which is broadly equivalent to the value of the main cryptocurrency on Thursday.
Ethereum ended the week at $204, showing a slight drop compared to Thursday.
On Friday, ripple was asked for an average of 0.4660 dollars, the cryptocurrency decreased from Thursday's mark of 0.468 dollars.
The beginning of the coming week is notable because on Monday it is planned to launch public trading of the Venezuelan cryptocurrency El Petro. This spurs demand among Venezuelan citizens for Bitcoin as a protective asset, because the government obliges them to carry out certain transactions exclusively with the national cryptocurrency, which instills uncertainty in the government's actions. economic measures.
Also recently it became known that the payment system Visa does not exclude the possibility of working with Bitcoin and other cryptocurrencies, as stated by the CEO of the company, which can be a positive signal for the market.
On Friday, Ripple's third-quarter financial statements more than doubled to $163.33 million in the second quarter. Institutional investors accounted for a high percentage of sales. The first quarter's financial performance remains the highest. Ripple's positive reporting may encourage crypto-traders to pay attention to XPR.
In our forecast for Monday, Bitcoin is expected to grow moderately to resistance levels of 6630, 6680 and 6710 dollars.
For Ethereum, we expect the downtrend to continue with subsequent consolidation, with resistance levels at $202, 200 and $195. Ripple is more prone to volatility than Bitcoin and Ethereum, it is possible to change the morning downward dynamics to the subsequent growth, while the cryptocurrency can target resistance levels of 0.4745, 0.4765 and 0.4800 dollars.