It doesn't worth selling pounds on raising

Last week, the focus was on the British pound. It became under pressure after the announcement of the British Prime Minister Theresa on May Oct. 2 about the beginning of Brexit in April 2017. At the same time the UK has no plans to put the interests of the financial sector at the heart of the negotiations with Brussels. The statement by the President of France on the hard approach to the UK from the European Union exit added even more negativism. Even the status of the British pound as the world's reserve currency may be questioned.
Most notable was the flash crash of the pound on the night from Thursday to Friday. Within two minutes the pair GBP/USD fell by 6% to 1.1841, which is a minimum for thirty years. On some trading sections the British pound fell to $ 1.1378. Soon after that, the decline was partly purchased. There are several versions of what happened. Most likely, this was due to the actions of hedge funds or trading robots.
Currently, there are no buyers of the pound. It is necessary to recognize and understand that fact. The pair is best to be left in peace, if the short positions are already closed. If the sale is still open, you can keep them, since it is likely the reduce to be repeated to this year lows.

USD relies on aggressive rhetoric of the US Federal Reserve

The new week began for the dollar successfully. Recovering from failed to meet expectations on the employment report in the US, the currency once again is in demand amid lingering hopes for a Fed rate increase in December. Against this background, EUR/USD slippedagain under the 1.12 mark, checking out the area of ​​1.1150.
In September, there were created 156 thousand jobs against the forecast of 172 thousand. However, the release upset the market participants not too much, and they are still hoping that the regulator will start tightening policy until the end of the year. If we analyze the NFP figures for the previous three months, the average growth in the value is around 192 thousand jobs. More than decent result, especially given the continuing growth in wages. In addition, it is worth noting an increase in business activity in manufacturing and services in the country, as well as signs of increasing inflationary pressures.
Theoretically, all this creates conditions for raising the cost of lending. The probability of such a scenario in December, at the moment is about 70%. However, before the December meeting, there are still a lot of tests, which may affect this forecast. This week on focus will be the Fed's minutes on Wednesday. Also, the market will give considerable importance to data on consumer confidence and retail sales in the United States.
So, in spite of the growing confidence in raising rates and the growing optimism of the players, any significant negative signal may trigger a revision of expectations for 2017. For example, if part of the rhetoric of the Fed minutes will be not sufficiently aggressive or even wear a "pigeon" character, USD will be under pressure, and the probability of a December policy tightening will return to 50%.

How to use the Parabolic SAR

Parabolic SAR (Stop And Reversal) is based on indicators that helps us to determine when the trend is low. The indicator puts points on the graph that shows possible reversals in price. On the picture we can clearly see how the points are moved in reverse motion. It is useful for long unidirectional movements. Parabolic SAR is probably the easiest to use indicator.
As a rule, when the points are under candles - we buy, when they are above the candles - we sell.

Strong dollar, weak dollar - Consequences

The US dollar is often the standard by which other currencies are measured. A strong dollar means that the currency can buy more foreign products and services. This may be good for consumers and international travelers because they want to buy more (eg electronics) and the places they visit are cheaper.
The negative side is that US companies, which sell products and services to foreign customers, experience difficulties because the products and services cost more. This means that US producers doesn't have an advantage in the global market.
This could lead to relocation of US Business in other countries with lower costs, so that they remain competitive in the market. In other words, a strong dollar means job loss in America.
Weak dollar means that the currency buys less foreign products or services. Import prices jump. Consumers have to pay more for imports and foreign travelers may cancel their holidays because it is more expensive when the dollar is weak.
Weak dollar also means that exports become more competitive in the global market. Maybe maintaining or increasing jobs.

Free webinar: "Finally: Q4 Trading Kick-off"

On October 06 there will be a very useful free "Finally: Q4 Trading Kick-off".
The Pro trader Paul Wallace will discuss with us his game plan for the final months of 2016.
Time: 7pm-8pm Cost: Free Place: Online
Don't the other interesting and useful webinar, which will be held in October:
October 13: "Harness the power of a Virtual Private Server & MT4";
October 20: "Trading continuations with a simple pattern".
For more information and registration, visit here.

The euro moved up against the dollar by reducing the fears around Deutsche Bank

Euro compensated the fall against the dollar on Friday, after the European currency slipped to US to a minimum of nine weeks due to reduced fears about the state of the German Deutsche Bank (DE: DBKGn).
In addition, the ensuing peace of investors put pressure on the robust yen and the Swiss franc.
Traded in the US Deutsche Bank shares rose by 12.2 percent to 15.36 GMT, after falling to a record low the day before. The root cause of the bank crisis - a fine by the US Department of Justice, the amount of which may reach $14 billion, which the Bank disputes.
Assumptions about reducing fine supported the euro after the currency fell to $1.1153 in early trading session in the US. By reducing anxiety about the Deutsche Bank the dollar peaked in nine days to reliable franc at 0.9752.

GBP/USD up on positive UK data

On Friday, the pound was up against the US dollar after the economic growth of the United Kingdom in the second quarter were revised higher than expected, and an encouraging report on the UK balance of payments surplus tempered concerns about the potential adverse effects до Brexit.
In the European morning trade the pair reached 1.2986, the session high, rising by 0.17%, GBP/USD  subsequently consolidated at 1.2976.
The pair is likely to receive support at 1.2912, the low of September 23 and at one-month low and resistance at 1.3125, the high of September 22.
UK Office for National Statistics said that GDP grew by 0.7% in the second quarter compared with the previous estimate of 0.6%, although the projected growth was 0.6%.
In annual terms, GDP grew by 2.1% in the second quarter compared with the previous estimate of 1.9%, but lower than the expected 2.2%.
A separate report showed that the deficit of the current account balance of payments increased during the last quarter only to 28.7 billion pounds from 27.0 billion pounds in the first quarter, the figure was revised from a previous estimate of growth to 32.6 billion pounds. Analysts had expected the deficit in the second quarter to increase to 30.5 billion pounds.