2023 Market Forecast by Solidecn.com

Commercial Content Analysts
581

US Dollar Index Analysis

The US Dollar Index is currently trading in a tight range this Friday morning. The market is in a state of anticipation as it awaits the release of the US Non-Farm Payrolls (NFP) report, a key event this week.

The index remains above the trendline support at 106.01, following a two-day pullback from its 2023 peak at 107.03. This pullback appears to be a healthy correction of the larger uptrend, providing an opportunity for traders to re-enter the bullish market at better levels.

Daily studies continue to support a bullish outlook, suggesting a potential renewed push through the critical resistance zone at 107.00. A break above this level would signal a continuation of the bullish trend.

However, today’s direction will likely be influenced by fundamental factors as traders seek more information about the state of the US labor market. This information will directly impact the Federal Reserve’s perspective on future interest rates.

Job growth in the US is expected to slow slightly in September (NFP Sep 170K forecast vs Aug 187K), but the unemployment rate is anticipated to decrease from a 1 ½ year high (Sep 3.7% forecast vs Aug 3.8%). Wage growth is expected to remain strong (Sep 0.3% vs Aug 0.2%).

These forecasted numbers suggest that the US labor sector remains robust and is least affected by high borrowing costs among the economy’s key sectors. Any expected easing is not likely to significantly impact the overall positive outlook.

In such conditions, the Federal Reserve may opt for another rate hike by year-end or more likely, maintain tight monetary policy for some time. This is because recent drastic measures to control inflation have not yet had the desired impact on the economy.

Two other reports from the US labor sector released earlier this week showed mixed results. Job openings rose well above forecasts, while hiring in the private sector fell significantly last month.

If the September NFP report exceeds expectations, it would reinforce the Federal Reserve’s hawkish stance and further support the dollar. However, if the NFP report misses expectations, demand for the dollar would ease.

Initial direction signals are expected on a sustained break of trendline support (bearish) or a lift above pivotal barriers at 107.00 zone (bull

Resistance: 106.96; 107.13; 107.88; 108.79.

Support: 106.01; 105.50; 105.13; 104.32.

582

EURUSD: Euro Struggles Amid New Geopolitical Concerns

The Euro is facing renewed pressure, nearing the 1.05 mark due to fresh geopolitical issues in the Middle East. Investors are gravitating back towards the US dollar, a traditional safe haven currency.

Despite a brief surge on Friday, where the Euro almost reached 1.06 after the announcement of new US jobs, it’s back under pressure. This surge was in line with my previous predictions, where I suggested not betting on the US dollar below 1.05 due to a potential strong response from the Euro.

However, this response was short-lived due to escalating tensions in the Middle East following a Palestinian attack on Israel. If not for this, the Euro’s rally might have lasted longer. Friday’s job report was a boon for the US economy as it exceeded expectations, reinforcing the labor sector as a key strength and helping to keep inflation in check. There’s still a slim chance that the Federal Reserve might increase rates again.

Friday afternoon’s exchange rate behavior was deceptive. The announcement of new jobs led many investors to back the dollar, only to close their positions at a loss soon after. The Euro’s strong response, resulting in weekly gains after 11 straight weeks of losses, serves as a reminder of its resilience under pressure. The future is uncertain with new factors coming into play. Increased geopolitical instability could cause unpredictable shocks in global markets.

It might be wise to adopt a wait-and-see approach. However, I still believe in buying the Euro on dips and particularly at new local lows.

583

Bitcoin is better than digital Gold

Bitcoin and gold are both seen as valuable assets, according to a recent report by Matrixport. Bitcoin’s popularity has surged due to its digital nature, making it a desirable asset. Currently, Bitcoin’s market value is $540 billion, which is about 10.8% of the total value of physical gold. Gold ETFs, on the other hand, are worth $200 billion.

The report suggests that if the U.S. Securities and Exchange Commission (SEC) approves a Bitcoin ETF, it could attract an investment of $20 - $30 billion. This could potentially cause a significant increase in Bitcoin’s value. However, the SEC has been slow in making a decision on this matter and has postponed all new applications until October. Despite this, the crypto market remains optimistic about the potential influx of mainstream investment.

Interestingly, Bitcoin has an advantage over gold. You can remember your private keys, which means there’s no risk of them being taken away.

Matrixport’s head of research, Markus Thielen, pointed out that storing wealth in gold is becoming less popular in today’s digital age. It also has limitations when it comes to international transactions. In contrast, Bitcoin allows for quick and discreet transfers of value across borders.

In conclusion, given the current technological advancements, Bitcoin serves two main purposes. It acts as a store of value similar to gold and as a speculative financial asset.

584

XAUUSD Technical Analysis

Our XAUUSD analysis shows Gold (XAU) is in a correction phase against the US Dollar (USD). It’s moving below the Ichimoku Cloud, indicating a bearish trend. We expect a rise to 1860 before falling to 1775. This could change with a breakout above 1885 or below 1875. These are predictions based on current trends and technical analysis.

585

EURUSD Technical Analysis

The EURUSD currency pair is currently following a downward trend, even though there has been a recent increase in its value.

There are certain points, known as resistance points, which could potentially halt the currency pair’s upward movement. The first resistance point could be at 1.0617, which is where the recent high value was observed. Another resistance point could be at 1.0673, which aligns with the 34-day simple moving average (SMA), a trend indicator.

Further up, the 100-day and 200-day SMAs might also act as resistance points near the value of 1.0830.

On the other hand, if the value of the currency pair starts to decrease, it might find support (a level where the price might stop falling) near the recent low values of 1.0480 and 1.0440.

586

AUDUSD

The AUDUSD currency pair has seen a slight decrease in value in the early European trading hours on Tuesday. This comes after a small increase during the Asian trading hours, which was influenced by positive economic data from Australia and dovish remarks from officials of the Federal Reserve on Monday.

However, this recent upward trend faced some resistance and had difficulty breaking clearly above the 0.6400 zone. This zone was previously a Fibonacci support level but has now turned into a resistance level, further strengthened by the 20-day moving average (20DMA). When we look at the daily chart, technical indicators suggest a bearish trend. The 14-day momentum is in negative territory and the price action is being suppressed by a falling daily cloud. These factors suggest that the recent four-day recovery might be losing momentum.

The price action during Tuesday’s Asian and early European sessions formed a bearish candle with a long upper shadow. This adds to the initial warning of a stall, which would become more likely if the price falls further and closes below the 10-day moving average (10DMA) at 0.6375. If this happens, it would shift the near-term focus lower again and could lead to a retest of last week’s new low for 2023 at 0.6285.

On the other hand, if the price can sustain a break above the 0.6400 zone, it would be an initial sign that the recovery might continue. However, for this signal to be confirmed, we would need to see an acceleration through the falling 55-day moving average (55DMA) at 0.6458.

Resistance levels are at: 0.6403; 0.6432; 0.6458; 0.65.

Support levels are at: 0.6375; 0.6360; 0.6312; 0.6285.

587

USDJPY

The USDJPY currency pair has seen a resurgence of momentum on Tuesday, although it continues to trade within a range that has persisted for four consecutive days.

The currency pair’s pullback from its 2023 peak of 150.16 has consistently found support at the rising 20-day moving average (20DMA), currently at 148.58, indicating strong buying interest.

The broader uptrend from the 2023 low of 127.22 remains unbroken, and the near-term price action suggests a minor correction before the bulls take over once again.

A close above the 10-day moving average (10DMA) at 149.12 would provide an initial bullish signal, paving the way for a retest of key resistance levels at 150.00 (a psychological level) and 150.16 (the high for 2023). These levels are just below the peak for 2022 and a multi-decade high of 151.94.

The daily chart shows strong positive momentum, with the Tenkan-sen and Kijun-sen lines in a bullish configuration. The price action is also supported by a rising and thickening daily Ichimoku cloud, keeping the focus on further upside potential.

However, traders should be cautious if the price breaks below the 20DMA, as this would weaken the near-term structure. A move and close below the spike low of 147.29 from October 3rd would be required to sideline the bulls and signal a deeper correction.

Resistance levels to watch are at: 149.12; 149.53; 150; and 150.16.
Support levels to watch are at: 148.00; 147.29; 146.1; and 145.9.

588

AUDUSD

The AUDUSD currency pair has seen a slight decrease in value in the early European trading hours on Tuesday. This comes after a small increase during the Asian trading hours, which was influenced by positive economic data from Australia and dovish remarks from officials of the Federal Reserve on Monday.

However, this recent upward trend faced some resistance and had difficulty breaking clearly above the 0.6400 zone. This zone was previously a Fibonacci support level but has now turned into a resistance level, further strengthened by the 20-day moving average (20DMA). When we look at the daily chart, technical indicators suggest a bearish trend. The 14-day momentum is in negative territory and the price action is being suppressed by a falling daily cloud. These factors suggest that the recent four-day recovery might be losing momentum.

The price action during Tuesday’s Asian and early European sessions formed a bearish candle with a long upper shadow. This adds to the initial warning of a stall, which would become more likely if the price falls further and closes below the 10-day moving average (10DMA) at 0.6375. If this happens, it would shift the near-term focus lower again and could lead to a retest of last week’s new low for 2023 at 0.6285.

On the other hand, if the price can sustain a break above the 0.6400 zone, it would be an initial sign that the recovery might continue. However, for this signal to be confirmed, we would need to see an acceleration through the falling 55-day moving average (55DMA) at 0.6458.

Resistance levels are at: 0.6403; 0.6432; 0.6458; 0.65.

Support levels are at: 0.6375; 0.6360; 0.6312; 0.6285.

589

Gold

Our latest gold market analysis shows a rise in gold prices to $1,859, following a rebound from the $1,805 support area. Key indicators, including the RSI and stochastic indicator, suggested a potential rise. A bullish engulfing candlestick pattern near the $1,805 support on the daily chart signals a potential market reversal.

On the 4H chart, gold price is grappling with a non-linear trendline and RSI near level 70. However, a significant barrier at the $1,883 pivot point suggests a stronger bearish scenario. We suggest a sell stop at 1,849, targeting 1,806, with risk at 1,870.

Always do your own research before trading.

590

EURUSD

Despite recent bullish sentiment, the pair hasn’t closed outside the declining channel or above the 1.065 pivot. While trading below this pivot and inside the channel, the outlook is bearish, with a potential decrease to a 1.041 support level.

591

NZDUSD

The NZDUSD currency pair, which represents the value of the New Zealand Dollar against the US dollar, is currently testing what we call ‘signal lines’ of a certain indicator. This is like a student taking a test to see how well they’re doing.

Now, the price of this currency pair is moving above something known as the ‘Ichimoku Cloud’. The Ichimoku Cloud is a tool that traders use to get an idea of where the market might be heading. When the price moves above this cloud, it usually suggests that we might see an upward trend. This means that the New Zealand Dollar could increase in value compared to the US dollar.

Traders are expecting that the price will test the upper boundary of this cloud, which is currently at 0.5995. If it passes this test, it could rise further to 0.6085. Think of this like a climber trying to reach a higher point on a mountain - if they succeed, they can aim for an even higher point.

Another sign that could confirm this upward trend would be if the price bounces back from the lower boundary of what’s known as a ‘bullish channel’. This channel is like a path that upward trends tend to follow.

However, there’s always a chance that things won’t go as expected. If the price breaks through the lower boundary of the Ichimoku Cloud and manages to stay under 0.5965, it would suggest that instead of rising, the New Zealand Dollar might decline in value against the US dollar to possibly around 0.5875. This would be like our climber slipping and falling down the mountain.

So, while current signs point towards an increase in the value of New Zealand Dollar against the US dollar, it’s always important to keep an eye on these key levels as they can indicate potential changes in trend.

592

GBPJPY

In the daily chart, GBPJPY broke out of the channel, tested the 182.9 pivot, and rebounded. Today’s session saw the bulls break the pivot, with the RSI indicator above 50, indicating a likely uptrend continuation.

Technical indicators suggest a bullish market direction, despite oscillators being in the sell zone. Moving averages signal a strong buy.

The 4H chart shows GBPJPY forming a new bullish trend, with RSI nearing overbought. We recommend waiting for a test of the 182.9 support before entering a long position.

If the price stays in the bullish channel, we target the 184.39 resistance.

593

GBPUSD

The GBPUSD currency pair, also known as “Cable”, is currently around 1.23. It has been trying to get past the 1.2328 level, but it’s been tough. This level is important because it’s a key point on the chart that traders look at. Despite some not-so-great news about the UK’s economy, the pound is still doing okay. The US dollar might get weaker because the US Federal Reserve (the Fed) is being careful with its money policies due to global economic issues and uncertainty. This could help the pound.

Later today, we’ll get some data about US inflation (how much prices are rising). If inflation is as expected or lower, it could make the US dollar weaker and help the pound.

On the chart, things are looking up for the pound. However, there are some signs that it might be tough for the pound to keep going up. If the pound can get past 1.2328, it could keep going up. If it can’t, it might start going down. Here are some key levels to watch:

Resistance: 1.2328 - 1.2386 - 1.2418 - 1.2443

Support: 1.2276 - 1.2240 - 1.2207 - 1.2187

594

AUDUSD

In the past few days, the Australian Dollar has been trying to increase its value. This attempt has seen some success, but not consistently across all major currencies. When we look at the daily chart for AUDUSD, we can see that it has started to rise slowly. This rise was hinted at by a positive RSI divergence. RSI divergence is a technical indicator that shows if the momentum of a price change is increasing or decreasing. In this case, it was positive, which means the momentum for a decrease in price was getting weaker. This suggested that the Australian Dollar might start to increase in value.

At this moment, the exchange rate of AUDUSD is just below the 50-day moving average. The 50-day moving average is a line on the chart that shows the average exchange rate over the past 50 days. It helps traders to see the overall trend of the exchange rate. In August, a technical pattern called a ‘Death Cross’ appeared between the 20-day and 50-day moving averages. This pattern is usually seen as a sign that the exchange rate might start to decrease.

So, even though the Australian Dollar has gained some value recently, the overall technical trend suggests that it might decrease again. Apart from the 50-day moving average, another important level to watch is the 0.6459 mark. This level acted as a turning point for the exchange rate in May.

If AUDUSD breaks above this level, it could go up to the next turning point at 0.6568, which was established in March. On the other hand, if AUDUSD starts to decrease, it could go down to the November low of 0.6272.

595

CPI: Not the most welcome outcome

Recent inflation reports have exceeded expectations, potentially offsetting the cautious tone from Federal Reserve officials. However, the focus seems to be on the duration of current interest rates rather than their height. Thus, a slightly higher inflation rate may not significantly disrupt the market.

The “Fed rhetoric shift” is becoming evident, with Christopher Waller’s comments suggesting that the rise in yields could substitute for a rate hike. This indicates a possible shift towards a more dovish monetary policy.

The future hinges on economic indicators. Unless inflation rises unexpectedly or labor market imbalances lead to a wage-price spiral, the Fed may maintain a less hawkish stance. This could boost demand for longer-duration assets and foster a “Santa rally”.

The market’s reaction to today’s CPI print is uncertain, but it may not be what investors were hoping for.

596

Crude Oil Market Analysis

Crude Oil rose from $80, which is in the Ichimoku cloud, and is currently testing the broken support around $84. Bears successfully broke out of the channel and the outlook of the current market is bearish, with the RSI hovering below the 50 line in the Crude Oil daily chart.

The bearish bias of Crude oil is more vivid in the 4H chart, as the black gold is trading below the pivot and within the bearish channel.

With the price holding below the 84.36 pivot, we expect the decline in Crude oil to continue and target the 80 support followed by 77.86.

On the flip side, if the oil price closes above the bearish channel in the 4H chart, the short-term bearish scenario will be over, and bulls are likely to drive up the price to test the daily resistance around $88 in upcoming sessions.

597

XAUUSD

Gold prices are looking to increase as we move into early European trading hours. With a rise of over 2.4 percent, the gold to US dollar rate (XAUUSD) is on track for its best week since mid-March. This comes as recent comments from the Federal Reserve have been increasingly cautious.

If we look at the daily chart, the first level of resistance seems to be at 1884.89, a key point from August. Resistance levels are prices at which sellers are expected to enter the market in sufficient numbers to take control from buyers.

Just above that, gold will encounter the 50- and 200-day moving averages. A moving average is a commonly used indicator in technical analysis that helps smooth out price action by filtering out the “noise” from random short-term price fluctuations.

There was a bearish crossover in September, which suggested a general downward trend. A bearish crossover occurs when a short-term moving average crosses below a long-term moving average, signaling potential downward price movement.

So, XAUUSD is facing important resistance levels as we approach the weekend. If prices start to fall, the midpoint of the Fibonacci retracement level is at 1848.37, followed by the 1804.78 – 1815.30 point. Fibonacci retracement levels are horizontal lines that indicate where support and resistance are likely to occur. They are based on Fibonacci numbers, each level is associated with a percentage, showing how much of a prior move the price has retraced.

598

In-Depth Analysis of XAGUSD

Silver prices, much like their golden counterpart, are experiencing a similar trend. The XAGUSD pair has seen an impressive surge this week, with an increase of nearly 2 percent. This level of aggressive push in the value of this precious metal hasn’t been witnessed since mid-September.

Looking ahead, the immediate resistance that the XAGUSD pair might face is twofold. Firstly, it’s the previous rising range of support that was observed in September. Secondly, it’s the 38.2% Fibonacci retracement level which stands at 22.85. These resistance levels could potentially hold their ground, thereby reinstating the broader bearish bias that has been prevalent since early May.

However, in the event of a downward turn, the immediate support seems to be situated at the midpoint of the Fibonacci retracement, which is at 21.84. If losses extend beyond this point, the focus then shifts to the 61.8% level at 20.83.

A clearance below this latter level could potentially open up the possibility for a resumption of the downtrend. This would be a significant development as it would indicate a continuation of the bearish bias in the market.

In conclusion, while silver prices have shown a promising increase this week, there are several key resistance and support levels to watch out for. These levels will play a crucial role in determining whether the current uptrend can sustain itself or if a return to the bearish bias is on the horizon.

599

Frax’s New Product sFRAX: A Game Changer in Decentralized Finance

Frax, a decentralized finance protocol, has introduced a new product called sFRAX. This product allows holders of Frax’s stablecoin, FRAX, to earn interest at a rate similar to the U.S. Federal Reserve’s interest rate on reserve balances, which is currently around 5.4%. The product started with an annual percentage yield (APY) of 10%, but it will eventually match the Federal Reserve’s rate.

Since its launch, over 150 users have invested more than $35 million in sFRAX. This has caused the price of Frax’s governance token, FXS, to increase by 7% to $5.66, although it has since dropped slightly to $5.49.

Meanwhile, lending protocol MakerDAO has been successful in attracting interest in the U.S., investing over $2 billion in short-term bonds since February 2022 and offering a 5% savings rate on its own stablecoin, DAI. This has led to a significant increase in the value of its token, MKR, which has risen by over 168% this year.

In comparison, FXS has only increased by 32% this year. However, some people in the crypto community believe that FXS will soon catch up with MKR.

600

USDJPY: Temporary Pause, but Uptrend Persists

The USDJPY rally has recently hit a pause as it lingers near the firm resistance at the psychological level of 150, not too distant from the 2022 peak of 152. Nonetheless, there is no clear indication of a reversal in the ongoing uptrend. The price action for this month, thus far, can best be described as moving sideways, with the lower boundary finding support around the 200-period moving average, near the early-October low of 147.35.

Considering that USDJPY is currently within the intervention zone observed last year, breaking through the 150.00-152.00 range could be a challenging endeavor. This challenge is further accentuated by the views of some Federal Reserve officials who have suggested that interest rates may have peaked. For a more comprehensive understanding of the fundamental outlook, refer to the article “Japanese Yen Aided by Fed Pause View, Geopolitics; USDJPY, GBPJPY, AUDJPY,” which was published on October 11. On the flip side, a drop below the 147.00-147.50 range would confirm a fading of the broader upward pressure. Such a decline could potentially pave the way towards the early-September low of 144.50.