GBPUSD: The Pivot Prevailed
The GBPUSD currency pair experienced a decline after reaching the 1.264 pivot point. The downward trend is expected to persist, with targets set at 1.255 and 1.248.
Crucial GBPUSD Levels to Watch: 1.255 Support and 1.274 Resistance
The GBPUSD currency pair experienced a strong bounce from the 1.255 area, with an upbeat halt at the 1.264 pivot, which consequently serves as the main resistance area for the bulls.
However, upon closer examination of the 1-hour chart, we can observe three bearish engulfing candle patterns signaling the pressure of bears near the pivot. The bearish scenario appears stronger, given that the overall outlook of the GBPUSD is bearish.
It is important to note that, as long as the 1.264 pivot holds, the market’s primary objective is to retest the 1.255 support level, followed by a potential further decline to the 1.248 level. This information is crucial for traders and investors who are closely monitoring the market’s movements and seeking to make informed decisions.
On the other hand, if the bulls manage to close above the 1.265 pivot on GBPUSD, it would pave the way for a potential rise to the 1.274 resistance level.
The US Dollar is trying to recover from recent losses. US Treasury yields fell, which put downward pressure on the Dollar. Economic data from the US was disappointing, which made investors think the Federal Reserve might not raise interest rates soon. This put more downward pressure on the Dollar. Investors are waiting for more data from the US to see what the Federal Reserve will do. There is no significant data from the UK this week, so investors are focusing on the US economy. The upcoming datasets include the US ADP Employment Change for August and the preliminary Gross Domestic Product Annualized for the second quarter (Q2). These will be released later in the North American trading session and could provide more insight into the economic outlook of the United States.
Bitcoin Analysis: ETF Approved as Traders Celebrating
Bitcoin is trading around $27,300 after it broke the minor resistant at 26.734 after a US court has approved the first Bitcoin ETF, marking a major win for crypto investors. The SEC’s decision to deny Grayscale Investments’ Bitcoin ETF was overruled by the DC Court of Appeals. This allows investors to gain exposure to Bitcoin without owning it, causing a surge in crypto token prices
Yesterday, Bitcoin experienced a rise of about 5%, reaching the resistance level of $28,099, and currently the bears added pressure to correct the recent gains. Market analysts predict that Bitcoin will trade within a range of $25K to $28K in the upcoming sessions, unless the bulls manage to close above the $28,099 barrier. If this happens, the surge in Bitcoin’s value is expected to continue, with the first target being the psychological level of $30K.
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Missed Data and Falling Dollar in Gold Analysis: How Gold Prices are Rising
Gold prices have been rising this week due to two key factors. Firstly, there was a miss in the US JOLTS job openings data, which measures the number of job openings in the US economy. Secondly, there was a miss in the US consumer confidence data, which measures how confident consumers are feeling about the economy. These two misses indicate that the US job market is slowing down, which is in line with the Federal Reserve’s objectives. The Federal Reserve wants to cool down the US economy by raising interest rates. As a result of these misses, gold prices surged higher on Tuesday as yields and the dollar fell.
On Thursday, there will be another important data release that could impact gold prices: the PCE print. The PCE print measures inflation in the US economy and is closely watched by the Federal Reserve. If the PCE print comes in below market expectations, it could cause yields and the dollar to fall again, which would lift gold prices. The Core PCE print is expected to come in at 4.2%, slightly higher than the previous reading of 4.1% for June. The headline print is expected to come in at 3.3%, up from the previous reading of 3%. It’s important to remember that the PCE inflation data is the Fed’s preferred measure of inflation, so they will be paying close attention to this data release.
Gold is currently testing the broken trend line, which is also near the 1,951 pivot. The bulls must break the pivot to push the price to higher levels such as 1,979 - 1,986. On the flip side, monitoring the price action and candlestick pattern in the pivot zone may provide decent opportunities to go short on XAUUSD.
The bearish candlestick patterns you want to look for are Shooting Star, Bearish Engulfing, Evening Star, and Dark Cloud Cover. These patterns can indicate a potential reversal in the market and provide traders with an opportunity to enter a short position on Gold. By carefully analyzing the price action and candlestick patterns in the pivot zone, traders can make informed decisions about their trades and potentially profit from market movements.
Crude Oil Analysis: Strong Rise on the Price
Today’s PCE (Personal Consumption Expenditures) data was as expected, and this helped stock prices to rise as August came to an end. Even though interest rates won’t be lowered, the fact that they won’t be raised again this year has made people want to buy more stocks. Lower bond yields have also made stocks more attractive, and they are ending the month in a better position than they were a week ago.
However, there is a potential problem. Investors are feeling more positive about the global economy, which means they think demand for oil will increase. The price of oil has gone up over the past week, and this could lead to higher inflation later in the year. If prices go up and interest rates start to rise again, this could be bad news for the stock market.
The crude oil is currently testing the $84 barrier. The Weekly chart shows the Crude Oil is trading in a range area between the $84 resistant and the $66 support. This level has been tested four times this year and the bears could decline the price every time. The bulls must close above the $84 barrier to pave the road to $92 which is likely to be seen in the coming weeks based on the current fundamental.
On the other hand, the $77 price point serves as a minor support level for crude oil. In order to maintain a bullish outlook, it is crucial that this level holds. If the price forms a bearish engulfing or a shooting star candlestick pattern near the demand zone ($84), we can expect a decline. As such, it is highly recommended to closely monitor these levels and analyze technical data to make informed decisions.
EURUSD Analysis: Price is Steady as Traders Awaits Important Data
At present, the EURUSD rate is holding steady, as the market eagerly awaits an important announcement about US job figures. However, this calm was disrupted on Thursday when the European currency experienced a dip, effectively reversing some of its gains from earlier in the week. This downturn was anticipated, given the significant news expected to be released on Friday.
In addition to this, the European currency was dealt another blow due to disappointing retail sales figures from Germany. These figures serve as a stark reminder of the ongoing concerns surrounding the trajectory of the European economy.
Despite these challenges, the European Central Bank continues to maintain a firm stance. This is largely due to persistently high consumer prices. The tough rhetoric from the bank in response to these inflationary pressures is playing a crucial role in bolstering the value of the European currency.
Given these circumstances, it seems prudent at this point to adopt a ‘wait and see’ approach. With an important announcement on the horizon, it’s advisable to hold off on making any major decisions until more information becomes available.
The EURUSD currency pair is currently undergoing a critical test of the 1.083 pivot point. A close examination of the 4-hour chart reveals no significant candlestick patterns, indicating a lack of clear direction for the pair.
Adding to this uncertainty, the Relative Strength Index (RSI) indicator has flipped below its signal line, suggesting a bearish outlook for the EURUSD. However, for this bearish scenario to fully materialize, it is crucial for the bears to close below the pivot line. If this occurs, their next target would be the 1.073 support level, with the decline likely to continue within the bearish channel.
On the other hand, the bulls face a strong resistance at 1.0946 and the upper band of the declining channel. In order to invalidate the bearish scenario and shift momentum in their favor, they must first escape from the channel and close above the 1.0946 resistance level.
Traders and investors would do well to closely monitor developments and be prepared to act accordingly.
WTI Oil Prices Soar: Russia and Saudi Arabia Cut Production
WTI oil prices are rising due to falling crude oil inventories and production cuts by Russia and Saudi Arabia. However, concerns about an economic slowdown in China may limit further gains. Oil traders are watching upcoming reports, including the Chinese Caixin Services PMI and the US ISM Services PMI.
WTI is the US benchmark for crude oil prices. On Monday, it was trading around $85.2, close to its YTD high of $85.52. WTI prices are also supported by a significant drop in US crude oil stocks.
Russia agreed with OPEC+ to limit oil output, with details to be announced later this week. Russia is expected to cut its oil exports, while Saudi Arabia is expected to continue its voluntary oil cut. These developments helped WTI prices reach a YTD high on Friday.
However, concerns about an economic slowdown in China may limit further gains for WTI. Moody’s recently revised its 2024 GDP forecast for China downward. Oil traders are watching upcoming reports, including the EIA Crude Oil Stocks Change data.
WTI Crude Oil recently broke through the $84 resistance level and is currently trading near $85.8. The RSI indicator is hovering near the overbought zone, suggesting a correction may be due. The $84 support area offers a reasonable entry point for buyers.
Overall, the outlook for WTI Crude Oil remains positive, but traders should remain cautious and keep an eye on key indicators and market developments.
GBPUSD Recovery Uncertain as UK Factory Activities Decline
The GBPUSD is trying to recover from 1.2600, but its recovery is uncertain as UK factory activities keep declining. Despite this, the Bank of England (BoE) is expected to raise interest rates for the 15th time in a row this month. This has put pressure on UK firms, who have shifted their focus to stabilizing margins and reducing costs by cutting inventories and their workforce.
The GBPUSD pair is trying to make a significant comeback after a severe sell-off, which was caused by growing recession concerns. However, the recovery effort seems fragile as UK factory activities are being affected by the BoE’s higher interest rates.
In today’s trading session, the GBPUSD currency pair is making a concerted effort to correct the losses it incurred on Friday. Currently, the GBPUSD is trading near a key resistance level and the pivot zone at 1.263. Given the prevailing market conditions, the outlook for this currency pair is a downtrend. Consequently, for the bears to maintain this bearish scenario, it’s crucial that they keep the pair below the 1.263 pivot point.
On the other hand, if the bulls manage to close above the 1.265 resistance level, it could potentially invalidate the current bearish scenario. In such a situation, we could see the GBPUSD surge towards the 1.27 resistance level, and possibly even extend towards 1.28.
EURUSD Analysis: Exploring the Possibility of a Bullish Reversal
In July, the number of orders for German-made goods decreased significantly, suggesting that Germany’s manufacturing industry is facing challenges. The decrease was 11.7%, which was more than expected. In the same month, Germany’s Industrial Orders also decreased by 10.5% compared to the previous year, while in June it had increased by 3.3%. This data indicates that the German manufacturing sector may require support to recover.
The EURUSD currency pair is currently trading in a declining channel and recently visited the 1.071 support level. At the same time, the RSI indicator was hovering in the oversold area. Interestingly, a bullish engulfing pattern has emerged in the EURUSD 4-hour time frame. As a result, we have two signals for entering a form of correction in the EURUSD or even a trend reversal. However, the reversal is unlikely since it requires optimistic fundamental news for the Euro zone.
On a technical standpoint, support is at 1.071 and due to the bullish engulfing candlestick pattern and the RSI indicator exiting the oversold area, there is a high possibility for the pair to test the recent broken support which acts as resistance around 1.076 followed by the 1.083 pivot.
Fed Rate Hike Speculation Rattles Markets
The strong ISM data has led to speculation that the Federal Reserve (Fed) might raise interest rates again before the year ends and keep them high for a while. The US 2-year return is now over 5%, and the 10-year return is around 4.30%, meaning the returns you get from investing in US government bonds are going up. The 2-year return is now above 5%, and the 10-year return is about 4.30%. When these returns rise, it can affect the economy.
The US dollar is getting stronger, and it’s moving towards the 105 level. When it reaches 105.40, traders will decide if it’s going to change from being weak this year to being strong in the medium term. But this is affecting countries around the world. Japan, in particular, is worried and says they might do something to prevent their currency, the yen, from losing value.
In the stock market, the S&P 500 didn’t do well because of the rising US returns. It went below 4500 points and a 50-day average that shows market trends. The Nasdaq 100 also dropped because Apple’s stock fell more than 3.50%. This happened because of a report that Chinese government workers can’t bring iPhones and other foreign-made devices to work. People see this as a sign of the ongoing trade and technology disputes between the US and China."
EURUSD Analysis: Markets Surprised by Q2 GDP Fails
The Eurozone’s Q2 2023 GDP was revised, surprising markets that had expected 0.6% growth. Instead, the GDP saw a small increase of 0.1%, falling short of the projected 0.3%. This was due to slow domestic consumption and decreasing exports. Despite this, the EURUSD is gaining, even though expectations for a rate hike from the ECB next week are dropping.
The EURUSD currency pair is currently trading within a declining channel and is closing below the 1.072 resistance level. This suggests that the decline is likely to continue, with the next target being the 1.065 supply zone.
GBPUSD Analysis: A Dance with the 1.2500 Mark
The GBPUSD pair is experiencing a slight increase during the Asian session on Friday, moving away from its three-month low. Despite this, it remains below the 1.2500 mark and traders should exercise caution before betting on a bullish scenario. With US Treasury bond yields declining and stock markets stable, traders are hesitant to bet on USD bulls. This is providing some support to the GBPUSD pair, though the USD remains strong due to expectations of high interest rates from the Fed.
Traders anticipate another 0.25% rate increase by the end of the year, supported by strong US economic data such as the Weekly Jobless Claims on Thursday. This should boost US bond yields and the USD, while expectations that the Bank of England (BoE) is nearing the end of its rate hikes could weigh on the British Pound and limit gains for the GBPUSD pair.
BoE Governor Andrew Bailey stated on Wednesday that the central bank is close to ending its rate increases, though further hikes may still be necessary due to high inflation. In the absence of significant economic news from either the UK or the US, it may be prudent for traders to wait for further buying momentum before confirming a near-term bottom for the GBPUSD pair.
The Calm Before the Storm: Anticipating the ECB Meeting
The European single currency is currently stable, maintaining a level above 1.07. This stability is due to the low volatility in the market today, as investors are hesitant to make significant moves before the European Central Bank’s (ECB) meeting on Thursday.
On Friday, the currency’s performance was as expected. Despite a temporary dip below 1.07, it managed to avoid major losses and showed signs of steadiness. There were no additional losses in the international stock markets, which means there’s no current trigger that could lead to further losses for the European currency.
This week is crucial as we anticipate one of the most contentious ECB meetings in recent months on Thursday. Opinions are divided on whether ECB President Lagarde will announce a 25 basis point increase in key interest rates.
Today’s agenda is quite light, and tomorrow’s doesn’t hold much of significance either. The focus now shifts to Wednesday, when the U.S. Consumer Inflation rate will be announced, and of course to Thursday’s ECB meeting.
In anticipation of these significant events, it’s likely that we’ll see a repeat of Friday’s market behavior, with limited fluctuations. The exchange rate is expected to hover around the 1.07 level without much deviation.
Decoding GBPJPY’s Price Dynamics Amid Weak JPY Fundamentals
The GBPJPY currency pair has been exhibiting a rectangular trading pattern since the onset of the week. At present, the pair continues to test the previous week’s low at 182.86. Despite this, the market remains bullish above the 182.86 support level, providing a glimmer of hope for bullish investors to drive up the pair’s price. This optimism is further bolstered by the current weak fundamentals of the Japanese Yen.
However, it is crucial to exercise caution before initiating a long trade on GBPJPY, as indicated by the Relative Strength Index (RSI) which is currently positioned below the signal line. The level of 183.7 serves as a minor resistance point that bullish investors must overcome to aim for R1 at 185.59.
Conversely, should there be a firm close below the S1 support at 182.86, it could potentially signal a continuation of the downtrend. Therefore, it is essential for investors to closely monitor these key levels and market indicators to make informed trading decisions.
Dollar Gets Stronger Amid Changes in World Economy
The US dollar is doing better after it fell due to comments from Japan and China. Also, Beijing has made rules that need approval for buying more than $50 million. These different money policies around the world keep helping the dollar. It’s doing better against all the G10 currencies and is mostly the same as yesterday. Most currencies from developing countries are lower, with those from Central Europe falling the most. The Chinese yuan is steady.
Most stock markets are down, but those in Japan, Taiwan, and Australia went up today. Europe’s Stoxx 600 is a bit lower and US index futures have dropped by about 0.25%.
Japan’s 10-year yield has gone up a bit to 0.70%. European yields are a bit lower by up to two points. Even with a rise in average weekly earnings in the UK, the 10-year Gilt yield has dropped almost five points to 4.42%. The US 10-year yield has dropped about 1.5 points to almost 4.27%. Today, the US plans to sell $35 billion of the 10-year note.
Gold is trading between $1918.6 and $1924.5 today, with its 200-day average around $1920. October WTI is steady near yesterday’s high of $88.15 before today’s OPEC and EIA monthly market reports. The IEA’s report will be out tomorrow.
The WTI Crude Oil Odyssey: From $85 and Beyond
The possibility of more growth in US oil production is quite limited. The number of oil drilling machines has dropped by 140 this year, which is a 20% decrease since the start of the year.
The amount of gasoline stored in the US is at the lowest it’s been in the past five years. It’s also about 5% less than the average amount stored over the past five years, which means people are still using a lot of gasoline.
Goldman Sachs says that Saudi Arabia needs the price of oil to be around $85 per barrel to balance its budget. It’s important to remember that Saudi Aramco is planning to sell more shares in December. So, we can expect pressure to keep oil prices high until then. But for the UAE, it’s closer to $50 per barrel. For a long time, Russia needed the price of oil to be between $40 and $50 per barrel to balance its budget. But now, because of the ongoing war, it needs the price to be as high as $115 per barrel. Last year, when prices were this high, we saw a big drop in demand.
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The EIA predicts that demand for oil will reach its highest point before 2030.
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There’s a big increase in speculative interest in the oil market. Net positioning is already above the average of the past two years.
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The next big hurdle for WTI oil is around $90 per barrel.
Examining the WTI Crude Oil daily chart, the uptrend persists post a minor correction and $85 test. The RSI indicator is in the overbought zone. HubuFX analysts advise retail traders with small balances to wait for a correction to around $84 for better long trade entry points.
Navigating the Gold Market: An In-depth Look at Recent Trends
The price of gold is continuing to drop, moving closer to the $1,900 mark. This is happening because the value of the US Dollar is starting to rise again. This increase is due to a careful approach in the market and a rise in US Treasury bond yields. Everyone is now waiting for the US Consumer Price Index (CPI) inflation data. This information will guide the US Federal Reserve’s decisions about interest rates.
On Wednesday, the market is being cautious because of a drop in Apple and Oracle shares. People are thinking about what the European Central Bank and Bank of Japan might do next. They’re also considering how the increase in oil prices could affect the world’s economy and central banks. Oil prices are near their highest in ten months because OPEC+ has cut oil production.
The US Dollar is in demand because it’s seen as a safe option when the market is uncertain. This is causing the price of gold to fall. US Treasury bond yields are going up again because people think that high US CPI data could lead to another increase in interest rates in November or December. There’s a 93% chance that the Fed will not change interest rates in September. So, the price of gold could drop below $1,900.
The US CPI is expected to have increased by 3.6% in August, compared to 3.2% in July. The annual Core CPI inflation is likely to be 4.3%, down from 4.7% in July. On a monthly basis, the US CPI is expected to have increased by 0.6% in August, while the core figure is likely to remain at 0.2%.
On Tuesday, the price of gold fell. This happened because people expect the European Central Bank (ECB) to change its policy after seeing its inflation forecasts. This expectation made gold, which doesn’t earn interest, less attractive. The Euro became more popular because of the ECB report, which made the Euro to US Dollar exchange rate go up. This decrease in the value of the US Dollar helped stop the price of gold from falling too much, keeping it around $1,907.
As we approach the release of US inflation data, the price of gold seems more likely to decrease. This is because it broke out of its previous range on Tuesday. Previously, the price of gold was fluctuating between the 21-day and 50-day moving averages (DMA), which were at $1,917 and $1,932 respectively. However, it ended the day below the 21-day DMA, indicating a potential downward trend.
The 14-day Relative Strength Index (RSI), which measures the speed and change of price movements, is currently below the midpoint and heading downward. This suggests that the price could continue to fall. The next important level for the price of gold is $1,900. If it falls below this level, we could see a rapid drop towards $1,885.
On the other hand, if the price starts to rise, it will first encounter resistance at the 21-day DMA of $1,917. If it can break through this level, it will then face the 200-day DMA at $1,921. If it can surpass this level, it could potentially rise to the 50-day DMA at $1,932.
USDJPY Analysis: Bulls Thrilling Climb to New Heights
The Japanese yen has slowed down a bit against the U.S. dollar after the head of the Bank of Japan made a statement that seemed to favor tighter monetary policy. But, there’s some news coming up that could shake things up. People are guessing that the U.S. Consumer Price Index (CPI), which measures inflation, might be higher than before. If that’s true, the U.S. Federal Reserve might raise interest rates again next week. This idea is making the U.S. dollar stronger. Also, in Japan, the rate of inflation at the wholesale level went down in August, which is making the yen weaker.
The USDJPY currency pair is on an upward trend, trading within a rising channel. The Relative Strength Index (RSI) has tipped over the signal line, indicating a potential increase in buying pressure. The lower line of this channel is acting as a support for bullish traders.
Interestingly, Japan’s yearly inflation rate at the wholesale level has been on a downward trend for the past eight months, weakening the Japanese yen. This economic backdrop sets the stage for the USDJPY to potentially reach its recent high at 147.88. If this level is surpassed, the next target could be 148.42.
The outlook for the USDJPY pair remains bullish. The support level at 146.57 could provide a favorable entry point for traders considering the risk-reward ratio at the current price.
In forex trading, it’s crucial to keep an eye on these economic indicators and market trends. They can provide valuable insights into potential trading opportunities and strategies. Always remember, successful trading involves careful analysis and risk management.
EURUSD Bearish Outlook and the Impact of Euro Economy News
The EURUSD currency pair has recently tested the 50-day Simple Moving Average (SMA) and the 1.078 resistance zone, but is currently trading below this level. As long as this level remains steady, the outlook for the currency pair will be bearish, with a potential target of 1.065.
However, if the bulls manage to close above the 1.078 resistance, it could halt the current downtrend momentum. In this scenario, the upper band of the bearish channel would become the next resistance to watch.
It’s worth noting that recent news about the Euro economy could impact this analysis. For instance, the European Central Bank is considering raising its key interest rate, and there are concerns about climate risks impacting Europe’s economy. These factors could influence the EURUSD currency pair’s movements in the near future. Stay updated with the latest news for more accurate forex predictions.