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Corporate Actions 12/08/2022

Ending the trading week -30

As the week comes to an end, let’s recap what happened in the markets, specifically the pairs that we follow.

Economic Calendar

While the beginning of the week was filled with market news and announcements, there is one important event to end the week and that is the Core PCE Price Index, due at 8.30 am EST Friday. Historically, that should only cause moderate to low volatility to the market. However, inflation and interest rates are some of the hottest trending topic in the markets lately and  if there is a huge surprise in numbers, we can expect a shift in investors’ sentiment. 

FOMC Recap

The Fed raised the interest rate by the forecasted 75 bps to 2.25%-2.5% range. 

Let’s review what Fed Chair Powell said.

Powell rejected the notion that the U.S. economy is in, or soon to be in a recession as firms continue their hiring in excess of 350,000 additional workers each month (We can  look at the past NFP numbers).  This may help calm the recessionary fears that have swept the markets recently. However, he acknowledged that the economy might need to slow down a little more for them to contain inflation. 

We can infer from the reactions on gold and USD pairs that the market received a more dovish signal from the Fed via the FOMC meeting,  which caused the expectation for the next rate hike in September to lower down a notch, from 75bps hike to a half point hike. 

Precious Metals

Gold

xauusd-h4-chart

XAUUSD H4 Chart. Source: Tradingview

The Fed raised rates by the expected amount. While the greenback should get stronger against gold, the reality is the other way around  given that there were no surprise from the Fed and market expectations have been priced in. Therefore, we observed a recovery of $46 on gold since the announcement. Besides, the Fed is seen to be more dovish than what the market expected previously, which caused USD to lose strength against other assets and currencies. 

It is currently faced with 1770 resistance which corresponds to a 200 period moving average as it is trying to break through the trendline. Traders will need to pay attention to see if gold can break above this level. There will be short opportunities if price fails to break out. In an alternative scenario, 1785 might be an interesting area to look for shorts if this is going to be a fakeout.

The Fed raised rates by the expected amount. 

Technical LevelsPrice Zone
R21785
R11770
S11710
S21680

Forex

EURUSD

eurusd-h1-chart

EURUSD H1 Chart. Source: Tradingview

The greenback got relatively weaker after the interest rate decision. EURUSD jumped from the lower boundary of the consolidation following the news and is now approaching the upper boundary of the range. The pair has also created a bullish market structure along the way with higher highs and higher lows, forming a bullish channel. 

A breakout to the upside is possible, but again we have to take USD’s strength into consideration with the Fed expected to raise rates  in the following meetings. 

Technical LevelsPrice Zone
R21.0360
R11.0265
S11.0115
S21.0000

Energies

WTI Crude

usoil-h4-chart

USOIL H4 Chart. Source: Tradingview

Following the FOMC meeting and Powell’s statement, the sentiments are starting to shift from being plagued by recessionary fears to an undersupply in the oil markets. 

A key event to keep an eye out for is the OPEC+ meeting that will take place on 3rd of August, 2022. U.S. President Joe Biden also visited Saudi Arabia to have talks on oil production 2 weeks ago on July 15th, which could have increased the chance of an increase in oil output. 

From a technical standpoint,  oil price steadies and made higher lows. It is now sitting above the broken trendline and is testing $98.50 resistance. A breakout to the upside and back to triple digits is likely based on the factors we discussed.

Technical LevelsPrice Zone
R2104.00
R198.50
S194.00
S290.00

US Stocks Market

SP500

sp500-h4

SP500 H4 Chart. Source: Tradingview

The US stock market in general reacted favourably to the interest rates announcement. We are seeing some slow and steady recovery for SP500 after a prolonged period of down trend. Marked on the chart with an arrow is when the news was released and we observed a jump in prices. 

In terms of technical analysis, SP500 broke out from its bearish channel and did a textbook retest on a broken resistance-turned-support at 3950. Now, it is heading towards 4150 resistance and we shall see if it is able to break through. If it does, 4300 will be our next target. Also, the 50 MA crossed over the 200 MA, which served as a bullish confluence for SP500.

Technical LevelsPrice Zone
R24300
R14150
S13950
S23750

Cryptocurrencies

Bitcoin

btcusd-h4-chart

BTCUSD H4 Chart. Source: Tradingview

The largest cryptocurrency also benefited from the FOMC news where it jumped by more than 13% following the event. Currently testing its previous swing high of $24320, it is poised for a breakout and continue to test a higher resistance at $25418.

Is the hope coming back for the Bitcoin hodlers?

Technical LevelsPrice Zone
R225418
R124320
S120750
S219000

Welf

Technical Analyst

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Week Ahead Analysis 11 July 2022

Economic Calendar

DayEvents
MondayBOE governor Bailey speaks 
Tuesday
WednesdayBOE governor Bailey speaks
NZD and CAD interest ratesBOC monetary policy report and press conferenceUS CPI 830 am EST 
ThursdayUS PPI
FridayUS Retail sales

Forex 

EURUSD


EURUSD H4 Chart

The pair has been making consistent lower highs as marked by the descending trendline. The immediate support is marked in blue near the recent swing low. Considering the build up in bearish momentum, there is a high chance parity will be tested by the end of the week, but still CPI data is going to play a major role in determining the sentiment of USD.

Technical LevelsPrice Zone
R21.02790
R11.01935
S11.0072
S21.0000 parity

USDCAD

USDCAD Daily Chart

The BOC is expected to raise their rates by 50 bps on wednesday. Technically the CAD is going to gain in strength with a rising interest rate but the question is whether this has been priced in to the markets already. 

Not only that, but the Fed is also expected to continue their rate hike throughout the year so we are looking at who is raising their rates higher and faster and also market’s expectations towards the currency.

Looking at the chart, it is in a bullish channel with consecutive higher highs and higher lows. The strength of the most recent up moves have also been relatively stronger than their pullbacks/ retracements. Let’s see if the interest rate decision on wednesday can turn the table around. For now, 1.3075 remains the key resistance and should it break, we may be looking at 1.3340 in the short term which is less than 300 pips away.

Technical LevelsPrice Zone
R21.3340
R11.3075
S11.2833
S21.2712

Precious metals

Gold

Gold M30 Chart

Gold spiked to a high of 1751 following better than expected NFP numbers which came out at 372k versus the expected 260k. It then quickly calmed down and is currently trading below the 50 period moving average. Looks like gold is preparing for a breakout frmo the consolidation zone to the downside. 

Next immediate support can be found at 1723 area, but since strong impulsive moves are usual following a breakout from a tight range, the level could be broken easily and gold may proceed to test 1680 area which has been a major support over the past 2 years.

Technical LevelsPrice Zone
R21752
R11748
S11723
S21686

Energies

Crude oil

Crude Oil H4 Chart

The major attention is on china covid’s situation right now as they discovered a new variant which led to a  minor jump in cases. The impact of this new discovery is magnified with China’s covid zero policy and investors are worried about a new wave of mass testing which could dampen fuel demand. Not only that but recessionary concerns still remains with a lot of central banks tighten their monetary policy which could lead to a gloabl economic slowdown and fuel demand could suffer. 

Oil opened at 104.8 during Asia and has been trading lower since> it is currently sitting on a minor support level which I don’t think it will hold for long after price rejected the resistance level at 104.50. If the support breaks we are looking at it testing the major swing low at $96 again.

Technical LevelsPrice Zone
R2106.2
R1102.9
S199.4
S294

US Stocks market

SP500

US500 Daily Chart

The US Stocks market has had a decent week last week, bagging minor gains of 2.06%. At least it is still in the green.

From a technical point of view, it is starting to close in a tigher range. Upside is still limited by the bearish trendline accompanied by the 50 day SMA. All eyes are on the CPI numbers later this week and we are just sitting on our hands. 

Technical LevelsPrice Zone
R24040
R13945
S13810
S23638

Welf

Trader, Technical Analyst

________________________________________________________________________________________

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Corporate Actions 04/07/2022

Trading Schedule – July 2022

Market Analysis 27/06/2022

Economic Calendar

DayEvents
MondayG7 Meeting
TuesdayG7 Meeting
WednesdayECB’s Lagarde, BOE’s Bailey and Fed’s Powell speaks
ThursdayCore PCE Price Index
FridayISM Manufacturing PMI, Canadian Bank Holiday

Headlines

Russia defaulted on its foreign-currency sovereign debt of about $100 Million. G7 to ban Russian gold.
Fed’s Bullard said a rapid rise in interest rates now is the best way to avoid recession later.

Forex

EURUSD

eurusd-daily-chart


EURUSD Daily Chart

EURUSD is getting a good start for the week as it rose 0.24% before the European session begins. However, 50 DMA and 1.0650 will be the first line of resistance for the bulls. If USD strength resumes, we may see the pair move down to test 1.0350 again. Also, it is the final few days before the second quarter ends so we expect more volatility in the coming days.

Precious Metal

Gold

xauusd-h4-chart

XAUUSD H4 Chart

Gold climbed 10 dollars to start the week of trading.
Fierce resistance is keeping gold prices in check. The 50 and 200-period moving averages and a bearish trendline are applying bearish pressure on gold. 

If it breaks, we shall see gold testing $1860. However, there is a higher tendency for gold to move downwards as it has been creating lower highs, with $1788 as the short-term target.

Energies

US Crude

usoil-daily-chart

USOIL Daily Chart

US Crude recovered to close the previous week at -2.25% while investors remain alert to the potential sanctions and talks on Russian Oil and Gas bans during the G7 meeting. Currently, there is a tug of war between the concern of a potential recession and the pressing supply issues, which are partly relieved by the accelerated output of OPEC+ and a potential revival of the Iran Nuclear Deal.

The midpoint of the range, $105 still provides some support to Oil prices. The probability of the price resuming its bullish trajectory is higher and hence our short-term target at $115.

US Stocks 

SP500

sp500-daily-chart

SP500 Daily Chart

Big gains last week for the US stocks market with SP500 closed +6.31%. However, it remains in a bearish channel and a 4100 key resistance to break should it wants to recover to where it was at the beginning of the year. Fed Chair Powell, due to speak on Wednesday may cause some market movements this week. The boundaries of the channel will be the immediate support and resistance, and key levels at 3750 and 4100. 

Cryptocurrencies

BTCUSD

btcusd-weekly-chart

BTCUSD Weekly Chart

Bitcoin was taking a breather from the sharp decline 2 weeks ago. It managed to make a 2.3% gain while holding its ground above the 20k mark.

$20,000 will be the key support while resistance is at the $28,000 area.

Welf

Trader, Technical Analyst

________________________________________________________________________________________

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Want to trade more than 300+ instruments with raw spreads starting from 0 pip and commissions as low as $2 per lot per side?

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FXPIG June 2022 Schedule

Market Analysis 30/5/2022

Economic Calendar

Important Events This Week

Monday- USD Bank Holiday

Wednesday- CAD interest rates

Thursday- GBP, EUR Bank Holiday, ADP Non-Farm Employment Change

Friday- GBP Bank Holiday, NFP

Covid in China

China recorded less than 100 new cases yesterday. Lockdowns may soon be lifted, manufacturing and consumption will be ramped up and global supply chains may not be as tight as it is right now. China’s oil demand will resume and it is good news for oil producers,

Forex

EURUSD

eurusd-daily-chart


EURUSD Daily Chart 

Not much has happened since last Friday. Markets are still slow while we are waiting for the Europe session to begin. Also, note that it is a US Bank holiday so the price may not move much. 50 Daily Moving Average is still keeping the bulls in check, with 1.0800 as its backup. We usually do not trade during bank holidays because volumes are thin, it is better to take a break and sit on the sideline.

Metals

XAUUSD

xauusd-daily-chart

XAUUSD Daily Chart

Gold is still lingering between the broken trendline and the 200 DMA after ending the previous week with mild gains of 0.36%. As the USD is undergoing a correction phase, gold may continue rising with the 50 DMA acting as a powerful resistance, coinciding with the 1900 key level.

Energies

Crude Oil

usoil-h4-chart

USOIL H4 Chart

Crude rallied and set for a positive start for the week. 

Factors contributing to the rise include but not limited to:
EU is holding a meeting Monday and Tuesday to discuss a ban on Russian import

  • China’s covid related restrictions will be lifted sooner or later as their new daily cases dropped to double-digit
  • USD is undergoing a correction, which means it is cheaper for oil importers holding other currencies

In terms of technicals, the price is testing the $115 upper barrier and the likelihood of it breaking is very high. If it breaks, crude may test the previous decade-high at $129.

US Stocks

SP500

sp500-daily-chart

SP500 Daily Chart

Investors breathe a sigh of relief as the stocks market finally closed the week in green after 7 consecutive losing weeks. It broke and closed above 4100 resistance which is a good sign that it may extend the rebound. However, the 50 DMA will be met shortly, coinciding with 4300 level. Inflationary concerns remain although the previous print was showing improvements. The Fed is expected to continue the rate hike all throughout this year which may weigh on the current bullish momentum.


Cryptocurrencies

Bitcoin

btcusd-daily-chart

BTCUSD Daily Chart

Bitcoin closed the previous week in loss, adding to its 8-week losing streak (Suprise, this is the longest losing streak that Bitcoin has ever been in). Nothing much happened over the weekend and Bitcoin is still consolidating between $28000 and $32000. Looking at the overall technical picture, we make a brave prediction that the bearish momentum may continue and Bitcoin is going down to test $19500 (its first all-time high made back in 2017).

Welf

Trader, Technical Analyst

________________________________________________________________________________________________________________

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Market Analysis – 27/5/2022

Economic calendar

Wednesday – New Zealand official cash rate/ FOMC meeting minutes

Forex

EURUSD

eurusd-daily-chart

EURUSD Daily Chart

The Euro strengthened against the greenback over the past 10 days and is just dancing on the 1.0600 level as we speak. 1.0650 will act as the immediate resistance standing in the way of the bulls while the 50 Moving average will be the next layer of resistance to the upside.

Gold

XAUUSD

xauusd-daily-chart

XAUUSD Daily Chart

Gold climbed steadily last week after bouncing from 1785 support and is currently testing the 1855 trendline and resistance level. The rise could be due to the USD having a slight pullback in strength as we witnessed on the EURUSD also. If it breaks above the trendline again, we could see the bullish momentum resumes, although it is not as lucrative to hold gold considering the rising interest rates.

Energies

USOIL

usoil-daily-chart

USOIL Daily Chart

Crude oil was trading consistently in the upper half of its trading range with the 50 daily moving average acting as support. The driving season is also about to begin in the US, which is the peak season for oil demand. Shanghai is also due to reopen its city on June 1st. The outlook for crude oil remains bullish as demand is resuming sooner or later while supply is still tight. 115 will be the first resistance to break through and we will see from there.

Stocks

SP500

sp500-daily-chart

SP500 Daily Chart

From a technical standpoint, SP500 has been making lower highs and lower lows, Considering the rate of decline has been increasing ( the slope of the downfall has become steeper ), the next possible target could be 3750.

Cryptocurrencies

BTCUSD

btcusd-daily-chart

BTCUSD Daily Chart

Bitcoin has been stuck in a tight range at around 30000 key areas for quite some time now. We are still waiting for the next market catalyst and there is no directional bias for now.

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