Yesterday’s Market WrapYesterday markets were quite volatile, with decent moves in both directions, and several reveals in certain assets such as Gold
Yesterday’s Market Wrap
Yesterday markets were quite volatile, with decent moves in both directions, and several reveals in certain assets such as Gold. The data was light but traders are taking every bit very seriously, with three major central banks holding meetings this week.
The USD was coming from a bullish period during last week, which continued this week as well, with some positive economic figures, such as the improvement in manufacturing PMI survey on Monday and the jump in consumer confidence yesterday, together with better revisions for June. This shows that the US consumer is feeling better as inflation slows.
So, we saw a continuation of the upward momentum in the USD yesterday after the Conference Board consumer confidence numbers yesterday, but the situation reversed toward the end of the European session and the USD started to decline, while everything else was going up. Elsewhere in Europe, the German ifo Business Climate and the Belgian NBB Business Climate showed another deterioration, which kept the Euro soft.
Today’s Market Expectations
Today started with eh CPI (consumer price index) report from Australia, which was expected to show a decent slowdown in Q1, from 14% to 1.0%, while the annualized CPI number was expected to tick lower to 5.5% from 5.6% previously. This is bearish for the AUD, although the economic situation in China is also very important for the commodity Dollars.
In the US session we have the New Home Sales which are expected to move lower in June to 726K from 763K in May. Traders are looking at this data and it might offer some volatility, but I don’t think it will be a market changer ahead of the FOMC meeting, which is expected to produce a 25 basis points hike.
Many expect this to be the last interest rate hike, so the forward guidance will be very important to watch, if Powell will give any hints for another hike or make it clear that they will stop at this meeting. Both scenarios are expected to send the USD in major moves on either side, so volatility is expected during and after the meeting.
As we said, yesterday was quite volatile, despite light economic data in the calendar, and there were quite a few reversals too. So we opened 8 trading signals in total, including crude Oil, Gold and forex, five of which closed in profit while three hit SL. Besides that, the two long term signals we opened closed in profit which increased the pips for the winning side.
For more detailed updates, please refer to the section below.
MAs Turning Into Resistance for GOLD
Gold has been declining for about a week, since it turned bearish on Monday last week and retraces higher have been met by sellers at every point. Moving averages have turned into resistance at the top, initially the smaller moving averages, now the larger ones, such as the 200 SMA (purple) which has been capping attempts to reverse the price higher. Yesterday we opened two sell Gold signals against this moving average, both of which closed in profit as sellers tested the downside, but a support zone has formed around $1,953.
XAU/USD – 240 minute chart
Considering the current market conditions, we are providing a trading signal as follows:
- Gold Sell Signal
- Entry Price: $1,963.37
- Stop Loss: $1,977.37
- Take Profit: $1,955.37
The Pressure in WTI Has Turned to the Upside
Crude Oil has been bullish for about a month, since it reversed at the support zone and has been making some strong gains since then, climbing around $12. Late last week we saw a retreat to the 50 SMA (yellow) on the H4 chart, but the 50 SMA held the decline and we saw a bullish revrsal higher. Yesterday we opened two buy Oil signals, both of which closed in profit, as the price approached the $80 level.
Cryptocurrency Update
BITCOIN Stops at the 50 SMA
BTC/USD – Daily chart
We decided to open another buy Bitcoin signal on Monday, playing the range again, buying BTC/USD just above $30,000:
- Entry Price: $28,000 or $28,500
- Stop Loss: $26.500
- Take Profit: $31,300
The 100 SMA Holds as Support for ETHEREUM?
Ethereum made a strong bounce and moved above $2,000 earlier this month as buyers remained in charge. We have had quite a few long term buy Ethereum signals since the trend has been bearish since the beginning of 2023, with the lows getting lower. Although since then the pressure has been to the downside, but Ethereum has still shown more resilience than Bitcoin. So, we decided to open a buy ETH signal on Monday after the retreat, so we’re betting on moving averages to act as support and hold the retreat and the 100 SMA (green) seems to be holding.
ETH/USD – Daily chart
- Entry Price: $1,860
- Stop Loss: $1,740
- Take Profit: $2,020
www.fxleaders.com