InvestMacro

by JustForex

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.0500
• Prev Close: 1.0519
• % chg. over the last day: +0.18%

The Producer Price Index, which shows the inflation rate between factories and plants, jumped by 5.5% MoM in Europe. As a rule, the growth of this index is further accompanied by rising prices for consumer goods. Due to strong inflationary pressures, the ECB sees a possible interest rate hike as early as July. The unemployment rate in the Eurozone decreased from 6.9% to 6.8%.

Trading recommendations

• Support levels: 1.0453
• Resistance levels: 1.0584, 1.0633, 1.0723, 1.0766, 1.0799, 1.0869, 1.0955

From the technical point of view, the trend on the EUR/USD currency pair on the hourly time frame is bearish. The price reached the support level and is trading flat now. The MACD indicator has become inactive, but the divergence is increasing. Under such market conditions, traders can look for sell deals from the resistance level of 1.0633, but only after the additional confirmation. Buy trades can be considered on intraday timeframes from the support level of 1.0453, but only with short targets and confirmation.

Alternative scenario: if the price breaks out through the 1.0770 resistance level and fixes above, the uptrend will likely resume.

News feed for 2022.05.04:

• – German Services PMI (m/m) at 10:55 (GMT+3);
• – Eurozone Services PMI (m/m) at 11:00 (GMT+3);
• – Eurozone Retail Sales (m/m) at 12:00 (GMT+3);
• – US ADP Nonfarm Employment Change (m/m) at 15:15 (GMT+3);
• – US ISM Services PMI (m/m) at 17:00 (GMT+3);
• – US FOMC Statement at 21:00 (GMT+3);
• – US Fed Interest Rate Decision at 21:00 (GMT+3);
• – US FOMC Press Conference at 21:30 (GMT+3).

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.2490
• Prev Close: 1.2494
• % chg. over the last day: +0.03%

There is an almost 100% chance that the Bank of England will raise the key rate by 25 basis points (0.25%) to 1% on Thursday, the highest rate level in 13 years and the threshold at which active quantitative tightening can begin. It is important to look closely at changes in gross domestic product forecasts and the consumer price index. GDP is likely to fall sharply in 2022, and inflation is expected to be revised upward. If the forecasts are much worse, the pound could fall even more.

Trading recommendations

• Support levels: 1.2486, 1.2438
• Resistance levels: 1.2530, 1.2792, 1.2981, 1.3010, 1.3114

On the hourly time frame, the GBP/USD currency pair trend is still bearish. The price reached the support level and is trading flat now. The MACD indicator has become inactive. Under such market conditions, sell trades should be looked for from the resistance level of 1.2530 intraday or 1.2695, but with confirmation. For buy deals, traders may consider the level of 1.2486, but only with short targets.

Alternative scenario: if the price breaks down through the 1.2792 resistance level and fixes above, the mid-term uptrend will likely be resumed.

News feed for 2022.05.04:

• – US FOMC Statement at 21:00 (GMT+3);
• – US Fed Interest Rate Decision at 21:00 (GMT+3);
• – US FOMC Press Conference at 21:30 (GMT+3).

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev Open: 130.10
• Prev Close: 130.13
• % chg. over the last day: +0.02%

The Japanese market will be closed today and tomorrow. Therefore, currency pairs with the yen will be completely dependent on the movement of major currencies. The fundamental picture for the JPY remains the same. The Bank of Japan pursues an ultra-soft monetary policy, negatively affecting the national yen rate. Today, major currencies will depend on the dollar index as the Fed is expected to hold an important meeting and press conference, where Jerome Powell will speak about the future economic outlook. The dollar index could see a new impulse growth if the future outlook is unfavorable. If the outlook is favorable, the dollar index could decline as the negative scenario already in prices.

Trading recommendations

• Support levels: 129.10, 128.55, 127.29, 126.91, 126.00, 125.57
• Resistance levels: 130.80

The medium-term trend on the USD/JPY currency pair is bullish. The MACD indicator has become inactive, and the buyers’ pressure has decreased. Volatility has reduced, while the price is trading in a narrow flat. Under such market conditions, it is best to look for buy deals, expecting the continuation of the uptrend, but only after a pullback, as the price has strongly deviated from the average values. First of all, it is worth considering the support level of 129.10 or 128.55, but with additional confirmation. A resistance level of 130.80 may be considered for sell deals, but only with short targets.

Alternative scenario: If the price fixes below 127.29, the uptrend will likely be broken.

News feed for 2022.05.04:

• – US FOMC Statement at 21:00 (GMT+3);
• – US Fed Interest Rate Decision at 21:00 (GMT+3);
• – US FOMC Press Conference at 21:30 (GMT+3).

The USD/CAD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.2879
• Prev Close: 1.2839
• % chg. over the last day: -0.31%

The Canadian dollar is a commodity currency and depends not only on the monetary policy of the Bank of Canada but also on the dollar index and on the prices of energy commodities such as oil. The dollar index traded without a single dynamic yesterday. At the same time, oil prices decreased by 2% as demand worries over a prolonged quarantine in China due to COVID-19 outweighed the prospect of an EU embargo on Russian oil. As a result, the USD/CAD currency pair is trading without significant changes.

Trading recommendations

• Support levels: 1.2824, 1.2750, 1.2644, 1.2607, 1.2521
• Resistance levels: 1.2908

The USD/CAD currency pair is bullish in terms of technical analysis. The MACD indicator has become inactive, but the divergence has increased. Trade is worth it only with short targets because, fundamentally, both the dollar index and the Canadian dollar are inclined to grow. Under such market conditions, it is better to look for buy trades on the lower timeframes from the support level of 1.2750, but it is better with additional confirmation. For sell deals, it is better to consider the resistance level of 1.2908, but it is also better with confirmation and short targets.

Alternative scenario: if the price breaks through and consolidates below 1.2644, the downtrend will likely be resumed.

News feed for 2022.05.04:

• – US Crude Oil Reserves (w/w) at 17:30 (GMT+3);
• – US FOMC Statement at 21:00 (GMT+3);
• – US Fed Interest Rate Decision at 21:00 (GMT+3);
• – US FOMC Press Conference at 21:30 (GMT+3).

by JustForex

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By Orbex

EURUSD sees further downside

The euro continues to weaken over growth concerns in the eurozone amid the war in Ukraine. A tentative break below 1.0500 further put the euro under pressure.

A lack of rebound suggests that the bears are confident enough to hold onto their chips, while the bulls stay on the sidelines. A bullish RSI divergence shows a slowdown in the sell-off.

However, only a rally above 1.0650 could ease the selling pressure and help turn sentiment around. Otherwise, 1.0400 from January 2017 would be the next stop.

USDCHF hits 2-year high

The US dollar rallies ahead of an expected Fed rate hike this week. The pair is grinding a rising trendline and is about to reach a two-year high at 0.9800.

The RSI has ventured into the overbought area on the daily time frame. Meanwhile, the indicator’s bearish divergence suggests a loss of momentum in the parabolic ascent. The pair could be due for a pullback for the bulls to catch their breath.

The demand zone between the trendline and 0.9670 from the latest consolidation is a key area to gauge short-term buying interest.

US 30 struggles for support

The Dow Jones 30 recoups losses as traders take profit ahead of the FOMC. A break below 33300 forced bulls to bail out and suggests that the liquidation phase is yet to end.

The demand zone around 32700 from March’s rebound is a critical level to test buyers’ resolve. An oversold RSI has attracted bargain hunters, but the rebound will need to clear 33900 before a bullish reversal could materialize.

Failing that, February’s lows around 32300 would be the support of last resort before a deeper correction towards 31000.

Test your strategy on how the USD will fare with Orbex – Open Your Account Now.

Article by Orbex

Orbex is a fully licensed broker that was established in 2011. Founded with a mission to serve its traders responsibly and provides traders with access to the world’s largest and most liquid financial markets. www.orbex.com

by JustForex

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.0560
• Prev Close: 1.0507
• % chg. over the last day: -0.50%

In April, the US Manufacturing PMI index slowed to its lowest level since September 2020 due to further supply chain problems following recent restrictions in China. The US economy is slowly slipping into recession, and the Fed has not even begun to raise interest rates aggressively yet.

Trading recommendations

• Support levels: 1.0453
• Resistance levels: 1.0584, 1.0633, 1.0723, 1.0766, 1.0799, 1.0869, 1.0955

From the technical point of view, the trend on the EUR/USD currency pair on the hourly time frame is bearish. The price reached the support level and is trading flat now. The MACD indicator has become inactive, but the divergence is increasing. Under such market conditions, traders can look for sell deals from the resistance level of 1.0633, but only after the additional confirmation. Buy trades can be considered on intraday timeframes from the support level of 1.0453, but only with short targets and confirmation.

Alternative scenario: if the price breaks out through the 1.0770 resistance level and fixes above, the uptrend will likely resume.

News feed for 2022.05.03:

• – German Unemployment Rate (m/m) at 10:55 (GMT+3);
• – Eurozone Producer Price Index (m/m) at 12:00 (GMT+3);
• – Eurozone Unemployment Rate (m/m) at 12:00 (GMT+3);
• – US JOLTs Job Openings (m/m) at 17:00 (GMT+3).

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.2571
• Prev Close: 1.2491
• % chg. over the last day: -0.64%

The UK retail sales index showed a significant decline last week. Retailers also expect sales to decline in May. Economic surveys point to concerns about the outlook for consumer spending and the economy as a whole. This Thursday, the Bank of England will hold a meeting on monetary policy, which is likely to decide on a further increase in interest rates by 0.25%.

Trading recommendations

• Support levels: 1.2486, 1.2438
• Resistance levels: 1.2695, 1.2792, 1.2981, 1.3010, 1.3114

On the hourly time frame, the GBP/USD currency pair trend is still bearish. The price reached the support level and is trading flat now. The MACD indicator has become inactive. Under such market conditions, sell trades should be looked for from the resistance level of 1.2695 but confirmed. For buy deals, traders may consider the level of 1.2486, but only with short targets.

Alternative scenario: if the price breaks down through the 1.2792 resistance level and fixes above, the mid-term uptrend will likely be resumed.

News feed for 2022.05.03:

• – UK Manufacturing PMI (m/m) at 11:30 (GMT+3).

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev Open: 129.73
• Prev Close: 130.18
• % chg. over the last day: +0.34%

Japan has a long weekend until Friday. Thus, currency pairs with the yen will be fully dependent on the movement of major currencies. The fundamental picture for JPY remains the same. The Bank of Japan pursues an ultra-soft monetary policy that negatively affects the national yen rate.

Trading recommendations

• Support levels: 129.10, 128.55, 127.29, 126.91, 126.00, 125.57
• Resistance levels: 130.80

The medium-term trend on the USD/JPY currency pair is bullish. The MACD indicator has become inactive, and the buyers’ pressure has decreased. Volatility decreased on the eve of the holidays. Under such market conditions, it is best to look for buy deals, expecting the continuation of the uptrend, but only after a pullback, as the price has strongly deviated from the average values. First of all, it is worth considering the support level of 129.10 or 128.55, but with additional confirmation. A resistance level of 130.80 may be considered for sell deals, but only with short targets.

Alternative scenario: If the price fixes below 127.29, the uptrend will likely be broken.

There is no news feed for today. Bank holiday.

The USD/CAD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.2838
• Prev Close: 1.2877
• % chg. over the last day: +0.30%

The Canadian dollar is a commodity currency and depends not only on the monetary policy of the Bank of Canada but also on the dollar index and on the prices of energy commodities, such as oil. The fundamental picture for the Canadian dollar is very vague. On the one hand, the Bank of Canada will also raise interest rates, which is positive for the Canadian dollar. Rising oil prices are also positive for the Canadian dollar. On the other hand, tighter monetary policy from the Fed contributes to the growth of the dollar index. As a result, the USD/CAD currency pair has no clear trend and trades in wide volatile corridors.

Trading recommendations

• Support levels: 1.2824, 1.2750, 1.2644, 1.2607, 1.2521
• Resistance levels: 1.2908

The USD/CAD currency pair is bullish in terms of technical analysis. The MACD indicator has become inactive, but the divergence has increased. Trade is worth it only with short targets. Under such market conditions, it is better to look for buy trades on the lower timeframes from the support level of 1.2750, but it is better with additional confirmation. For sell deals, it is better to consider the resistance level of 1.2908, but it is also better with confirmation and short targets.

Alternative scenario: if the price breaks through and consolidates below 1.2644, the downtrend will likely be resumed.

There is no news feed for today.

by JustForex

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

by JustForex

Increased inflationary pressures caused by the war in Ukraine, as well as supply chain problems related to the pandemic and restrictions in China, have helped raise bond rates and strengthened expectations of Federal Reserve policy tightening. Investors continue to expect more and more central banks to tighten monetary policy in response to high inflation.

Some analysts believe that the US government may have misjudged the looming threat of inflation. The US Federal Reserve provided enormous amounts of cash during the pandemic to smooth out widespread economic damage. According to analysts, this stimulus led to an increase in household savings. A boom followed this in demand for durable goods. This surge in demand occurred when global supply chains came to a halt, followed by prolonged inflation. In March 2022, prices in all categories jumped to historic levels, with inflation reaching 8.5% year on year. However, today’s inflation is not spiraling as in the past. In the past, monetary tightening has reduced inflation and forced companies to shift labor costs offshore. As a result, American workers have seen their labor income stagnate relative to labor productivity for four decades. This period in US economic history was remembered for stagflation. Many analysts believe policymakers will fail to make a soft landing on the economy, and the US will soon face stagflation again (slowing economic growth with high inflation).

US stock indices mostly declined throughout the trading day yesterday, but at the close of the session, they showed a sharp impulse and closed the day in the positive zone. By the close of the trading session yesterday, the Dow Jones index (US30) gained 0.26%, the S&P 500 index (US500) added 0.57%, and the technology index NASDAQ (US100) jumped by 1.63%.

Major European indices closed in the red zone yesterday. German DAX (DE30) decreased by 1.13%, French CAC 40 (FR40) lost 1.66%, Spanish IBEX 35 (ES35) fell by 1.73%, British FTSE 100 (UK100) was not traded. The UK retail sales index showed a significant decline last week. Retailers also expect sales to decline in May. Economic surveys point to concerns about the outlook for consumer spending and the economy as a whole. The Bank of England will hold a monetary policy meeting as early as Thursday, where it is likely to decide on another 0.25% interest rate hike. Italian Prime Minister Draghi said the government had approved measures to stimulate the economy by another 14 billion euros. The European Commission is expected to complete the sixth package of European Union (EU) sanctions against Russia for its invasion of Ukraine today.

The European Commission considers the decision to cut off Poland and Bulgaria from gas a breach of contract. Currently, Bulgaria and Poland receive gas through Greece and Germany. The European Commission also considers Russia’s demand to pay for gas in rubles “an attempt to split the EU” and calls for solidarity and unity.

Oil prices increased on Tuesday as the European Union confirmed plans to tighten sanctions against Russia this week, and Germany said it was ready to support an immediate embargo on Russian oil. The European Commission may lift Hungary and Slovakia from an embargo on buying Russian oil, fearing that both countries are completely dependent on Russian oil.

Gold fell by 3% yesterday. At the moment, precious metals are under price pressure due to the monetary policy tightening. Tighter monetary policy is pushing up the national currency and government bond yields which are inversely correlated with gold and silver.

Asian stock markets traded flat yesterday. Japan’s Nikkei 225 (JP225) decreased by 0.11%, Hong Kong’s Hang Seng (HK50) jumped by 4.01%, and Australia’s S&P/ASX 200 (AU200) lost 1.18%. The Central Bank of Australia raised its interest rate by 25 basis points to 0.35% for the first time in a decade and said it plans to tighten it even further. A statement from the bank said it was a good time to start reducing the emergency monetary support program that was introduced to help the Australian economy during the pandemic. The economy has proven resilient, and inflation rose faster than expected. Therefore, along with rising wages, it is appropriate to begin the process of normalizing monetary conditions. The outlook for economic growth in Australia also remains positive. However, uncertainty about the global economy remains due to continued disruptions caused by COVID-19, especially in China, the war in Ukraine, and declining consumer purchasing power due to rising inflation. According to the central forecast, Australia’s GDP growth will be 4.25% in 2022 and 2% in 2023.

Main market quotes:

S&P 500 (F) (US500) 4,155.38 +23.45 (+0.57%)

Dow Jones (US30) 33,061.50 +84.29 (+0.26%)

DAX (DE40) 13,939.07 -158.81 (-1.13%)

FTSE 100 (UK100) 7,544.55 0.0 (0.0%)

USD Index 103.63 +0.67 (+0.65%)

• – Australia RBA Interest Rate Decision (m/m) at 07:30 (GMT+3);
• – Australia RBA Rate Statement (m/m) at 07:30 (GMT+3);
• – German Unemployment Rate (m/m) at 10:55 (GMT+3);
• – UK Manufacturing PMI (m/m) at 11:30 (GMT+3);
• – Eurozone Producer Price Index (m/m) at 12:00 (GMT+3);
• – Eurozone Unemployment Rate (m/m) at 12:00 (GMT+3);
• – US JOLTs Job Openings (m/m) at 17:00 (GMT+3).

by JustForex

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

by JustForex

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.0497
• Prev Close: 1.0541
• % chg. over the last day: +0.42%

A recent US consumer poll released by the University of Michigan on Friday showed that many Americans believe the Fed will have a hard time ensuring a soft landing of the economy due to the planned aggressive rate hikes. The Federal Reserve will almost certainly approve a rate increase of 50 basis points, or 0.5%, this week. Traders are also predicting a 75 basis point hike at the June meeting.

Trading recommendations

• Support levels: 1.0453
• Resistance levels: 1.0580, 1.0633, 1.0770, 1.0796, 1.0870, 1.0908, 1.0936

From the technical point of view, the trend on the EUR/USD currency pair on the hourly time frame is bearish. The price reached the support level and is trading flat now. The MACD indicator has become inactive. Under such market conditions, traders can look for sell deals from the resistance level of 1.0633, but only after the additional confirmation. Buy trades can be considered on intraday timeframes from the support level of 1.0453, but only with short targets and confirmation.

Alternative scenario: if the price breaks out through the 1.0770 resistance level and fixes above, the uptrend will likely resume.

News feed for 2022.05.02:

• – German Retail Sales (m/m) at 09:00 (GMT+3);
• – Spanish Manufacturing PMI (m/m) at 10:15 (GMT+3);
• – Italian Manufacturing PMI (m/m) at 10:45 (GMT+3);
• – French Manufacturing PMI (m/m) at 10:50 (GMT+3);
• – German Manufacturing PMI (m/m) at 10:55 (GMT+3);
• – Eurozone Manufacturing PMI (m/m) at 11:00 (GMT+3);
• – US ISM Manufacturing PMI (m/m) at 17:00 (GMT+3).

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.2552
• Prev Close: 1.2571
• % chg. over the last day: +0.15%

Bank of England Governor Andrew Bailey said the central bank was on a “very narrow margin” between curbing inflation, which is 7%, three times higher than the target, and preventing a recession. A quarter-point rate hike to 1% would satisfy the precondition for the Bank of England to start actively selling its bonds. Active bond selling will tighten monetary conditions but could hurt the economy.

Trading recommendations

• Support levels: 1.2502, 1.2438
• Resistance levels: 1.2670, 1.2791, 1.2862, 1.2917, 1.2981, 1.3010, 1.3083, 1.3115

On the hourly time frame, the GBP/USD currency pair trend is still bearish. The price reached the support level and is trading flat now. The MACD indicator has become inactive. Under such market conditions, sell trades should be looked for from the resistance level of 1.2670, but with confirmation. For buy deals, traders may consider the level of 1.2502, but only with short targets.

Alternative scenario: if the price breaks down through the 1.2863 resistance level and fixes above, the mid-term uptrend will likely be resumed.

There is no news feed for today.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev Open: 130.84
• Prev Close: 129.85
• % chg. over the last day: -0.76%

The fundamental picture of the USD/JPY currency pair remains unchanged. Central banks’ monetary policy in the US and Japan is the opposite. The central bank of Japan is still aiming for ultra-soft conditions, while the US Federal Reserve is aggressively tightening monetary policy. Bank of Japan Governor Haruhiko Kuroda still sees the yen’s weakness as a positive for Japan. However, policymakers fear the yen at a 20-year low will suffer from more expensive food and fuel. The survey found that half of the Japanese companies expect higher costs to affect their profits. There are no prerequisites for a medium-term trend reversal yet. But traders should keep in mind that markets are pricing in future scenarios, so any verbal information about monetary policy changes can lead to radical corrective action.

Trading recommendations

• Support levels: 129.10, 128.51, 127.24, 126.91, 125.48, 124.66, 122.97
• Resistance levels: 130.85

The medium-term trend on the USD/JPY currency pair is bullish. The MACD indicator has become inactive, and the buyers’ pressure has decreased. Under such market conditions, it is best to look for buy deals, expecting the continuation of the uptrend, but only after a pullback, as the price has strongly deviated from the average values. First of all, it is worth considering the support level of 129.10 or 128.51, but with additional confirmation. A resistance level of 130.85 may be considered for sell deals, but only with short targets.

Alternative scenario: If the price fixes below 126.91, the uptrend will likely be broken.

News feed for 2022.05.02:

• – Japan Manufacturing PMI (m/m) at 03:30 (GMT+3).

The USD/CAD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.2804
• Prev Close: 1.2858
• % chg. over the last day: +0.42%

Economic growth in Canada has reached its annual high. On Friday, Statistics Canada reported real gross domestic product increased by 1.1% last month, the largest monthly gain since March 2021. This is the ninth consecutive monthly gain. In early April, the central bank raised the key interest rate by 0.5% for the first time in more than 20 years and warned that more rate hikes are coming, but analysts believe the next hikes will be 0.25% each. But last week, Bank of England Governor Tiff Macklem told a House of Commons committee that the bank would consider taking another 50 basis point step.

Trading recommendations

• Support levels: 1.2751, 1.2684, 1.2644, 1.2607, 1.2521
• Resistance levels: 1.2852

In terms of technical analysis, the USD/CAD currency pair is bullish. The MACD indicator became positive, and the buyer’s pressure increased again. Trade is worth it only with short targets. Under such market conditions, it is better to look for buy trades on the lower timeframes from the support level of 1.2571, but it is better with additional confirmation. For sell deals, it is better to consider the resistance level of 1.2852, but it is also better with confirmation and short targets.

Alternative scenario: if the price breaks through and consolidates below 1.2644, the downtrend will likely be resumed.

News feed for 2022.05.02:

• – Canada Manufacturing PMI (m/m) at 16:30 (GMT+3).

by JustForex

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

by JustForex

Last week ended with reports from major tech companies, which should largely determine the future of US indices. Facebook, Qualcomm, Microsoft, and Apple showed positive reports. Google and Amazon showed negative reports. As a result, markets closed last week with a loss. Economic prospects are still overshadowed by concerns about the economic impact of the war in Ukraine, rising bond yields, new coronavirus restrictions in China, which could hinder hamper improving global supply chains, and more aggressive monetary policy tightening by the Federal Reserve. At the close of the stock market on Friday, the Dow Jones Index (US30) decreased by 2.77% (-2.24% for the week, -5.57% for the month), and the S&P 500 Index (US500) lost 3.63% (-2.90% for the week, -9.84% for the month). The technology index NASDAQ (US100) fell by 4.17% on Friday (-3.25% for the week, -15.12% for the month).

April marked the biggest monthly drop in the S&P 500 since the coronavirus pandemic began, while the high-tech Nasdaq recorded the biggest monthly drop since the 2008 financial crisis. The Federal Reserve will almost certainly raise interest rates by 50 basis points (0.5%) this week on Wednesday, the first increase of this magnitude in more than 20 years. And such a move is unlikely to be a peak for the Fed. Analysts forecast a 75 basis point (0.75%) hike at the June meeting.

Statistically, markets tend to trade positive before the upcoming Fed meeting, so investors expect the stock market to rise before the FOMC meeting.

Major European indices traded higher on Friday. Optimistic earnings reports helped the market close the week on the plus side, but April closed the month on the downside. Germany’s DAX (DE30) gained 0.84% on Friday (+1.36% for the week, -2.89% for the month), France’s CAC 40 (FR40) added 0.39%(+1.28% for the week, -2.94% for the month), Spanish IBEX 35 (ES35) increased by 0.85% (+0.62% for the week and +0.74% for the month), British FTSE 100 (UK100) jumped by 0.47% (+0.30% for the week and -0.19% for the month). Preliminary data indicated that the Eurozone economy showed a decline in economic activity for the first time in 3 months. Statistical office showed that Eurozone GDP grew by 0.2% in the last quarter, while economists were expecting a growth of 0.3-0.4%.

Russia has paid coupons on Eurobonds maturing in 2022 and 2042 in dollars a week before the end of the grace period, as required by the contracts, so the default is canceled.

The Times’ British sources in Ukrainian intelligence claim that the Russian Federation has developed clear plans to invade Moldova.

The EU intends to propose that countries impose a total ban on Russian oil by the end of this year and disconnect a number of Russian banks, including Sberbank, from SWIFT. According to preliminary information, EU countries are likely to approve a phased embargo on Russian oil this week.

Gold fell nearly 2% in April, despite rising 1% on Friday. The drop in gold came after the US dollar recorded the largest monthly gain in 10 years. The dollar index increased by 4.6% in April, the highest value since January 2015. Precious metals are inversely correlated with the dollar index and US government bond yields. Buying gold to protect against inflation is only speculative in nature.

Asian markets traded flat last week. Japan’s Nikkei 225 (JP225) decreased by 1.29% over the week (-3.20% for the month), Hong Kong’s Hang Seng (HK50) gained 3.97% (-6.28% for the month), and Australia’s S&P/ASX 200 (AU200) fell by 2.08% (-1.05% for the month). China is scheduled to hold a symposium with the country’s major technology companies, which gives hope that Beijing will end extensive regulation of the technology sector. The symposium was scheduled after this year’s Labor Day holiday, which runs from Saturday through Wednesday, to reassure business executives that regulators will no longer subject them to strict regulation or impose unexpected fines. That could give a boost to China’s technology companies.

At the commodities market, futures on natural gas (+35.93%), orange juice (+23.53%), corn (+11.97%), palladium (+9.53%), gasoline (+7.97%), cotton (+7.22%) and wheat (+4.02%) showed the biggest gains at the month-end. The biggest drop was demonstrated by lumber futures (-13.19%), silver (-7.89%), copper (-7.29%), platinum (-4.21%) and Brent oil (-3.76%).

Main market quotes:

S&P 500 (F) (US500) 4,131.93 -155.57 (-3.63%)

Dow Jones (US30) 32,977.21 -939.18 (-2.77%)

DAX (DE40) 14,097.88 +118.04 (+0.84%)

FTSE 100 (UK100) 7,544.55 +35.36 (+0.47%)

USD Index 103.21 -0.41 (-0.40%)

• – Japan Manufacturing PMI (m/m) at 03:30 (GMT+3);
• – German Retail Sales (m/m) at 09:00 (GMT+3);
• – Spanish Manufacturing PMI (m/m) at 10:15 (GMT+3);
• – Switzerland Manufacturing PMI (m/m) at 10:30 (GMT+3);
• – Italian Manufacturing PMI (m/m) at 10:45 (GMT+3);
• – French Manufacturing PMI (m/m) at 10:50 (GMT+3);
• – German Manufacturing PMI (m/m) at 10:55 (GMT+3);
• – Eurozone Manufacturing PMI (m/m) at 11:00 (GMT+3);
• – Canada Manufacturing PMI (m/m) at 16:30 (GMT+3);
• – US ISM Manufacturing PMI (m/m) at 17:00 (GMT+3).

by JustForex

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By Orbex

The internal structure of the NZDUSD pair hints at a cycle zigzag pattern that consists of sub-waves a-b-c. On the chart, we see the end of a large correction wave b of the cycle degree. It took the form of a primary triple zigzag Ⓦ-Ⓧ-Ⓨ-Ⓧ-Ⓩ.

After the cycle correction was complete, the market turned around, and we saw the development of a cycle wave c. This has the form of an ending diagonal consisting of primary sub-waves ①-②-③-④-⑤.

Most likely, the formation of a new bearish trend is starting. This could take the form of a primary impulse ①-②-③-④-⑤. In the near future, the price will fall in the primary wave ③ to 0.628. At that level, it will be at 161.8% of wave ①. Then the development of the primary fourth correction is likely.

In the second scenario, the formation of a cycle zigzag has not yet ended. The final primary wave Ⓩ, which is part of correction b, took the form of a triple zigzag (W)-(X)-(Y)-(X)-(Z) of the intermediate degree.

According to this view, the first four parts of the intermediate pattern ended. Now the market is in the intermediate wave (Z). Wave (Z) is similar to the minor double zigzag W-X-Y.

Thus, in the upcoming trading weeks, we can expect a price increase and the development of a bullish cycle wave c near 0.721, and possibly even higher. In fact, this is likely to take the form of an impulse.

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Article by Orbex

Orbex is a fully licensed broker that was established in 2011. Founded with a mission to serve its traders responsibly and provides traders with access to the world’s largest and most liquid financial markets. www.orbex.com

By Orbex

USDJPY breaks higher

The yen nosedived after the Bank of Japan vowed to keep its interest rates ultra-low.

The dollar’s surge above the top range (129.30) of the recent consolidation forced early sellers to cover and switch sides. This breakout confirms the MA cross as an indication of a bullish acceleration.

Strong momentum suggests a combination of short-covering and fresh buying. The uptrend may resume towards 132.00 even though an overbought RSI could cause a temporary fallback. 128.30 at the base of the rally is the first support.

NZDUSD dips into bearish zone

The New Zealand dollar continues southward amid a lack of demand for risk-sensitive currencies.

Sentiment turned bearish after price action failed to hold above this year’s low at 0.6530, invalidating a two-month-long recovery. The pair is heading to a 22-month low at 0.6390.

An oversold RSI may prompt short-term sellers to cover, driving up the price. However, 0.6590 is a fresh resistance, and there is a high chance of a dead cat bounce as trend followers could be waiting to sell into strength.

US 30 nears critical floor

Dow Jones 30 steadies as a US GDP contraction may temper the Fed’s hawkish stance. The index has given up most gains from the March rally.

The demand zone between 32700 and 33000 is an important guardrail to keep the price afloat in the medium term. A bearish breakout could extend losses beyond 32300, leading up to a potential bear market.

A bullish RSI divergence is an encouraging sign as the sell-off could be slowing down. Nonetheless, buyers will need to push past 34150 to ease the selling pressure first.

Article by Orbex

Orbex is a fully licensed broker that was established in 2011. Founded with a mission to serve its traders responsibly and provides traders with access to the world’s largest and most liquid financial markets. www.orbex.com

Article By RoboForex.com

EURUSD, “Euro vs US Dollar”

As we can see in the H4 chart, the asset has formed a Harami reversal pattern close to the support area. At the moment, EURUSD is reversing in the form of a new correctional impulse. In this case, the upside correctional target may be at 1.0575. However, an alternative scenario implies that the price may fall to reach 1.0420 and continue the descending tendency without any corrections towards the resistance level.

USDJPY, “US Dollar vs Japanese Yen”

As we can see in the H4 chart, USDJPY has formed a Hanging Man pattern not far from the resistance level. At the moment, the asset is reversing in the form of a new descending impulse. In this case, the downside correctional target may be at 129.90. At the same time, an opposite scenario implies that the price may grow to reach 132.50 and continue the uptrend without any pullbacks.

EURGBP, “Euro vs Great Britain Pound”

As we can see in the H4 chart, after forming a Shooting Star reversal pattern near the resistance area, EURGBP is reversing and correcting. In this case, the downside correctional target may be at 0.8395. Later, the market may test the support level, rebound from it, and resume the ascending impulse. Still, there might be an alternative scenario, according to which the asset may grow to reach 0.8475 and continue the uptrend without testing the support level.

Article By RoboForex.com

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.