The pair is pushing off the signal lines of the indicator, going below the Ichimoku Cloud, which suggests the prevalence of an uptrend. A test of the upper border of the Cloud is expected at 1.0285, followed by growth to 1.0715. An additional signal confirming the growth will be a bounce off the lower border of the bullish channel. The scenario can be cancelled by a breakaway of the lower border of the Cloud and securing under 1.0015, which will entail further falling to 0.9925. The growth can be confirmed by a breakaway of the upper border of the descending channel and securing above 1.0425.
AUDUSD
The pair is testing the resistance level, going above the Ichimoku Cloud, which means an uptrend. A test of the upper border of the Cloud is expected at 0.6655, followed by growth to 0.6955. An additional signal confirming the growth will be a bounce off the lower border of the bullish channel. The scenario can be cancelled by a breakaway of the lower border of the Cloud and securing under 0.6445, which will entail further falling to 0.6345. The growth can be secured by a breakaway of the upper border of the correctional channel and securing above 0.6745.
GBPUSD
The pair has secured above the upper border of the bullish channel, going above the Ichimoku Cloud, which suggests the prevalence of an uptrend. A test of the Tenkan-Sen line at 1.1825 is expected, followed by growth to 1.2305. An additional signal confirming the growth of the pair will be a bounce off the lower border of the ascending channel. The scenario can be cancelled by a breakaway of the lower border of the Cloud and securing under 1.1455, which will mean further falling to 1.1365.
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.
Nobody, it seems loves the dollar which has weakened against every single G10 currency this month.
It was already suffering from markets scaling back bets for further aggressive Fed rate increases, but the most recent soft US inflation report dealt the knockout blow. With signs of cooling inflation significantly reducing the pressure for the Fed to keep raising rates aggressively, the dollar could be yanked from its throne sooner than expected.
Before we discuss the technical and fundamental forces that may influence the not so mighty dollar, here are the scheduled economic data releases/events in the coming week:
Monday, 21 November
CNH: China loan prime rates
EUR: Germany producer prices
USD: US Chicago Fed national activity index
Tuesday, 22 November
CNH: China Bloomberg economic survey
EUR: Euro area consumer confidence
USD: US Richmond Fed manufacturing index, Cleveland Fed President Loretta and St. Louis Fed President James Bullard speech
Wednesday, 23 November
NZD: Reserve Bank of New Zealand rate decision
EUR: S&P Global PMIs Euro area
USD: FOMC minutes of November meeting, University of Michigan sentiment
Thursday, 24 November
EUR: Germany IFO business climate, ECB minutes of October meeting
NGN: Nigeria GDP
US markets closed for the Thanksgiving holiday
Friday, 25 November
EUR: Germany GDP
NZD: New Zealand consumer confidence index
US markets close early
On paper, the week ahead looks relatively quiet with US stock and bond markets closed on Thursday for Thanksgiving. But looks can be deceiving with economic reports, central bank meetings in Israel and New Zealand among others in addition to speeches from financial heavyweights potentially injecting some more life into markets.
In regards to the USD, attention will be directed towards the US Chicago Fed national activity index and US Fed manufacturing index earlier in the week. However, the main risk event and potential shaker will be the FOMC minutes for the November meeting which could provide clues on the pace of US rate hikes. Although the central bank raised interest by 75 basis points during the meeting, it signalled that the next hike could be smaller. Any fresh information regarding this could reinforce expectations around the Fed dialling back on aggressive rates, especially after the soft US inflation figures. Such an outcome is likely to weaken the dollar further, dragging the equally weighted dollar index below 1.1900.
Looking beyond the FOMC minutes, EU energy ministers are scheduled to hold an emergency meeting in Brussels on Thursday which could influence market sentiment, possibly having a knock-on effect on the USD. On Friday, US markets close early as Black Friday marks the start of the festive shopping season.
Talking technicals, the equally weighted dollar Index remains under intense pressure on the daily charts. With the dollar stripped of its glory and fundamental forces supporting bears, the path of least resistance for the Index points south. A strong breakdown below 1.1900 could open a path towards 1.1700 and 1.1600, respectively. A move back above 1.2184 could signal an incline towards 1.2400.
The Eurozone’s annual inflation rate decreased from 10.7% to 10.6%. Core Inflation (excluding food and fuel prices) remained at 5% y/y. The data points to a possible peak in inflation. This increases the likelihood that the ECB will raise interest rates by 0.5% at its next meeting rather than by 0.75%, as previously discussed. ECB spokesman Lane said yesterday that the ECB expects inflation to fall next year but also noted the importance of further interest rate hikes.
Trading recommendations
Support levels: 1.0193, 1.0092, 1.0043, 0.9812
Resistance levels: 1.0384, 1.0504
From the technical point of view, the trend on the EUR/USD currency pair on the hourly time frame is bullish. The price is trading at the level of moving averages, the MACD indicator has become inactive, and the price is trading in a narrow price range. For buy deals, it is best to wait for a corrective movement to the support levels of 1.0193 or 1.0092, but with additional confirmation. Sell deals can be considered from the resistance level of 1.0384 inside the day, but it is also better with confirmation in the initiative on the lower time frames.
Alternative scenario: if the price breaks down through the support level of 0.9993 and fixes below it, the downtrend will likely resume.
News feed for 2022.11.18:
– Eurozone ECB President Lagarde Speaks at 10:30 (GMT+2);
– US Existing Home Sales (m/m) at 17:00 (GMT+2).
The GBP/USD currency pair
Technical indicators of the currency pair:
Prev Open: 1.1913
Prev Close: 1.1863
% chg. over the last day: -0.42 %
On Thursday, the UK government unveiled a £55 billion ($66 billion) budget plan aimed at closing the hole in public finances and restoring confidence in the British economy. These measures will increase financial hardship for millions of Britons, who are facing the country’s worst cost-of-living crisis in decades and its longest recession. Jeremy Hunt pointed out that these measures are necessary to curb inflation, which has reached a 41-year high and restore Britain’s reputation.
Trading recommendations
Support levels: 1.1684, 1.1476, 1.1418, 1.1172, 1.1093, 1.0915, 1.0817
Resistance levels: 1.1921
From the technical point of view, the GBP/USD currency pair trend on the hourly time frame is bullish. The price is trading at the level of the moving averages. The MACD indicator has become inactive, and the divergence indicates weakness and a possible correction. Under such market conditions, it is better to look for buy deals after a slight correction to the support levels of 1.1684 or even 1.1476. Sell trades are best sought on intraday time frames from the resistance level of 1.1921.
Alternative scenario: if the price breaks down of the 1.1418 support level and fixes below it, the downtrend will likely resume.
News feed for 2022.11.18:
– UK Retail Sales (m/m) at 09:00 (GMT+2).
The USD/JPY currency pair
Technical indicators of the currency pair:
Prev Open: 139.46
Prev Close: 140.21
% chg. over the last day: +0.53 %
Japan’s nationwide core consumer price index rose to a 40-year high from 3% to 3.6%, with an expectation of 3.5%. But despite the fact that the inflation rate has already exceeded the BoJ’s inflation target of 2% for the seventh time, the BoJ governor was quick to release a statement that an interest rate hike is undesirable at the moment. Thus, due to the divergent monetary policies of the Japanese banks and the US Federal Reserve, USD/JPY quotes are still inclined to rise.
From the technical point of view, the medium-term trend on the currency pair USD/JPY is bearish. The price is trading at the level of the moving averages. The MACD indicator has become inactive again, indicating the uncertainty of the market participants. The price is flying in a narrow corridor, which makes it difficult to find good entry points. Under such market conditions, buy trades can be searched for on intraday time frames from the support level of 139.44, but only with confirmation. Sell deals can be searched from the resistance level of 141.05, provided there is a reversal or a false breakout.
Alternative scenario: If the price fixes above 146.06, the uptrend will likely resume.
News feed for 2022.11.18:
– Japan National Consumer Price Index (m/m) at 01:30 (GMT+2).
The USD/CAD currency pair
Technical indicators of the currency pair:
Prev Open: 1.3324
Prev Close: 1.3326
% chg. over the last day: +0.02 %
Higher interest rates have driven up the cost of credit in Canada, with mortgage rates up 11.4% for the year, the largest increase since February 1991. This, combined with higher rents, helped raise housing rates. The Bank of Canada raised its prime rate by 350 basis points from March to 3.75%, one of the fastest tightening cycles on record. Money markets are betting mainly on a 25 bps hike at the Bank of Canada’s next meeting on Dec. 7.
From the point of view of technical analysis, the trend on the USD/CAD currency pair is bearish. But inside the day, there is a slight dominance of buying. The MACD indicator has become inactive again, and the price is trading at the level of moving averages. The best way to sell is to consider the resistance level of 1.3508, but with confirmation. Buy trades should be considered on the lower time frames from the support level of 1.3281, but with additional confirmation in the form of a reverse initiative.
Alternative scenario: if the price breaks out and consolidates above the resistance level of 1.3508, the uptrend will likely resume.
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.
At the resistance level, the instrument has formed a Shooting Star reversal pattern. Currently, the pair is following the signal, forming another correctional wave. The goal of the pullback might be 1742.50. After a test of the support level, the price may bounce off it and continue the uptrend. However, the price may grow to 1785.50, skipping the reversal signal altogether.
NZDUSD, “New Zealand Dollar vs US Dollar”
On H4, at the resistance level, the pair has formed a Shooting Star reversal pattern. Currently, the pair may go by the signal in a correctional wave. The goal of the pullback might be 0.6075. After a bounce off the support level, the quotes will get a chance for continuing the uptrend. However, the price may grow to 0.6220 without testing the support.
GBPUSD, “Great Britain Pound vs US Dollar”
On H4, at the resistance level, the pair has formed a Hanging Man reversal pattern. Currently, the pair may go by the signal in a descending wave. The goal of the correction might be the support level of 1.1820. In case the price bounces off it, the price will have a chance for continuing the uptrend. However, the price may grow to 1.2045 without correcting to the support.
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.
On H4, the quotes are under the 200-day Moving Average, which indicates the prevalence of a downtrend. The RSI are nearing the resistance line. Currently, we should expect a test of 1/8 (0.9399), a breakaway of it, and falling to the support level of 0/8 (0.9277). The scenario can be cancelled by rising over the resistance level of 2/8 (0.9521). In this case, the pair may rise to 3/8 (0.9643).
On M15, an additional signal confirming the decline will be a breakaway of the lower line of VoltyChannel.
XAUUSD, “Gold vs US Dollar”
On H4, the quotes are in the overbought area. The RSI has broken through the support line. Currently, we expect a test of 0/8 (1750.00), a breakaway of it, and falling to the support level of 7/8 (1718.75). The scenario can be cancelled by rising over the resistance of +1/8 (1781.25). This event might lead to further growth of the quotes to +2/8 (1812.50).
On M15, the lower line of VoltyChannel is broken, which increases the chances for further falling of the price.
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.
Inflation data will be released in Europe today. Experts believe that Europe’s Core Consumer prices (not including food and fuel) will hit another record. If inflation does rise, it will increase the likelihood that the ECB will consider another 75 basis point hike at its next meeting. Conversely, if inflation data shows a slowdown or stays the same, it could lead to a sell-off in the euro as the ECB becomes less aggressive while the US Federal Reserve keeps its foot on the gas.
Trading recommendations
Support levels: 1.0194, 1.0092, 1.0043, 0.9993, 0.9838, 0.9794, 0.9755
Resistance levels: 1.0411, 1.0504
From the technical point of view, the trend on the EUR/USD currency pair on the hourly time frame is bullish. The price is trading at the level of the moving averages, and the MACD indicator has become inactive. There is an accumulation in the form of liquidity narrowing. This means there will be an impulse move on today’s news. For buy deals, it is best to wait for a corrective movement to the support levels of 1.0194 or 1.0092, but with additional confirmation. Sell deals can be considered from the resistance level 1.0411 or 1.0504, but also better confirmation in the form of a false breakout.
Alternative scenario: if the price breaks down through the support level of 0.9993 and fixes below it, the downtrend will likely resume.
News feed for 2022.11.17:
– Eurozone Consumer Price Index (m/m) at 12:00 (GMT+2);
– US FOMC Member Bullard Speaks at 15:00 (GMT+2);
– US Building Permits (m/m) at 15:30 (GMT+2);
– US Initial Jobless Claims (w/w) at 15:30 (GMT+2);
– US Philadelphia Fed Manufacturing Index (m/m) at 15:30 (GMT+2);
– US FOMC Member Bowman Speaks at 16:15 (GMT+2);
– US FOMC Member Mester Speaks at 16:40 (GMT+2).
The GBP/USD currency pair
Technical indicators of the currency pair:
Prev Open: 1.1856
Prev Close: 1.1914
% chg. over the last day: +0.49 %
The UK Consumer Price Index (CPI) reached a 41-year high in October. Inflation in the country rose to an annualized rate of 11.1%. Energy bills, along with a sharp rise in food prices, led the index to a stronger-than-forecast increase. Markets have now focused on today’s financial report from Chancellor of the Exchequer Jeremy Hunt. Experts believe the budget will include spending cuts and tax hikes. On the other hand, this is positive for the British pound, as Britain’s recession will force the Bank of England to raise interest rates even more. Statistically, if rates are rising, the national currency is getting stronger.
Trading recommendations
Support levels: 1.1684, 1.1476, 1.1418, 1.1231, 1.1172, 1.1093, 1.0915, 1.0817
Resistance levels: 1.1901
From the technical point of view, the trend on the GBP/USD currency pair on the hourly time frame is bullish. The price is trading at the level of the moving averages. The MACD indicator has become inactive, and the divergence indicates weakness and a possible correction. Under such market conditions, it is better to look for buy deals after a slight correction to the support levels of 1.1684 or 1.1476. Sell deals are best to look from the resistance level of 1.1901, but it is better with confirmation in the form of a bearish initiative. Currently, there is none.
Alternative scenario: if the price breaks down of the 1.1418 support level and fixes below it, the downtrend will likely resume.
There is no news feed for today.
The USD/JPY currency pair
Technical indicators of the currency pair:
Prev Open: 139.28
Prev Close: 139.52
% chg. over the last day: +0.17 %
Bank of Japan Governor Kuroda said yesterday that the central bank would firmly support the economy by continuing easing. Achieving stable inflation will come from wage growth rather than monetary policy normalization. Thus, the situation on the currency pair USD/JPY in the medium term points to the growth of quotes.
From the technical point of view, the medium-term trend on the currency pair USD/JPY is bearish. The price is trading at the level of the moving averages. The MACD indicator has become inactive, indicating the uncertainty of market participants. The price is trading in a narrow corridor, which makes it difficult to find good entry points. Under such market conditions, buy trades can be searched for on intraday time frames from the support level of 137.65, but only with confirmation because this level has already been tested. Sell deals can be searched from the resistance level of 141.05, but only with additional confirmation.
Alternative scenario: If the price fixes above 146.06, the uptrend will likely resume.
There is no news feed for today.
The USD/CAD currency pair
Technical indicators of the currency pair:
Prev Open: 1.3276
Prev Close: 1.3327
% chg. over the last day: +0.38 %
According to Statistics Canada, the Consumer Price Index rose to an annualized 6.9% in October. Excluding food and energy, prices decreased to 5.8%, down from 6% in September. In terms of key indicators, the consumer price index report does little to resolve the internal and external debate over the Bank of Canada’s December meeting. Governor Tiff Macklem has left the door open for another excessive increase, and the inflation data supports a downgrade to the standard 25 basis point increase.
From the point of view of technical analysis, the trend on the USD/CAD currency pair is bearish. The MACD indicator became positive, and the price is trading above the moving averages. The best way to sell is to consider the resistance level of 1.3370, but with confirmation. Buy trades should be considered on the lower time frames from the support level of 1.3270, but with additional confirmation in the form of a reverse initiative.
Alternative scenario: if the price breaks out and consolidates above the resistance level of 1.3508, the uptrend will likely resume.
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.
GBPJPY on the D1 time frame was in a brief uptrend where the bulls prevailed over the bears before a last higher top formed at 172.122 on 21 October. Supply then started to overcome demand with the resulting change in market structure.
A closer look at the Momentum Oscillator reveals a negative divergence between points “a” and “b” when comparing the tops at 170.076 and 172.122.
This could have cautioned technical traders that the uptrend was running out of steam.
After the higher top at 172.122, the price broke through the 15- and 34-day Simple Moving Averages (SMA) and the Momentum Oscillator followed by crashing through the 100 baseline into bearish territory.
A possible critical support level formed when a lower bottom was recorded on 11 November at 163.025.
The bulls are currently trying to take control of the market again, but a possible resistance level is looming near the 15-day SMA at 167.084 that might cause a lower top to form.
If the GBPJPY breaks through the critical support level at 163.025, three possible price targets could be reached from there.
Attaching the Fibonacci tool to the lower bottom at 163.025 and dragging it to the resistance level near the 15-day SMA at 167.084, the following targets can be calculated:
The first target is estimated at 160.516 (161.8%).
The second price target can be expected at 156.457 (261.8%).
The third and final target may be considered at 149.889 (423.6%).
If the resistance level at 167.084 is broken, the above situation is not applicable any longer and must be re-evaluated.
As long as the bears stay in control of the market, the outlook for the GBPJPY currency pair will remain bearish.
– A sense of unease gripped financial markets on Wednesday as a rocket blast in Poland overnight left investors on edge.
Renewed fears of further escalation in geopolitical tensions dragged European markets lower with the risk-off sentiment hitting US equity futures. In the currency space, the dollar got no love which offered an opportunity for G10 currencies to fight back. While gold found comfort above $1780 as market players rushed to safe-haven destinations.
Looking at the economic calendar, dollar volatility could be around the corner as investors closely scrutinize speeches from numerous Fed officials and US economic data. Just this afternoon US retail sales surged 1.3% month-over-month in October after the flat reading in September. Although this report beat market expectations, buying sentiment towards the dollar remained muted. As the week progresses, the developments surrounding the missile blast in Poland are likely to influence sentiment, especially if investors remain jittery about the prospects of further escalation.
With dollar bears marking their territory and the fundamentals pointing to further weakness down the road, G10 currencies could strike back hard.
EURUSD hits 200-day SMA
A broadly weaker dollar has inspired EURUSD bulls to rally over the last few days. The currency pair has turned bullish on the daily charts with the MACD trading above zero. The 1.0427 level could be a tough nut to crack but a strong breakout above this point may open a path toward 1.0530. If prices are capped below 1.0427, the next key point of interest can be found at 1.0280.
GBPUSD breaks above 1.1850
Sterling pushed higher on Wednesday after the latest UK inflation figures jumped to a 41-year high of 11.1% in October, exceeding market expectations. This development may re-kindle expectations around the Bank of England raising interest rates aggressively to combat soaring prices. A weaker dollar has also played a role in the GBPUSD’s rally as prices approach levels not seen since mid-August. Looking at the technicals, another solid daily close above 1.1850 could trigger an incline toward 1.2050. Alternatively, a move back under 1.1850 may see a sell-off towards 1.1750 and 1.1500, respectively.
AUDUSD to challenge 200-day SMA?
If the dollar continues its slippery decline, this could push the AUDUSD toward 0.6850. A strong breakout and daily close above 0.6850 has the potential to encourage a move higher toward 0.6950. Should bulls run out of steam before hitting 0.6850, bears could target the 0.6700 level.
USDJPY lingers around 139.50
The trend is bearish on the USDJPY as there have been consistently lower lows and lower highs. Sustained weakness below 139.50 could trigger a selloff towards 137.50 and lower. Should prices stage a rebound back above 139.50, prices could challenge 142.00
Commodity spotlight – Gold
Gold seems to be on standby as investors digest the latest US retail sales data and developments revolving around Poland. However, the precious metal may resume drawing strength from a weaker dollar and subdued Treasury yields as the trading week progresses. Given how the dollar may be influenced by the numerous speeches from Fed members and US economic data, this could find its way back to gold which is trading below $1780 as of writing.
Gold remains bullish on the daily charts as there have been consistently higher highs and higher lows. A solid move above $1780 could encourage an incline towards the psychological $1800 resistance level – where the 200-day SMA resides. Should this resistance prove to be a tough nut to crack, prices could descend back below $1780 with the next key level of interest found at $1750 and $1715 – just above the 100-day SMA.
The pair has secured under the Tenkan-Sen line and is preparing to develop a correction by the Head and Shoulders pattern. The pair is going above the Ichimoku Cloud, which indicates an uptrend. A test of the Kijun-Sen line at 1.0220 is expected, followed by growth to 1.0685. An additional signal confirming the growth will be a bounce off the lower border of the bullish channel. The scenario can be cancelled by a breakaway of the lower border of the Cloud and securing under 0.9935, which will entail further falling to 0.9845.
USDCAD, “US Dollar vs Canadian Dollar”
The pair is testing the support area, going under the Ichimoku Cloud, which indicates a downtrend. A test of the lower border of the Cloud at 1.3345 is expected, followed by falling to 1.2985. An additional signal confirming the decline will be a bounce off the upper border of the descending channel. The scenario can be cancelled by a breakaway of the upper border of the Cloud and securing above 1.3575, which will entail further growth to 1.3665.
GBPUSD, “Great Britain Pound vs US Dollar”
The pair is correcting inside a bullish channel, going above the Ichimoku Cloud, which suggests an uptrend. A test of the Kijun-Sen line is expected at 1.1720, followed by growth to 1.2345. An additional signal confirming the growth will be a bounce off the lower border of the ascending channel. The scenario can be cancelled by a breakaway of the lower border of the Cloud and securing under 1.1355, which will entail further falling to 1.1265. The scenario can be confirmed by a breakaway of the upper border of the bullish channel and securing above 1.2105.
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.
The market major on Wednesday preserves its impulse of growth. The current quote is 1.0350.
The main reason for the crash of the USD and the sky-rocketing of the EUR is the all-market strong belief that at the meeting in December the Federal Reserve System will change its policy. Looks like these are the expectations on which the market will keep buying until it gets facts.
At the same time, the number of risks for the euro is growing. For example, spot gas prices in Europe are heading up high. Yesterday they leaped up by 16%. As long as the heating season has started, there may occur too many surprises, and the EUR will inevitably react to them. These are inflation prospects, which are extremely important for the currency.
The second GDP assessment in the Euro zone in Q3 demonstrated growth of the economy by 0.2% m/m as expected. Curiously, the German GDP inside the EU is growing slower than that of France or Spain. Germany used to be the economic locomotive of the alliance but has recently lost the ability to pull the whole of the EU forward.
Today the US will publish two important economic indicators. One is the retail sales report for October. It might have grown by 0.9% m/m, which would be productive after zero change in September. Moreover, industrial production data are also to be published, and in October it should have grown by 0.2% m/m after growing by 0.4% in September. The better the statistics turn out, the better for the USD.
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.
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