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Yesterday’s Market Wrap
As prices have risen and central banks have continued to raise interest rates without affecting prices, traders and investors have worried that the global economy could slip into recession. We’ve seen some weak numbers over the past few weeks, but yesterday we saw some real evidence. European and US services and manufacturing reports showed a significant slowdown in growth.
This puts central banks in a difficult position as further rate hikes will surely mean a recession. The Fed’s Jerome Powell confirmed no further sharp hikes making the USD uncertain but at this point all currencies are uncertain about the future.
The data agenda today
Today the economic calendar is light as UK retail sales are released earlier as well as the German Ifo business climate which has weakened further. Later today we have a number of central bankers to speak from, starting with the RBA’s Lowe, who should have some influence on the AUD, followed by the Fed’s Bullard, who is a hawk, to members of the Bank of England (BOC). In the US session we will see if US-ME consumer sentiment will be revised down.
Yesterday we have many trading signals in forex as well as raw materials. The movements were small, but there was no direction and there were many zigzag movements. We had more success in commodities than forex, but ended the day with a tie, four wins and four losses.
GOLD – sell signal
Gold has continued the downtrend since March, but over the past few weeks we have seen gold trade sideways. The price has been up and down and we recently made some good profits trading XAU/USD. Yesterday we decided to open a sell signal here during the reversal to the downside and take profits at the daily lows around $1,823.
XAU/USD – H1 chart
STI Oil – sell signal
Crude oil has seen a sharp reversal since last week, particularly on Friday when it plummeted around $10. We attempted to pick trades during this reversal by selling retracements at the 20 SMA (grey) on the H4 chart. Earlier this week we sold WTI Oil at this moving average while opening another sell signal yesterday which also closed in profit.
Crude Oil – 240 minute chart
cryptocurrencies continue to trade sideways after crashing late last week and reversing on Sunday. During this week we have seen some attempts to resume the decline but buyers have stepped in and shown buying pressure. So there is a possibility that cryptocurrencies could have bottomed here.
MAs become support for ETHER?
Ethereum has shown strong selling pressure since last November, falling below $1,000 last Saturday before bouncing back sharply above this key level on Sunday. The continuation since Sunday has been weak but buyers have been slowly pushing higher. Now ETH/USD has climbed above the 50 SMA (yellow), which may have turned into support, which is a bullish sign.
ETH/USD H4 chart
The 100 MSA hold ETH/BTC bearish
ETH/BTC was in an uptrend for several years but turned bearish in December of last year and was in a downtrend, using moving averages as Resistance acted on the H4 chart. The recent pullback ended higher below the 100 SMA (green) and we decided to open a sell signal as the sellers are still in control.
ETH/BTC – H4 chart
Source: Crypto News Deutsch