The US Dollar’s strength continued last week, with the Euro and the Sterling being among the weakest currencies. Despite the increase in the CPI (Consumer Price Index) in the UK by 0.5%, the GBP only appreciated temporarily. Overall, the Sterling got weakened. After positive CPI, if the currency doesn’t follow through and gain strength, it is a sign of extreme weakness in the currency’s country's economy. Among the strongest currencies were the Australian Dollar and the Japanese Yen.
On Monday, the only two significant events will directly affect the Euro. During the London trading session in Germany, the IFO Business Climate Index is expected to decrease from 86.5 to 86. We expected to see weakness in the Euro, but not in a way that would allow for any major trend reversal on the price charts. During the New York trading session, we expect volatility to pick up. The last significant event for the day will be the speech of ECB (European Central Bank) Chief Economist Lane.
On Tuesday, during the Asia and London trading sessions, volatility is expected to be as usual as no major news events will be reported. The volatility during the New York trading session is expected to rise. First, in the US, they will report on CB Consumer Confidence. The forecast shows an increase from 108.7 to 112.0. At the same time, they will also report New Home Sales, and the forecast shows a decrease from 738K to 724 K. We expected the volatility to be noticeable at that time with large fluctuations of the price of USD on major currency pairs and the US Indices. Towards the end of the New York session, the FOMC Minutes will take place. Day trading during that time must be approached cautiously not only because of the increased volatility but also because, right after the event, the market will start drying up in terms of liquidity.
The volatility is expected to become noticeable early in the morning during the Asian trading session on Wednesday. In Australia, they will report the CPI (Consumer Price Index). The consensus estimates an increase of 0.4%, which means that the CPI will increase from 2.1% to 2.5%. As of last week, the Aussie was considered one of the strongest currencies. If the actual report confirms the forecast and the market follows through simultaneously, we can expect a rise in the AUDUSD and a drop in the EURAUD and GBPAUD. The next significant event will be the Interest Rates in New Zealand. The current rates set by the RBNZ (Reserve Bank of New Zealand) are 4.75%, and they are expected to reduce them to 4.25%. If the actual report confirms the forecast and the market follows through, a weakness of the NZD will be evident, and sell trading opportunities on the NZDUSD will be favourable. At the same time, the RBNZ will release its Monetary Policy Statement and Press Conference. The next significant event will be the GDP (Gross Domestic Product) in the US. The consensus estimates an unchanged 2.8%. Next will be the Unemployment Claims in the US, and the forecast shows an increase from 213K to 220K this time. The last significant event for the day will be the DGO (Durable Goods Orders) still in the US, which is expected to increase significantly from -0.7% to 0.4%. The volatility during the release of the news will be intense, and the price fluctuation needs to be taken into consideration while day trading.
Thursday is expected to be a short day in terms of significant news events. The first event for the day will be the RBA (Reserve Bank of Australia) Governor’s speech, Bullock. Usually, we get an idea of how they see Australia’s economy. As for now, Australia hasn’t cut Interest rates, while other major banks already cut their rates, especially in case of an increase in CPI on the previous day. Moving into the London trading session, the markets are expected to trade as usual, as we won't have any significant news events that are expected to affect the volatility of any currency directly. Moving into the New York trading session, the Bank in the US will be closed due to Thanksgiving Day. Therefore, both the volatility and the liquidity of the US Dollar are expected to be minimal.
Regarding the Futures markets, CME Group's Trading of its precious metals, US Oil and Foreign Exchange Futures Contracts ended ahead of schedule at 03:45 Beijing time on the 30th, and trading of stock index futures contracts ended ahead of schedule at 02:15 Beijing time on the 30th. The last significant event for the day will be the German Prelim CPI (Consumer Price Index), which affected the Euro directly. The forecast indicates a decrease from 0.4% to -0.2%. If this happens and the market follows through, we expect a significant drop in the price of the Euro. This can create trade opportunities to sell the EURSUD and the EURJPY. As of now, the technical analysis supports this forecast. If, by the time of the reported event, the technical charts change, we must reevaluate the information.
This Friday will be the last trading day of the week, as well as the last trading day of November. The volatility is expected to be noticeable early in the morning during the Asian trading session as Japan will report its Unemployment Rate. The forecast estimates an increase from 2.4% to 2.5%. This can cause the Japanese Yen to experience some weakness if the actual report confirms the forecast. Next, they will report on Retail Sales in Japan. The consensus estimates a significant increase from 0.7% to 2.2%. What will give significant bullish momentum to the Japanese economy is if both events are reported in favour of the JPY. Moving into the London Trading session, it is Switzerland’s time to report its GDP (Gross Domestic Product). The forecast estimates a decrease from 0.7% to 0.4%. As we will see below on the USDCHF chart analysis, the Swissy is very weak, and if this weakness continues due to a weak GDP, the price of the USDCHF currency pair can continue to increase.
A few hours later, in the Eurozone, they will report the CPI (Consumer Price Index) Flash Estimate. The consensus shows an increase from 2.05 to 2.3%. This can give some boost to the Euro in case the actual confirms the forecast. The last significant event for the day will be the GDP (Gross Domestic Product) in Canada. Last week, the Loonie (short for the Canadian Dollar) was appreciated after a strong CPI report. This time, if the actual report is positive and simultaneously if the market follows through, the Canadian Dollar’s strength is expected to continue. The EURCAD and GBPCAD are the intermediate downwards, and this can help with more weakness and potential sell trading opportunities.
EUR USD 4H
Following the previous week’s Market Outlook, the price of the weekly chart continues declining, creating another Bearish Continuation candle. On the 4-hour chart, the price is still below the 20- and 50-period moving averages, which is bearish. Last Wednesday, the price tested the FVP (Fair Value Price) we pointed out in the previous week’s Market Outlook, and then it declined. It moved downwards, creating a new lower low formation last Friday. The RSI is below its lower boundary of 30, which means the Oscillator is in an Oversold condition, and this has bearish implications. Starting Monday, if the price continues to move downwards, the first support area, S1, will be around 1.03319, which is the previous week’s low. If the price penetrates the S1 and keeps lowering the next support area, S2 will be at an older weekly level at 1.02904. A further downward move will find the next support level at 1.02227.
On the other hand, if the price bounces off and moves upwards, it will start a retracement phase. In this case, the First Resistance area R1 will be an Inside Resistance around 1.04963. This level is considered a significant level of resistance because it coincides with the 4-hour FVP (Fair Value Price) created last Thursday, the 20-period moving average and the 61.8% Golden Ratio Fibonacci. If the price penetrates R1 and keeps increasing, the next area of resistance, R2, will be around 1.06098, which is the previous week’s high. This is also considered a key level of resistance because it consists of the Bearish Engulfing Order Block created last Wednesday and also the 50-period moving average. If the price penetrates the R2 and keeps moving upward to the next resistance area, R3 will be around 1.06546.
GBP USD 4H
The previous week’s price action ended as another Bearish candlestick. But that time, the weekly candlestick had a noticeable Upper Wick. On the 4-hour chart, the downtrend continued as the price last Wednesday printed a Bearish Engulfing candlestick, rejecting the 20-period moving average. The 20-period is below the 50-period moving average, which is bearish. The RSI Oscillator is in an Oversold condition, which indicates the price’s strong bearish pressure. Last Thursday, the price penetrated the swing low at point (a), creating a Bearish Order Block around 1.26500 and an FVP (Fair Value Price) around 1.25994. Starting Monday, if the price continues to move downwards, the first support area, S1, will be around 1.24872, which is the previous week’s low. If the price penetrates the S1 and keeps lowering, the next support areas, S2 and S3, will be at 1.24457 and 1.22994, respectively. If the price starts a retracement phase, meaning it will move upwards, the first resistance area, R1, will be an Inside Resistance around 1.25973. If the price penetrates the R1 and keeps increasing, the next resistance area, R2, will be the previous week’s high at 1.27149.
AUD USD 4H
The Australian Dollar was one of the strongest currencies last week, along with the US Dollar. Therefore, the AUDUSD’s price action on the weekly chart ended as an Inside candle with a Bullish close. Looking at the 4-hour chart, the price last week kept trading within the Upper and Lower Bands of the Bollinger Band Indicator. The 4-hour Bearish Engulfing Order Block, which is around 0.65700, is still valid from last week. The RSI is flat around its middle line of 50. The MACD is above its zero line, and this has bullish implications. Currently, the price is below the 20-period moving average, which is the middle of the Bollinger Bands. Starting Monday, if the price moves upwards, the first resistance area, R1, will be around 0.65446, which is the previous week’s high. If the price penetrates the R1 and keeps increasing, the next resistance is an R2, which will be around 0.65984, which is an older weekly level. Oppositely, if the price is rejected, penetrates the Lower Band, and moves downwards, the first support area, S1, will be the previous week’s low, around 0.64480. If the price penetrates the S1 and keeps lowering, the next support area, S2, will be at 0.63484.
USD JPY 4H
Last week, the Japanese yen was among the strongest currencies. Therefore, the price of the USDJPY ended as an Inside candlestick on the weekly chart, showing a Long-legged Doji candle. On the 4-hour chart, the price was trading within the Upper and the Lower Band of the Bollinger Band Indicator. Last Tuesday, the price tested the 4-hour Bullish Order Block, as we pointed out on the previous week’s Market Outlook, and then bounced off and moved upwards, reaching the FVP(Fair Value Price) around 156.000 last Wednesday, which, after being rejected and moved downwards. Since then, the price has moved sideways around the 20-period moving average, which is the middle of the Bollinger Band indicator. Starting Monday, if the price declines and moves downwards, the first support area, S1, will be at 153.280, which is the previous week’s low. If the price penetrates the S1 and keeps lowering, the next support area, S2, will be around 152.666. A further move to the downside will find the S3 support area, around 151,284. Oppositely, if the price bounces off and moves upwards, the first resistance area, R1, will be around 155.890, which is the previous week’s high and also is the same price level at which the Upper Band is trading. If the price penetrates the R1 and keeps moving upwards, the next resistance area, R2, will be an older weekly level at 156.751.
USD CHF 4H
The Swiss Frank's weakness was evident during the week, and the price of the USDCHF, for the sixth week in a row, ended as a Bullish Continuation candle. On the 4-hour chart, the price bounced the Bullish Order Block last Tuesday and then moved upwards, creating a higher high formation. This created a new market structure on the price chart with a Bullish Engulfing Order Block around 0.88300 and an FVP (Fair Value Price) around 0.88700. As the price keeps making higher highs without forming any swing high, we cannot use the Fibonacci retracement tool to estimate the retracement levels. However, the RSI and the Stochastic Oscillators both became Overbought, indicating a strong bullish market. Hence, if the price continues moving upwards, the first resistance area, R1, will be around 0.89580, which is the previous week’s high. If the price penetrates the R1 and keeps increasing, the next resistance area, R2, will be around 0.89802. Oppositely, if the price moves downwards, the first support area, S1, will be an Inside Support around 0.88598. This is considered a key level of support as it consists of the levels between the 20 and the 50-period moving averages, the FVP. It is also above the Bullish Order Block. If the price penetrates the S1 and moves downwards, the next support area, S2, will be around 0.88012, which is an older weekly level. A Further downward move finds the next support area, S3, at approximately 0.87518.
GBP JPY 4H
The weekly price action on the GBPJPY currency pair ended as a Bearish Candle. The body of the candle is relatively small compared to its wicks. This is an early indication that the downward momentum may be slowing down. On the 4-hour chart, the price created a lower low formation last Tuesday, and then It bounced off, and on Wednesday, it moved upwards until the FVP (Fair Value Price) we pointed out on the previous week’s Market Outlook. The price has since been rejected and moved downwards, creating a new lower-low formation. On the same day, the price created a Bearish Order Block around 197.500, and last Thursday, an FVP (Fair Value Price) around 195.800. The 20-period is still below the 50-period moving average, and this is bearish. The RSI Oscillator is below its middle line of 50, and this has bearish implications. The MACD is below the zero line, and this also has bearish implications. The MACD’s Histogram is declining, indicating bearishness. Starting Monday, if the price keeps moving downwards, the first support area, S1, will be around 192.852, which is the previous week’s low. If the price penetrates the S1 and keeps lowering, the next support area, S2, will be around 189.565. Oppositely, if the price bounces off and moves upwards, the first resistance area, R1, will be around 197.790. If the price penetrates R1 and keeps increasing, the next residence area, R2, will be around 198.426.
GOLD 4H
As we explained in the previous week’s market analysis, the overall trend for Gold is up. Last week was a Bullish week for Gold. The weekly candlestick ended as a Bullish Marubozu candle, and this has bullish implications. On the 4-hour chart, the price moved upwards pretty much in a straight line as the retracements were very shallow. Therefore, only a few Bearish (Black) candles were created on the chart. Last Thursday, the 20-period crossed above the 50-period moving average, creating a Bullish Crossover. Last Friday, the RSI Oscillator became Overbought, indicating the strength of the GOLD market.
Additionally, the MACD is above its zero line, and its Histogram is rising, indicating bullishness. If the price continues moving upwards, the first resistance area, R1, will be at $2716, the previous week’s high. If the price penetrates the R1 and keeps increasing, the next resistance area, R2, will be around $2749. On the other hand, if the price is rejected and moves downwards, the first support area, S1, will be at $2618. This is a key level of support as it consists of the Bullish Order Block created last Wednesday during the New York trading session and the 50-period moving average. If the price, instead of bouncing off the S1, penetrates it and declines further, it can move downwards until the next support area, S2, around $2562, which is the previous week’s low.
USOIL 4H
The weekly candlestick of the USOIL market ended as a Bullish Engulfing, and the candle closed above the previous week’s candle high, which is a sign of market strength. This shows that the buying pressure is very strong, and based on that, the next week, the price is expected to continue moving upwards. Moving down into the 4-hour chart, the price created a False Breakout last Monday, formed a Double Bottom Reversal pattern and then the price moved upwards in a series of higher highs and higher lows—a Demand Zone formed around $66.50. Additionally, in the same area, the price created a Bullish Order Block. On the same day, the price created an FVP (Fair Value Price) around $68.00. Last Thursday, the 20-period crossed above the 50-period moving average, which is known as a Bullish Crossover. The RSI is above 50, and this has bullish implications. The MACD is above its zero line, and this is bullish. Starting Monday, if the price keeps moving upwards, the first resistance area, R1, will be around $71.48, which is the previous week’s high. If the price penetrates the R1 and keeps increasing, the next resistance area, R2, will be around $72.85. If the price is rejected and starts moving downwards, the first support area, S1, will be at $68.62. If the price penetrates the S1 and keeps moving downwards, the next support area, S2, will be around $66.58, which is the previous week’s low.
BTC USD 4H
Bitcoin’s Bullishness continued with another strong week, and the price reached a new ATH (All-time High) at $99650. This is the ATH at the time we created this analysis. The weekly candle ended as a Bullish Marubozu. On the 4-hour chart, the price created a new higher high but without momentum, as shown by the MACD indicator, as the MACD Line (Blue) created a lower low formation, known as Negative (or Bearish) Divergences A’ Class. This can set the price in a retracement phase. The 50-period is above the 200-period moving average, and this is Bullish. The RSI Oscillator is above its middle line of 50, and this is bullish. Last Tuesday, the BTCUSD created a Bullish Order Block of around $91000 and two days later, on Thursday, an FVP (Fair Value Price) of around $95000. Starting Monday, if the price enteres a retracement phase, it means it will start moving downwards. In this case, the FVP and the Order Block can be used as support areas. If the price won’t bounce off from these two and instead it keeps moving downwards, the first support area, S1, will be around $89400, which is the previous week’s low. If the price penetrates the S1 and keeps lowering, the next support area, S2, will be around $85300.
On the other hand, if the price resumes the uptrend and starts moving upwards, the first resistance area, R1, will be the ATH around $99650. If the price penetrates R1 and keeps increasing, the next resistance area, R2, will be $10000. As the price hasn’t created a retracement phase, we can’t use the Fibonacci Extension tool for further price targets.
E-mini SP 500 Futures, 4H
Following the previous week’s Market Outlook, the weekly chart maintained its primary trend. Also, the weekly price action ended as a Bullish Continuation candle, indicating the Buying pressure in the market after a shallow retracement. On the 4-hour chart, the price last Tuesday bounced off the FVP (Fair Value Price) we pointed out on the previous week’s Market Outlook and the 200-period moving average, and it moved upwards in a series of higher highs and higher lows. The 50-period is above the 200-period moving average, and this is bullish. The RSI is above its middle line of 50, and this has bullish implications. The MACD is now above its zero line and also has bullish implications. Currently, the price is above the 50-period moving average. Therefore, if it continues moving upwards, the first resistance area, R1, will be at $5993.50, which is the previous week’s high. If the price penetrates the R1 and keeps increasing, the next resistance area, R2, will be the ATH (All-time High) at $6053.25. On the contrary, if the price is rejected and moves downwards, the first support area, S1, will be at $54905.25. If the price doesn't bounce off, and instead of declining and moving downwards, the next support area, S2, will be at $5855, which is the previous week’s low.
US 30, 4H
The US indices rallied last week, and the US30 was the strongest out of the three major US indices. The reason is that Bullish Engulfing is created on the weekly chart. On the 4-hour chart, the price last Tuesday bounced off the 200-period moving average, it created a Bullish Engulfing Order Block around $43000, and then it moved upwards. Last Friday, the price created a noticeable FVP (Fair Value Price) of around $44100 towards the end of New York’s trading session. The 50-period is above the 200-period moving average, and this is bullish. Both the RSI and the Stochastic Oscillators are in their Overbought condition, indicating bullishness. Therefore, if the price continues moving upwards, the first resistance area, R1, will be around $$44365, which is the previous week’s high. If the price penetrates the R1 and keeps increasing, the next resistance area, R2, will be the ATH (All-time High) around $44524. Oppositely, if the price is rejected and moves downwards, the first support area, S1, will be approximately $43727. If the price penetrates the S1 and keeps lowering, the next support area, S2, will be at $42890, which is the previous week’s low. This is considered a key level of support as it coexists with the 200-period moving average and the Bullish Order Block.
GER 30 (DAX Futures), 4H
The weekly price action ended as a Bullish Hammer with a Long Lower Wick. This is a strong indication that the buy orders may force the market to keep moving upward next week. The primary trend on the weekly chart is an uptrend, but the candlestick, even though it has a bullish implication, still makes a lower high and lower low. On the 4-hour chart, until last Friday, the price was trading within a sideway move, between the range of 19000 to 19400. Last Friday, the price created a higher high formation and is expected to begin a new upward move. The 20-period moving average crossed above the 50-period moving average, and this is bullish. The RSI Oscillator is above its middle line of 50, and this is also bullish. The Stochastic Oscillator has an Overbought condition, indicating a high price upward move. Starting Monday, if the price continues to move upwards, the first residence area, R1, will be at 19420, which is the previous week’s high. If the price penetrates the R1 and keeps increasing, the next resistance area, R2, will be the 19621. If the price surpasses R2 and keeps increasing, the next resistance area, R3, will be the ATH (All-time High) at 19802. Oppositely, if the price is rejected and moves downwards, the first support area, S1, will be at 19081. If the price penetrates the S1 and keeps moving downwards, the next support area, S2, will be at 18869, which is the previous week’s low.
