Last Week’s Market Wrap
Last week the economic calendar was light, although apart from US services and Employment reports, which were decent, strengthening the case for another strong interest rate hike by the FED next week. This kept the USD bullish for most of the week, with EUR/USD reaching 1.075 on Friday before reversing higher and forming a small bullish reversing pattern, which means that we might see a bounce higher before the next assault to the parity level.
European stock markets continued the bearish trend of the previous weeks until the middle of last week but then reversed higher, joining the US stock markets and closing the week bullish. Commodities were bearish as well during more of the week, with US WTI crude Oil tumbling to $95 lows, but they reversed higher in the last two days and crude Oil closed the week above $100.
The Data Agenda This Week
This week starts with the economic forecasts from the EU, which are expected to be “dark” as IMF’s Georgieva implied last week, followed by the US CPI (consumer price index) inflation report on Wednesday, which is probably the most important data before the FED rate decision next week. On the same day, we also have the overnight rate decision by Bank of Canada which is expected to deliver another 50 bps rate hike.
The US PPI (producer price index) number will be released on Thursday which will be an indication of the upcoming inflation. On Friday it will close with the Chinese Q2 GDP report which is expected to show an increase of 1% despite all the lockdowns and port blockades, US retail sales and UoM consumer sentiment.
This week we had a good run with forex signals as the USD regained its bullish momentum, opening 22 of them and having only 5 losing ones, accumulating a nice amount of pips. We opened trading signals across all markets and four long-term signals among them, all of which closed in profit.
USD/JPY – Bullish Bias
USD/JPY has slowed the bullish momentum since the middle of June, but buyers still remain in charge as lows get higher and the 20 SMA (gray) keeps supporting this pair on the daily chart. We have been opening numerous buy signals on this pair, the vast majority of which keep closing in profit.
USD/JPY – Daily chart
Gold – Bearish Bias
Gold has been bearish since early March, with moving averages acting as resistance on the H4 chart, but the decline picked up pace last week and Gold fell to $1,730s. We tried to make the most of this swan dive, opening 6 sell signals and booking profit on five of them. According to the sentiment, we will continue to sell retraces higher in Gold.
XAU/USD – 240 minute chart
Cryptocurrencies continue to display bullish signs, despite them being week. Last week we saw a decent attempt from buyers in cryptocurrencies and we decided to close our buy crypto signal in Cardano. They reversed back down toward the end of the week, so perhaps the bullish momentum might have ended, but let’s see hwo they will perform this week.
The 20 Daily SMA Turns Into Support for BITCOIN
The larger bearish momentum in cryptocurrencies hasn’t ended yet, as Bitcoin still hangs around the $20,000 level. But they made a decent attempt last week, with BTC/USD climbing around $3,500. The price eventually reversed lower yesterday after making two doji/pin candlesticks which are bearish reversing signals. Although the 20 SMA (gray) is holding of now so let’s see if there will be a jump from there.
BTC/USD – Daily chart
LITECOIN – Pushing Against the 50 SMA
Litecoin has been bearish since last November after a failed attempt to surge higher back then. Moving averages have been doing a good job as resistance indicators, pushing the price lower, with the 20 SMA (gray) taking over in recent months as the decline has accelerated. But buyers are putting up a fight and pushing Litecoin against the 50 SMA (yellow).
LTC/USD – Daily chart