Last Week’s Market Wrap

After Tuesday’s consumer inflation CPI (consumer price index) figures which showed that consumer prices are still increasing and the big selloff in risk assets, yesterday traders were focused on the producer inflation PPI (producer price index). After July’s 0.5% decline in the headline PPI number, expectations were for another cool-off by 0.1% in August.

The report released yesterday showed a slight decline in the headline PPI number as expected, but the core figure showed a 0.4% increase, which indicates divergence. So, the headline producer inflation is falling as crude Oil prices decline, although not at the pump, but the other goods and services continue to grow. Although there was not much impact on the markets from that report, and the USD continued to retreat after the surge on the previous day, while risk assets saw some relief.

Today the economic calendar is packed, starting with the Q2 GDP report from New Zealand, which showed a decent expansion after the 0.2% contraction in Q1. Employment in Australia grew in August, after a decline in July, while the French consumer inflation CPI kept growing last month.

The most important data comes in the US session though, with the US retail sales, the Empire State manufacturing index, the Philly Fed manufacturing index and the unemployment claims. if the data comes in decent, then the USD will likely resume the uptrend again as the FED rate hikes odds will probably jump higher.

Forex Signals Update

Yesterday we opened six trading signals in total in forex and in commodities, although the volatility was low after the crazy move on Tuesday after the US CPI report, so only four signals reached the target levels. Three trading signals reached the take profit targets while one closed in a loss.

Trying the Downside in GOLD  

Gold was slowly climbing higher this month, until it crashed lower yesterday, following the increase in the US consumer inflation in August. We got a trade during the decline as we opened a sell Gold signal and yesterday my colleague Arslan opened another short-term sell signal but there was no continuation below $1,700, so that signal closed in a loss.

Gold XAU – 60 minute chart

 Selling WTI Oil at MAs

crude Oil has been making a decent comeback since the $17 decline earlier this month. Although moving averages have been acting as resistance at the top and we decided to open a sell forex signal at the 100 SMA (green) on the H4 chart yesterday. We booked profit as the 100 SMA rejected the price, sending it down to the 50 SMA (yellow) before reversing higher again.

US Oil – 240 minute chart

Cryptocurrency Update

Cryptocurrencies turned bearish again on Tuesday after being bullish for several days, as they made some decent gains. But, the reversal in the risk sentiment sent them lower on Tuesday and yesterday buyers were nowhere to be seen. The decline resumed again, but the selling pressure was slow, so we might see a bullish reversal eventually.

The 20 SMA Turning Into Resistance for BITCOIN

Bitcoin was making some strong gains since last Wednesday. It came back from the dead after falling below $19,000 and continued to push higher above $22,500, with the 20 SMA 9gray) acting as support on the H1 chart. But the post-CPI crash on Tuesday turned this cryptocurrency bearish and yesterday the 20 SMA turned into resistance.  Although the price remained above $20,000.

BTC/USD – H1 chart

Ethereum Hovering Around $1,600

ETHEREUM was showing buying pressure as well but Tuesday’s crash put the buyers off. Although the decline was not as big as in Bitcoin. ETH/USD fell below $1,600 briefly but there was no follow-through and the price continued to remain around $1,600, so we decided to open a buy signal which remains live.

ETH/USD – 240 minute chart