We saw a positive surprise in the USD after retail sales

Forex Signals Brief for September 16: Retail Sales Suffering on Record Prices

Posted Friday, September 16, 2022 by
Skerdian Meta • 2 min read

Last Week’s Market Wrap

Yesterday all eyes were on the US retail sales report, after last week’s CPI inflation report. Although before that there were some economic releases such as the Q2 GDP report from New Zealand, which was expected to show a 1% increase, while it came at 1.7%. Australian employment missed expectations during the same period, with the unemployment rate ticking up to 3.5%.

In the afternoon, the US retail sales posted a decent number, increasing by 0.3% against -0.1% expected. Although the headline number was disappointing, as most of the other components came in negative. July was revised lower to -0.4% from 0.0%, core sales excluding autos came at -0.3%% vs +0.1% expected, while the control group fell flat at 0.0% vs +0.5% expected. The Empire State Manufacturing Index improved this month while the Philly Fed Manufacturing Index declined, so the divergence continues, although the US was little changed after the reports were released.

This morning the retail sales and fixed asset investment showed weakness again in China, as lockdowns continue in the country. UK retail sales posted another decline in the UK this morning, which shows that surging prices are starting to weigh on consumption. Later in the US session, we have the US prelim UoM consumer sentiment as well as inflation expectations.

Forex Signals Update

Yesterday the volatility was not too high, although there was enough price action in financial markets to pick some good trades and keep the risk low at the same time. We opened four trading signals in total in forex and in commodities once again, all of which closed in profit, so we continue with the positive performance.

Buying USD/JPY at MAs

USD/JPY continues to remain bullish, despite the retreat lower yesterday. Moving averages continue to provide support on the H1 chart, and we continue to open buy signals during pullbacks lower. Yesterday we opened another buy signal at the 100 SMA which closed in profit.

US Oil – 60 minute chart

Continuing to Sell GOLD  

Gold resumed the decline last Wednesday after the US CPI inflation continues to show another increase in August. The price consolidated for several days after that, trading in a tight range but the decline resumed again on Wednesday this week and we started to open sell Gold signals. Yesterday we opened two such Gold signals, both of which closed in profit.

Gold XAU – 15 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.

Is the 20 SMA Going to Hold As Support 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 and buyers reached the 100 SMA (green) on the daily chart. But the post-CPI crash on Tuesday turned this cryptocurrency bearish, sending the price below $20,000. Although the 20 SMA (gray) is acting as support and after Wednesday’s candlestick, it seems like the chart is forming a bullish reversing setup.

BTC/USD – Daily chart

Ethereum Still 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

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