Last Week’s Market Wrap

September was quite volatile, with the USD surging as the only safe haven left, as the UK bond market went crazy, until the Bank of England intervened, and it continues to buy UK Gilts, lowering bond yields below 4%, although they have started to pick up again. That improved the sentiment and the USD turned bearish in the last week of September as the only remaining safe haven, continuing lower in the first two days of last week.

The slowdown in US ISM manufacturing and JOLTS job openings hurt the sentiment for the USD further, lowering the odds of FED rate hikes. Although the economic data from the US showed improvement as the week progressed, particularly the ISM services figures, and the sentiment improved again. The RBNZ and the RBA raised interest rates by 50 bps each, but the NZD and the AUD didn’t benefit much from it, as both central banks are expected to slow down or pause with rate hikes for now.

This Week’s Market Expectations

The first part of this week is expected to be quiet, with the US on a bank holiday today, while tomorrow the average earnings index from the UK will be the main release. On Wednesday the UK GDP report for August will be released, followed by the US producer inflation PPI index and the FOMC meeting minutes. Thursday is the important day when the US consumer inflation CPI index is scheduled to be released, which is expected to have a sizeable impact on the USD.

Forex Signals Update

Last week the volatility continued, although it was much quieter than in the previous week. In the first two days, the USD continued to retreat, but then reversed and turned bullish. We opened 23 trading signals in total, mostly in forex, while in commodities we concentrated on Gold, which was quite profitable for us once again. We closed the week with 16 winning forex signals and 7 losing ones, giving us a 70/30% win/loss ratio.

Remaining Short on GOLD 

Gold turned bullish two weeks ago as the USD turned bearish, climbing above $1,700. The USD reversed higher last week, although Gold was holding up well until Friday, until we saw a decline below $1,700. We decided to open a sell Gold signal after the retrace higher to the 20 SMA following the US employment report which sent the USD jumping higher, and booked profit as the 20 SMA rejected the price.

XAU/USD – 15 minute chart

Selling EUR/USD 

EUR/USD turned really bullish i the last weekof September and the first two days of last week, until it reached parity and then started reversing lower. it has lost more than 250 pips during the decline and we have turned dovish on this pair. We reversed to selling EUR/USD during retraces higher at moving averages, which turned into resistance in the second part of the week.

EUR/USD – H1 chart

Cryptocurrency Update

Cryptocurrencies have been trading in a range for more than a month, with Bitcoin trading above and below $20,000. Early last week cryptocurrencies turned bullish and BTC increased above that major level, but with the bullish reversal in the USD and the risk sentiment turning negative, crypto coins turned lower again from the top of the range, apart from Ripple, which continues to make gains.

Looking to Buy BITCOIN at the Lows

Bitcoin has been trading sideways, mostly below $20,000 but moving above that level at times as well, with the 200 SMA (purple) acting as resistance at the top. On Wednesday we saw a bullish move and buyers pushed above the 200 SMA which has now turned into support for some time, but it broke that moving average as the USD gained momentum. But, that’s good since we’re looking to buy BTC near the lows above $18,500.

BTC/USD – H4 chart

XRP/USD Continued the Bounce

Ripple has been bullish since the middle of last month, surging above $0.50 last week, as the lawsuit against the SEC saw some developments. The price has retreat, so the bullish momentum coned lower a couple of times, but the 20 SMA (gray) has turned into support, holding the price, while the 200 SMA (purple) turned into resistance for some time. Although last week we saw a breakout of the triangle to the upside so the bullish momentum continues.

XRP/USD – Daily chart