Forex Signals Brief for November 30: Eurozone CPI Inflation Expected to Slow
Skerdian Meta • 3 min read
Yesterday’s Market Wrap
Last week the USD resumed the decline by the middle of the week after US PMI manufacturing showed that this sector fell in contraction while the FOMC minutes sounded less hawkish, pointing to a slowdown in rate hikes. That continued on Monday morning as well as the USD fell by another 200 pips across the board, but then we saw a sudden reversal all of a sudden and the Buck made quite a comeback.
Yesterday we saw a similar price action as the USD declined initially on optimism about a reopening of China after comments for more vaccinations for the elderly from health officials, which is not a guarantee but is a sign in the right direction. The softer German and Spanish CPI figures also helped improve risk sentiment in the European session but then USD buyers returned and risk assets ended up lower.
Today’s Market Expectations
Today started with the manufacturing and services reports from China, which showed that these sectors are still in contraction as the lockdowns continue. Consumer inflation from the Eurozone is expected to slow to 10.4% from 10.6% in October, and after the slowdown in the German and Spanish CPI, it might come even lower.
Later in the US session the second reading for the US GDP report is expected to be raised higher from 2.6% to 2.8%, while the ADP Non-Farm employment change is expected to fall below 200K. JOLTS Job Openings are expected to slow as well, while crude Oil inventories are expected at -3.2M. FED’s Jerome Powell will close the day in the evening and might give some more fuel for the USD.
Forex Signals Update
Yesterday the volatility declined although we saw a repeat of Monday’s price action in most markets, so we employed a similar strategy, which proved to be right. We opened four trading signals, in commodities, cryptocurrencies and forex, three of which closed in profit.
Booking Profit on WTI Oil Longs
The bearish momentum in crude Oil seems to be over for the moment as optimism about a possible Chinese reopening and OPEC cutting production in their upcoming meeting. Oil climbed above the 50 SMA (yellow) on the h1 chart which turned into support and we decided to open a buy Oil signal there, which closed in profit as the bullish momentum continued.
US Oil – H1 chart
Buying GOLD at the 50 SMA
Gold turned really bullish early this month as the USD turned bearish. Although the price has been stuck between the 50 SMA (yellow) at the top which rejected the price yesterday and the 100 SMA (green) at the bottom. We decided to open a buy Gold signal at the 100 SMA and booked profit as the prie bounced off that moving average.
XAU/USD – H4 chart
Cryptocurrencies stopped declining early last week with BTC finding support at around $15,500. On Monday this week, we saw another move lower but yesterday buyers returned and pushed the price higher. At the moment, both buyers and sellers are uncertain.
[[Dogecoin]] Finding Support at 200 SMA
Dogecoin surged higher after Elon Musk took over Twitter, but declined with the whole crypto market after the ETX event. Although it stopped declining and turned bullish again last week, gaining more than 50% as it pushed above all moving averages on the H4 chart. Now the 200 SMA (purple) has turned into resistance so buyers are in control.
DOGE/USD – H4 chart
[[Bitcoin] Restests the 100 SMA
Bitcoin turned bullish last week after retesting the lows on Monday at around $15,500 pushing below the post FTX exchange crash. The price moved above the 20 SMA (gray) and the 50 SMA (yellow) but the 100 SMA (green) is still holding as resistance, so we’ll see if the bullish momentum will continue this week.