Forex Signals Brief for December 13: US Inflation to Cool to 7.3% Before Tomorrow’s FED Hike
Yesterday’s Market Wrap
Yesterday started with the UK GDP report for October, showing a decent improvement from the previous two months which were negative. That helped the GBP keep a bullish momentum during most of the day, while most of the market traded in a tight range as traders are awaiting a big week ahead, which starts with the US consumer inflation later today.
Crude Oil declined around $1.50 in the Asian session as the week started in a tense mode, but then we saw a strong bullish reversal off the support area above $70 which came after news that the Keystone Pipeline would continue to remain closed. Although the surge stalled below $74 and the WTI price cooled off a bit. Gold on the other hand was bearish throughout the day.
Today’s Market Expectations
Today started with the final German CPI number which showed a 0.5% decline in November which is a positive thing, although it has come mostly from fuel while food continues to remain expensive. The Average Earnings Index and the Unemployment rate from the UK were released a while ago, although today the big event comes in the US session. The UK consumer inflation CPI (consumer price index) report will be released and it is expected to show a decent slowdown to 7.3% in November from 7.7%. This is the last piece of important economic data from the US before the FED rate decision tomorrow evening.
Forex Signals Update
Yesterday we came from a really great weak with an 80% success rate from our trading signals last week. The start yesterday was a bit rough, as markets remained choppy, despite the low volatility, apart from commodities. We had seven signals closed, five of which ended up in profit while only two in a loss, so it was a great day after all.
Booking Profit on EUR/JPY
Last month we saw a retreat lower in EUR/JPY, but this month the uptrend has resumed again. On the H4 chart, this pair fell below the moving averages last month but has reversed back up and now moving averages have turned into support. The 50 SMA (yellow) held the retreat earlier last Friday and we saw a bounce that sent the price above moving averages once again.
EUR/JPY – 240 minute chart
Turning Bearish on GOLD
Gold turned bearish on Friday after peaking above $1,800 and yesterday it remained bearish all day. Moving averages were acting as resistance at the top, pushing the price lower and we decided to open a sell signal after the retrace to the 50 SMA (yellow) on the 5 minutes chart.
XAU/USD – 5 minute chart
Cryptocurrency Update
Cryptocurrencies have been bullish earlier this month, as the sentiment improved in financial markets, although on Sunday afternoon we saw a slight bearish reversal. Yesterday they continued lower in the Asian session, but then started to reverse higher in the European session and continued the crawl up, with low volatility.
The 100 SMA Supporting BITCOIN
Bitcoin has been displaying some slight bullish pressure since forming a support zone around $15,600 in November. In the last few months, BTC has crawled higher as the sentiment improved in the financial markets. Although, last week markets traded mostly sideways as the sentiment remained neutral and after the retreat earlier yesterday the 100 SMA (green) held as support and the price started to bounce off that moving average.
BTC/USD – 240 minute chart
ETHEREUM Remains Subdued by the 50 SMA
Ethereum continues to be on a downtrend overall, as it keeps making lower highs on the daily chart and buyers still look weak. The last attempt to turn bullish ended at the 200 SMA (purple) and now buyers are testing the 50 SMA (yellow) which is keeping them in check. Although the price has been stuck too long to this moving average, so it will probably break soon, since there hasn’t been any strong rejection.
ETH/USD – Daily chart
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