Yesterday’s Market Wrap

Yesterday markets started moving again as some traders use the period between Christmas and New Year to nurse trades before the new year, although volatility remained low. The USD was retreating for most of the day, apart from a sudden 50 pip spike which was erased eventually, which reminds us to take care of our trades as these sorts of spikes are not too uncommon in such market conditions.

Early in the morning, we saw the retail sales and housing starts decline in November, while the Bank of Japan core inflation increased to 3.9% from 3.7% previously. Although governor Kuroda said that the ultra-easy monetary policy would be sustained and that the widening of the tolerance band in the 10-year JGB was aimed at improving market function. So, the JPY continued to remain bearish, with USD/JPY gaining around 300 pips since the crash.

Today’s Market Expectations

Today all markets are open again, although most traders will be on holiday until Tuesday next week, so the volatility is expected to remain low again. The Prelim Industrial Production in Japan as well as the Pending Home Sales in the US are expected to show another decline in November, but a smaller one compared to October. We will keep an eye on the JPY to see if the decline will continue.

Forex Signals Update

Yesterday the volatility picked up somewhat so we opened several trading signals. We went short on the USD early and four forex signals closed in profit as the USD kept declining. One of the signals closed in loss as the JPY declined even faster than the JPY.

Remaining Long on EUR/USD 

EUR/USD turned bullish in October and has gained more than 10 cents as the USD remains weak, although it was trading in a range below 1.06 and 1.07 for the last two weeks. In the last two days the pressure has turned to the upside so we opened two buy EUR/USD signals, which closed in profit

EUR/USD – Daily chart

Booking Profit in GOLD

Gold has been bullish as well, although the uptrend started last month and for the last several months the 100 SMA (green) has been doing a great job in providing support on the H4 chart. We opened a buy signal late last week after the latest pullback below $1,800 which closed in profit yesterday as Gold surged higher.

XAU/USD – Daily minute chart 

Cryptocurrency Update

Cryptocurrencies were showing some buying momentum in late November and earlier this month, as risk sentiment improved in financial markets, although last week we saw most major crypto coins trade in a range. Yesterday though the selling pressure resumed again and cryptos started to slip lower.

The 100 SMA Keeping BITCOIN Below $17,000

Bitcoin surged higher earlier this month after showing some bullish momentum for several weeks. Buyers pushed BTC/USD above $18,300 but the reversal came and the pressure turned bearish again. BTC fell below moving averages and the 100 SMA (green) is acting as resistance on the H4 chart.

BTC/USD – 240 minute chart

 ETHEREUM Making Higher Lows

Ethereum also turned bearish two weeks ago after four central banks raised interest rates by 50 basis points. Although the decline has stopped and Ethereum is making higher lows since then, which shows buying pressure. Yesterday buyers failed at the 100 SMA (green) in the first attempt but they’re still in charge.

ETH/USD – 240 minute chart