The global economy heading into a recession as manufacturing contracts

Forex Signals Brief for January 3: Global Manufacturing in Contraction Besides Switzerland

Posted Tuesday, January 3, 2023 by
Skerdian Meta • 2 min read

Yesterday’s Market Wrap

Yesterday most markets were closed for the New Year bank holiday weekend and certain markets were closed, although there was some sort of price action. There weren’t any clear signs anyway, as commodity dollars slipped lower while the European stock markets opened higher and continued to climb in the first hours of the morning. Although the liquidity was minimal, so today is the first day of trading. Yesterday we had the final manufacturing PMI numbers from UK, Germany, France Spain, Italy and France, all of which remained in contraction in December, with only Spain showing some improvement.

This Week’s Market Expectations

Today the volatility has picked up somewhat as the new year gets underway and we’ll be trying to pick trades. The economic data started with China’s final manufacturing PMI reading for December which was slightly weaker, remaining in contraction. The UK, US and Canadian final manufacturing figures for December will be released later, all of which are expected to show contraction again, apart from Swiss manufacturing which remains in expansion.

Forex Signals Update

yesterday was quiet during most of the day, apart from the early European session when we saw a move against risk currencies in the forex market. Our buy USD/CAD went further in our direction as a result, while we also opened another signal yesterday, but it remains open as the price action faded in the US session.

 USD/CAD Fails at the 200 SMA

USD/CAD has been trending down siin ce october, although the pace of the decline has been slow, which shows that the CAD remains weak despite the pronouned weakness in the USD. Although buyers are starting to come back and yesterday we saw a jump higher, but the 200 SMA (purple) turned into resistance and rejected the price.

USD/CAD – 60 minute chart

Buying GOLD Again  

Gold continues to be one of the most bullish assets since it turned reversed higher in November. So we decided to turn bullish on Gold as well last month which brought us many winning trading signals. The pace of the uptrend slowed down, but moving averages held as support and we kept buying against the 100 SMA (green), booking profit as buyers pushed the price higher.

XAU/USD – 240 minute chart 

Cryptocurrency Update

Cryptocurrencies started 2022 on a bearish foot and ended it like that, after the strong decline which sent them more than 50% lower since the beginning of 2022. The last week of the month was also bearish as sellers returned, alth0ough yesterday we saw a reversal in most major crypto coins so it is a good tart at least.

BITCOIN Facing the 100 SMA

Bitcoin made another bearish move in November after the crash in the crypto martket, following the FTX bankruptcy, but the pirce has been trading sideways since then. We decided to open a buy Bitcoin signal andd yesterday buyers came back, although BTC was fidning resistance at the 100 SMA (green).

BTC/USD – 240 minute chart

 ETHEREUM Pushing Above $1,200

Ethereum has also been showing selling pressure after falling from almost $4,000 at the beginning of last year. It has beenvmaking lower highs since then but in the last 2 months lowshave been getting higher too. Moving averages are providing resistance at the top though, while buyers are active at $1,000-$1,100.

ETH/USD – 240 minute chart
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