Forex Signals Brief for February 29: US Retreats on Softer Consumer Sentiment

Yesterday’s Market Wrap

Markets have been trading the US economic data in the last two months, as the FED shifts the rhetoric from less hawkish into more hawkish with the improvement in the economy. The USD has been bullish as the data has shown a decent bounce in the last several weeks. Although this week we have seen some weak numbers, first from the durable goods orders on Monday, although capital orders increased, and yesterday the CB consumer confidence softened.

The CB Consumer consumer confidence indicator was expected to show a slight improvement this month, but it softened from 207.1 to 102.9 points this month and last month was revised lower. The USD retreated, especially against the Yen and Gold, although this won’t change the FED rhetoric. In the end, the CAD ended up the weakest among major currencies, after the December GDP showed a 0.1% decline.

Today’s Market Expectations

Today started with the inflation and GDP reports from Australia. Inflation cooled off while the economy showed a slight improvement in Q4. Today is a manufacturing day, with the European and UK manufacturing PMI reports being released this morning, although not showing much change, as this sector remains in contraction. The uS ISM manufacturing numbers will be released later in the afternoon, although they are expected to show a similar situation.

Forex Signals Update

Yesterday the USD continued the retreat that it started on Monday, and the decline escalated after the CB consumer confidence numbers. We opened five trading signals, two of which closed in loss as we were caught on the wrong side of the USD while one closed in profit, so we had a positive day after all.

Shorting GOLD at the 50 SMA

The 50 SMA (yellow) has been acting as resistance since the middle of this month and right now the price has stalled its advance higher just below this moving average. So, we decided to open a sell Gold signal at this moving average and are hoping that the bearish trend continues.

XAU/USD – 60 minute chart 

Booking Profit in [[EUR/USD]]

EUR/USD climbed around 90 pips higher yesterday, although this pair is still driven mostly by performance in the USD, which is looking bullish since the beginning of February.  The 50 MSA (yellow) is also acting as resistance at the top and we decided to open a sell forex signal, which closed in profit after the rejection.

EUR/USD – 240 minute chart

Cryptocurrency Update

Cryptocurrencies have been on an uptrend since January, with Bitcoin pushing above $25,000 but pulled back down last week as the USD resumed the bullish momemtum and risk sentimet deteriorated. They are now in another consolidating period, although we saw some bullish momentum pick up yesterday, so let’s see if buyers will come back this week.

BITCOIN Consolidating Before the Next Move

After the bearish reversal last week, Bitcoin buyers are showing some signs of exhaustion as it has retreated below moving averages on the H4 chart. Bitcoin has failed to hold above $25,000 three times earlier this month as the uptrend resumed from January and now moving averages have turned into resistance, with the 50 SMA (yellow) rejecting the price yesterday.

BTC/USD – 240 minute chart

The 50 SMA Acting As Resistance ETHEREUM 

Ethereum has made some decent gains and it continues to remain bullish on the daily chart, although it is also finding it hard to hold gains above $1,700. The 50 SMA (yellow) is acting as resistance right now on the H4 chart, rejecting the price several times.

ETH/USD – 240 minute chart