Forex Signals Brief June 9: Markets Remain Sensitive to the Data

Yesterday’s Market Wrap

This week we had two surprise hikes by two major central banks such as the Reserve Bank of Australia on Tuesday morning, followed by the the Bank of Canada 25 bps hike on Wednesday. This could mean a 25 bps hike by the FED as well this month, but at the same time the FED could pause after the hikes by the RBA and the BOC, as this already brings some disinflationary pressures globally.

As a result, the sentiment was mixed yesterday and most of trading assets were bouncing in a tight range during the European session. But, the unemployment claims from the US showed a jump to the highest since October 2021 and the odds for another FED hike in June diminished. That sent the USD lower and most of t=other assets higher, with Gold taking advantage the most of this uncertainty.

Today’s Market Expectations

Today started with inflation reports for May from China. Consumer inflation CPI remains very low at 0.2% despite ticking higher, while producer inflation PPI saw another major decline of 4.3% after falling by 3.6% previously. The European session is very light but later in the US session the unemployment rate is expected to tick higher in Canada despite unemployment claims expected to halve from last month.

Forex Signals Update

Yesterday we were short on the USD, with markets trading without direction during the Asian and European sessions. But the US unemployment claims came weaker than expected which sent the USD lower and we lost those two signals, although we reversed to short on the USD and had two winning signals later in the day.

GOLD Stagnating Today

Gold’s bullish trend was interrupted in early May, and the 100-day SMA has played a crucial role as a support level during the subsequent decline. The recent price action has seen gold testing both the 50-day and 100-day SMAs, with the 100 SMA acting as a reliable support level. However, the market experienced a bearish reversal on Friday due to US dollar buying pressure, and despite the bounce on Monday, the upward momentum did not continue. Gold has once again returned to test the 100-day SMA.

XAU/USD – Daily chart H4

EUR/USD Pushing Above the 100 SMA

In May, EUR/USD transitioned into a bearish trend as USD buyers started to emerge. As a result, the pair reached its lowest point around 1.06 yesterday. On the price chart, the 20-period Simple Moving Average (gray) and the 50 SMA (yellow) have been acting as resistance levels. Traders have been taking advantage of price retracements to sell at these levels. However, last Thursday, a bullish reversal occurred, pushing the pair above the 50 SMA. Now the 100 SMA (green) has been broken too, so buyer are in charge.

EUR/USD – 240 minute chart

Cryptocurrency Update

BITCOIN Finding Resistance at the 50 SMA

Bitcoin has been bearish since April, making lower lows after being bullish during Q1, although the main trend is still bullish. BTC slipped to the 100-period SMA once again which held as support for several times, but finally broke on Monday after SEC filed charges against Binance. On Tuesday though we saw a reversal higher and a return above the 100 SMA so our “buy” signal for Bitcoin at the 100-period SMA still remains open. But buyers couldn’t push the price above the 50 SMA.

BTC/USD – Daily chart

The 100 SMA Holding for ETHEREUM

In recent weeks, the buying pressure for Ethereum has slowed down, and we have witnessed a retreat in its price over the last few days. However, the correction appears complete as the 100 SMA (green) held as support for ETH/USD and buyers pushed the price above the 50 SMA as well. Now it seems that this moving average has turned into support.