Forex Signals Brief June 13: US Inflation Diverging Further

Today the headline US CPI inflation is expected to show another slowdown, but core inflation is expected to tick higher

Skerdian Meta•Tuesday, June 13, 2023•3 min read

Lower core PCE inflation helping stock markets

Yesterday’s Market Wrap

Yesterday the economic calendar was light, with only the Japanese producer inflation PPI, which slowed down to 5.1%. There was some price action nonetheless, with the USD finding some bids ahead of tomorrow’s FOMC meeting, which is expected to produce no more rate hikes, but markets are fearing a surprise hike just like the RBA and the BOC did last week since the data hasn’t been too bad.

The GBP was the weakest currency yesterday as GBP/USD fell more than 100 pips. On the commodities sector, crude Oil continued last Friday’s slide and fell below $67, while Gold tumbled more than $15, ending up below $1,950, before retracing some of the losses toward the end of the day.

Today’s Market Expectations

Today we have the unemployment report from the UK, with earnings expected to increase and the unemployment rate to tick higher. The German ZEW Economic Sentiment is expected to show a further deterioration when it will be released soon, although the most important economic event today will be the release of the US CPI consumer inflation report. The headline inflation is expected to show a slowdown to 4.1% on an annualized basis, but core inflation is expected to tick higher, which will give mixed signals to the FED.

Forex Signals Update

Yesterday the price action was slow in most assets, so we only had two closing signals. One of them was a short term sell EUR/USD signal after the bearish reversal in this pair, the other one was the long term sell Gold signal, which closed after XAU/USD tumbled below $1,950.

GOLD Feeling Weak Again

In early May, the price of gold turned bearish and fell below the Moving Averages, which seem to have turned into resistance now. The 200 SMA (purple) stopped the climb last week and after some buying on Friday, yesterday sellers returned and triggered our sell signal here.

XAU/USD – H4 chart

Is EUR/USD Reversing Higher?

EUR/USD turned bearish in early May as USD buyers became more active. As a result, the pair reached its lowest point around 1.06 at the end of last month, with moving averages pushing it down, particularly the smaller ones. But, we have seen some buying momentum since last week and the price has increased above most moving averages which are turning into support now.

EUR/USD – 240 minute chart

Cryptocurrency Update

BITCOIN Still Feeling Heavy

Bitcoin has experienced a bearish phase for the past two months, with prices making lower lows after a bullish period in the first quarter. However, the overall trend for Bitcoin remains bullish. The cryptocurrency slipped to the 100-period Simple Moving Average (SMA) multiple times, and this level had been acting as a reliable support. However, on Monday, the support of the 100 SMA was finally broken following the Securities and Exchange Commission (SEC) filing charges against Binance. On Tuesday, we observed a reversal in Bitcoin’s price, pushing it higher and reclaiming a position above the 100 SMA. As a result, our “buy” signal for Bitcoin at the 100-period SMA remains valid. However, buyers have struggled to push the price above the 50 SMA, which has acted as a resistance level. It suggests that there might still be some hesitation or selling pressure in the market.

BTC/USD – Daily chart

The 100 SMA Breaks in ETHEREUM

In recent weeks, the selling pressure for Ethereum has increased, resulting in a decline in its price over the past few days. It appears that the correction reached its completion point, as the 100-period Simple Moving Average (SMA) represented by the green line was holding as support for ETH/USD, but it was broken on Saturday and now sellers seem in control.

ETH/USD – Daily chart

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ABOUT THE AUTHOR See More

Skerdian Meta

Lead Analyst

Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.