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Forex Signals Brief September 4: Will USD Resume the Uptrend This Week?

Posted Monday, September 4, 2023 by
Skerdian Meta • 4 min read

Last Week’s Market Wrap

Last week we came after the Jackson Hole Symposium where FED’s Jerome Powell repeated that the FED policy will depend on the economic data. So, the attention was on the economic numbers. mainly the jobs figures from the US which had reserved a negative surprise, although manufacturing also received attention, which offered a positive surprise.

The JOLTS Job Openings declined below 9 million with downward revisions for the previous month, while the ADP Non-Farm Employment Change which has continually beat expectations, missed them this time and came below half of the previous month. The Unemployment Claims beat expectations on Thursday but not by much, similar to the Non-Farm Employment NFP on Friday, but the unemployment rate jumped by 3 points to 3.8% in the US. This shows a slowing trend in the US employment sector, which weighed on the US Dollar, keeping it bearish for most of the week.

Although, it did make a reversal late on Friday after the improvement in the PMI manufacturing indicator in August. This comes after the increase in the Chinese manufacturing PMI indicator to 49.7 points in August from 49.3 in July, beating expectations of another slowdown to 49.1 points on Thursday, while earlier that day Caixin Manufacturing PMI jumped to 51.0 points, showing that this sector might have left contraction behind. This might have helped improve the sentiment in the markets as risk assets ended the week with gains.

This Week’s Market Expectations

This week the economic calendar is lighter, although volatility is still expected. Today the US and Canada are off for Labour Day although we have the Swiss GDP report for Q2 which is expected to show a slowdown to 0.1% from 0.3% previously. Caixin Services PMI is expected to show a slight slowdown on Tuesday morning but remain well in expansion, while the Reserve Bank of Australia is expected to keep interest rates unchanged at 4.10%, despite an increase in the GDP by 0.3% in Q2 against 0.2% in Q1.

The ISM Services PMI indicator is expected to be little changed on Wednesday as are the US Unemployment Claims, while we also have the Bank of Canada meeting, which is expected to keep rates unchanged too, at 5.00%. The Canadian employment report is expected to close the week, with an increase to 5.6%.

Forex Signals Update

This week was characterized by weakness in the US dollar, which in the end tried to close the week on the right foot after the reversal on Friday afternoon. Although, we saw quite a few reversals, as the sentiment kept flipping. We opened 18 trading signals in total, closing the week with 5 losing signals and the rest reached the take profit target, giving us a 78/28% win/loss ratio.

Is the Rally in GOLD Over?

In the last two weeks Gold has experienced a reversal, moving higher after briefly dropping below $1,900. This shift in direction was influenced by a weakening labour market in the U.S. The change in market sentiment led to a bullish outlook, with buyers returning to the market and pushing the Gold price to $1,953 by Friday afternoon. But, buyers ran into the 100 daily SMA (green) which acted as resistance and now Gold is overbought on the daily chart, with three doji candlesticks at the top, which are bearish reversing signals.

XAU/USD – Daily chart

Sell Gold Signal
Entry Price: $1,950
Stop Loss: $1,960
Take Profit: $1,930

Booking Profit on GBP/AUD

GBP/AUD has turned bearish since the middle of August, making lower highs as the market turns bearish on the GBP, with expectations of a less hawkish Bank of England after one more hike. The 50 SMA (yellow) has turned into resistance and we decided to open a sell forex signal below that moving average last week, which closed in p rofit as sellers sent the price down to the 200 SMA (purple).

GBP/AUD – 240 minute chart

Cryptocurrency Update

BITCOIN Falling Below $26,000

The crypto market has been in a retreat since the middle of July, although after the Grayscale news, which recently won a lawsuit against the U.S. Securities and Exchange Commission (SEC) we saw a decent jump last week. The D.C. court ruled that the SEC improperly rejected the Bitcoin Spot Exchange-Traded Fund (ETF) proposed by Grayscale. As a result, the court ordered that the petition for review be granted, and the commission’s order be vacated.

This news had a notable impact on BTC’s price as it rallied $2,000 higher in response to the court’s decision. However, the rally was met with resistance at the 200-day SMA, which appears to be a critical level for the cryptocurrency. The price reversed there and it eventually fell below $26,000, giving back all the gains.

BTC/USD – Daily chart

We’ve decided to open another buy Bitcoin signal yesterday after the pullback, going in long just above the 100 MS Aon the H4 chart above.

BTC Buy Signal
Entry Price: $27,157.1
Stop Loss: $25,113
Take Profit: $29,113

ETHEREUM Fails at the 20 SMA

Ethereum has demonstrated a higher level of resilience when compared to Bitcoin. Although it was not unaffected by the recent crypto market crash and the ETH/USD pair dropped below $1,600, there’s a significant observation on the weekly chart. The 200-day Simple Moving Average (SMA), represented by the purple line, functioned as a support level during this tumultuous period.

Taking into account this observed support and Ethereum’s historical behavior, we have now taken a long position on Ethereum once again. It’s important to acknowledge that the cryptocurrency market can be exceptionally volatile. Conducting thorough research and prioritizing risk management are essential factors prior to making any trading decisions.