Forex Signals Brief October 3: RBA Policy Meeting and JOLTS Jobs Highlight the Day
Yesterday’s Market Wrap
This was the last week of September and of Q2, with the quarter concluding on a strong note, with the USD continuing to make gains despite some mixed numbers. The Euro and the Pound were the biggest losers last week as the economic data remained soft, with the Eurozone CPI consumer inflation coming at 4.2%, below expectations of 4.5% and down from 5.3% in the previous month.
Commodity dollars held up well as the situation in China seems to be a bit better. However, we saw a surge in USD/CAD as the CAD tumbled lower, following the $5 bearish reversal in crude Oil, which closed the week closer to $80 from above $85.
Treasury rates rose once again which weighed on equity markets, as they closed another week down. We saw some fluctuations during the week though, but the reasons for the changes were more about quarter-end flows than fundamentals, since the PCE inflation readings were somewhat modest and Williams was dovish.
Gold remained hammered throughout the week and fell below $1,900, now heading for this year’s lows after falling to its lowest level since mid-March. The US was mostly strong although it retreated on Thursday ahead of the PCE price index report, which came in softer than expected, but markets brushed it off after the strong jobs report. This concludes trade for the week, month, and quarter.
Today’s Market Expectations
Today started with the Reserve Babk of Australia rate meeting, which was widely expected to maintain the cash rate at 4.10%. The RBA predicted that headline inflation will rise in Q3 owing to increasing energy costs and warned that the labor market might be approaching a tipping point. Indeed, the recent labor market data was underwhelming, with the majority of new positions being part-time, and the latest monthly CPI showing a rise in headline inflation while the Core measure fell. So no more hikes from them, which should keep the AUD soft.
The other important event of the day is the JOLTS job openeing which have been soft in recent readings. the significant miss in the previous month produced some noticeable changes in the markets owing to the focus on labor market statistics, therefore US Job Openings will be one of the top announcements this week. The consensus predicts that job openings will be 8.83 million in August, up from 8.827 million in July.
Forex Signals Update
Last week the USD started it strong. rallying in the first few days before retracing lower by the middle of the week. But it ended the week up eventually. We remained long on the USD and opened 20 trading signals, closing it with 16 winning forex signals and 4 losing ones, giving us an 80-20% win/loss ratio.
GOLD Falling Below $1,930
Gold continiues to show no signs of life as it keeps making massive losses day after day. The chart shows strong bearish momentum in XAU/USD. Gold broke below the 200 SMA (purple), which rejected the price twice in about a month and has already seen two bounces off of it, but the price has continued to return to it, signaling that the 200 SMA has now been broken. As the slump persisted, the price fell below $1,960 yesterday.
XAU/USD – Daily chart
- Gold Sell Signal
- Entry Price: $1,850
- Stop Loss: $1,875
- Take Profit: $1,820
EUR/USD Falling Below 1.05
EUR/USD has been bearish since July and it seems like the decline is picking up momentum, as this pair continues to make new lows. Late last week we saw a reverse higher above 1.06, but the 50 SMA (yellow) acted as resistance, refusing the price and yesterday we saw a 100 pips tumble as USD buyers returned, sending this pair below 1.05.
EUR/USD – 240 minute chart
- EUR/USD Sell Signal
- Entry Price: 1.0550
- Stop Loss: 1.06
- Take Profit: 1.0480
Cryptocurrency Update
Booking Profit During the Surge in BITCOIN
On Sunday, we saw another rebound in the cryptomarket, as the digital coins market has been in a mood swing over the previous few weeks, with Bitocin making a nice recovery after plummeting below $25,000 in September. Buyers failed to break over the 200 SMA, and we observed a bearish candlestick yesterday following a doji last, which is a bearish reversal indication. The price had been falling for a week, but inn the last two days there was a strong rally that brought it to $28,555. Although the 200 SMA (purple) acted as resistance again, rejecting the price initially, so let’s see if buyers will be able to push above this MA.
BTC/USD – Daily chart
- BTC Buy Signal
- Entry Price: $26,248.2
- Stop Loss: $24,500
- Take Profit: $28,000
ETHEREUM Fwiling at the 100 SMA
Lte last month, the price of Ethereum started increasing from the support, showing that there was a degree of purchasing interest and demand for Ethereum at roughly $1,600. Buyers have entered the region above this level on multiple times, but the 100 SMA (green) has been functioning as resistance on the daily chart. After Subnday’s surge we saw a reversal at thismomving average and yesterday erased all of Sundy’s gains.
ETH/USD – Daily chart
- ETH Buy Signal
- Entry Price: $1,671.79
- Stop Loss: $1,371
- Take Profit: $1,971
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