Forex Signals Brief November 8: FED’s Powell and BOE’s Bailey to Speak Today

Yesterday markets were relatively stable, with the USD starting to recover after the decline following FED’s meeting last week and the release of US employment data. Although FED member Cook expressed worry about property prices, stating that both residential and commercial property values are now high beyond historical levels associated with economic fundamentals.

The US dollar was the strongest of the major currencies while the NZD was the weakest. The dollar climbed, while Gold fell around $16.50 lower, or -1%. Stock markets declined in the European session while US indices remained in a tight range after opening with a bullish gap higher. Bond yields continued the climb after they reversed higher late on Friday, following the decline post data.

Today’s Market Expectations

Today the economic calendar is almost empty, but we have two speeches from central bankers. BOE Governor Andrew Bailey Speaks will speak at the Central Bank of Ireland Financial System Conference, in Dublin, although not much is expected from him. The FED president will give the opening remarks at the Division of Research and Statistics Centennial Conference, in Washington DC and traders will be interested to hear if he will hint at another rate hike in December.

The Bank of Canada meeting minutes will also be released today. They kept rates steady at 5.00% and reiterated their willingness to raise rates further if necessary, recognizing that inflationary concerns have grown. Inflation expectations were raised in the MPR, while growth projections for 2023 and 2024 were reduced, although 2025 was updated slightly higher. The BOC now anticipates inflation to return to target by the end of 2025 (up from mid-2025 in its July MPR). Governor Macklem and Deputy Governor Rogers both pushed back on the concept of rate decreases anytime soon at their post-meeting press conferences.

Yesterday the volatility resumed again and we saw a 100 pip move across most major currencies. The USD continued to recuperate last week’s losses which followed the soft economic data from the US. We opened six trading signals, although four reached the take profit or stop loss targets, with two closing in loss while the other two closed in profit.

 GOLD Starting to Reverse Higher After the Doji

Gold has been making gains since early October as the sentiment turned negative and safe havens such as XAU and the CHF gained from the Gaza crisis. Gold broke through $2,000, with moving averages acting as excellent support indicators. However, the price has retreated as the Middle Eastern instability has not expanded any further. The price fell to $1957 but formed a doji candlestick on the H4 chart which is a bullish reversing signal and we decided to open a buy Gold signal, which closed in profit.

XAU/USD – 240 minute chart

• Gold Buy Signal
• Entry Price: $1,962.09
• Stop Loss: $1,948.09
• Take Profit: $1,970.09

Holding on to USD/JPY Longs 

The USD/JPY has been fairly volatile recently. It dipped after the Bank of Japan suggested changing policy, but rebounded after the BOJ failed to wow investors with a decisive move last week. The price then plummeted when the Federal Reserve followed suit. Despite the fact that it is presently reversing and exceeding 150. We opened a buy signal here last week and continue to hold as buyers have resumed control.

USD/JPY – Daily chart

Cryptocurrency Update

BITCOIN Retests October’s High

Bitcoin has also benefited from improved sentiment, notably in the cryptocurrency industry since the SEC approved a Bitcoin spot ETF. For this reason, this cryptocurrency soared upward late last month, pushing beyond $35,000 but failing to hold gains and turning downward. Despite not losing much ground, buyers seized control, sending the price close to $36,000. BTC is now stabilizing around $35,000 in value but yesterday we saw another bounce off the 50 SMA although buyers stopped at last month’s high just below $36,000.

BTC/USD – 240 minute chart

ETHEREUM Remains Close to $1,900

After the SEC approved Bitcoin spot ETFs last month, Ethereum benefited from the good attitude in the crypto market and soared beyond $1,800, gaining more than $300. The zone around $1,700 became support, and it now seems that the 50 SMA (yellow) has also become support, which is fantastic. ETH/USD reached a high of $1,900 over the weekend, indicating that the price is approaching our objective.

Ethereum – 240 minute Chart

• ETH Buy Signal
• Entry Price: $1,671.79
• Stop Loss: $1,371
• Take Profit: $1,971