Forex Signals Brief April 23: Will Services and Mfg. Show Global Improvement?

Yesterday saw a relatively quiet news cycle ahead of an eventful week filled with PMI and earnings reports, as well as other important economic data releases. The Federal Reserve’s blackout period further reduced market chatter. As a result, the volatility was reduced, particularly in currency markets.

Both the euro and pound traded in a range, with EUR/USD hovering around dropping to 1.0650s and GBP/USD at 1.2350. This initially weighed on stock markets, causing them to retreat after an initial upward movement. However, after seven consecutive days of declines, bullish sentiment eventually prevailed, leading to a rebound in stock prices and a bullish close for the day.

However, there was quite some action in the Gold and Silver market, which experienced notable declines, while commodity currencies performed relatively better. The reduction in geopolitical tensions contributed to oil price volatility, but ultimately, oil prices stabilized.

Today’s Market Expectations

Today is all about the Manufacturing and Services PMI figures Here are the anticipated Flash PMI figures across major economies, with a focus on the US in light of the recent shift in the Fed’s stance:

• Eurozone Manufacturing PMI: Expected at 46.5, compared to 46.1 previously.
• Eurozone Services PMI: Expected at 51.8, versus 51.5 previously.
• UK Manufacturing PMI: Projected at 50.2, slightly lower than the previous 50.3.
• UK Services PMI: Anticipated at 53.0, a marginal decline from the prior 53.1.

For the US figures:

• US Manufacturing PMI: Estimated at 50.2, down from the prior reading of 50.7.
• US Services PMI: Expected to be 52.0, compared to the previous 52.5.

These figures will provide insight into the economic activity and sentiment across various sectors in these economies, with particular attention paid to the US given recent developments in monetary policy.

Yesterday the economic and forex events were minimal, so there was not much do drive markets. As a result, the volatility was low and we had only two closed forex signals, both winning trades, while we opened four trading signals in total, which continue to remain open today.

Gold Tumbles Below 3 MAs

Gold experienced significant price volatility yesterday The precious metal failed to surpass its pivot point of $2,400 yesterday, signaling pessimism in the market. The price underwent a major retreat, plummeting more than $100 to fall below $2,300. This considerable volatility underscores the uncertainty and fluctuation present in the gold market at this time.

XAU/USD – 240 minute chart

AUD/USD Takes Out the First Resistance

The AUD/USD exchange rate has experienced a decline of 3 cents over the past two weeks, with AUD/USD falling to the 0.6360s. However, yesterday witnessed a reversal higher, with an attempt to break above the previous support level at 0.6450s, which is now acting as resistance. Prior to the release of the manufacturing and services PMI data, the news was positive, with February’s numbers being revised higher.

USD/CHF – 240 minute Chart

Cryptocurrency Update

Bitcoin Faces the 50 SMA

Bitcoin’s price has lately plummeted below $60,000, marking its lowest point since the beginning of March. The cryptocurrency is currently trading around $61,200, approaching its lowest position in almost a month, when it was about $59,300. If this level is breached, the next lower target was expected but this support zone held and BTC bounced above $65,000 again.

BTC/USD – Daily chart

The 100 SMA Holds for Ethereum

Ethereum also retreated lower, falling below $3,000 last week, [iercing the 100 SMA (green) on the daily chart as well. But the price climbed back up and reversed above the $3,000 level. Yesterdwy buyers pushed even higher the climb stopped right at the 20 SMA (gray) so let’s see if they will push above it today.

ETH/USD – Daily chart