#WaveAnalysis
#EURAUD reversed from resistance level 1.6235
• Likely to fall to support level 1.5880
EURAUD recently reversed down from the major resistance level 1.6235 (which has been reversing the price from the middle of 2021, as can be seen below)
The resistance level 1.6235 was strengthened by the upper weekly and the daily Bollinger Band.
Given the overbought weekly Stochastic indicator, EURAUD can then be expected to fall toward the next support level 1.5880 (former resistance from the end of 2022).
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#EURAUD reversed from resistance level 1.6235
• Likely to fall to support level 1.5880
EURAUD recently reversed down from the major resistance level 1.6235 (which has been reversing the price from the middle of 2021, as can be seen below)
The resistance level 1.6235 was strengthened by the upper weekly and the daily Bollinger Band.
Given the overbought weekly Stochastic indicator, EURAUD can then be expected to fall toward the next support level 1.5880 (former resistance from the end of 2022).
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Over the weekend, OPEC+ unexpectedly announced a production cut of 1.16 million bpd. Separately, Russia extended its voluntary cut by 0.5 million barrels from March to the end of the year.
The unexpected decision caused oil to jump at the week's opening, bringing the price back to the upper end of the trading range it had been in since December before breaking through its lower boundary.
The cartel presents the decision as an attempt to balance supply and demand in the market. And this is an interesting passage, given that the developed economies are actually performing noticeably better than expected of them a couple of quarters ago. The US has not increased production, and OPEC+ has changed its original plan to restore production.
It is more accurate to call the latest decision an attempt to support the price, which briefly moved below the $65/bbl WTI level last month, with Brent testing support at $70.
The unexpected decision caused oil to jump at the week's opening, bringing the price back to the upper end of the trading range it had been in since December before breaking through its lower boundary.
The cartel presents the decision as an attempt to balance supply and demand in the market. And this is an interesting passage, given that the developed economies are actually performing noticeably better than expected of them a couple of quarters ago. The US has not increased production, and OPEC+ has changed its original plan to restore production.
It is more accurate to call the latest decision an attempt to support the price, which briefly moved below the $65/bbl WTI level last month, with Brent testing support at $70.
Looking at the price dynamics from the side of tech analysis, it is worth being cautious about further purchases. The price stabilised at the upper boundary of the trading range, approaching the overbought area on the RSI on the daily charts. The 200-day moving average (now $83.58) also points into the same area. One dollar lower is the reversal area for oil from December.
Short-term selling strength should be expected in the $82.50-83.5 area. If that happens, you should be prepared for oil to close the gap at the start of this week.
In our view, traders should be prepared for the US trying to put pressure back on oil quotations, as it is an important tool to keep inflation and inflation expectations in check.
Nevertheless, a quicker development cannot be ruled out with another short squeeze in oil and a capitulation of the bears. After the price consolidates at the 200-day average, this scenario is worth considering, which would open a direct path to the $85-90 area.
Short-term selling strength should be expected in the $82.50-83.5 area. If that happens, you should be prepared for oil to close the gap at the start of this week.
In our view, traders should be prepared for the US trying to put pressure back on oil quotations, as it is an important tool to keep inflation and inflation expectations in check.
Nevertheless, a quicker development cannot be ruled out with another short squeeze in oil and a capitulation of the bears. After the price consolidates at the 200-day average, this scenario is worth considering, which would open a direct path to the $85-90 area.
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#WaveAnalysis
#GBPUSD under the bullish pressure
• Likely to rise to resistance level 1.2600
GBPUSD under the bullish pressure after the price broke the key resistance level 1.2440 (which has been reversing the price from the middle of 2022, as can be seen below).
The breakout of the resistance level 1.2440 accelerated the C-wave of the active ABC correction (2).
Given the strongly bullish sterling sentiment sent today, GBPUSD can then be expected to rise further toward the next resistance level 1.2600 (target for the completion of the active wave C).
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#GBPUSD under the bullish pressure
• Likely to rise to resistance level 1.2600
GBPUSD under the bullish pressure after the price broke the key resistance level 1.2440 (which has been reversing the price from the middle of 2022, as can be seen below).
The breakout of the resistance level 1.2440 accelerated the C-wave of the active ABC correction (2).
Given the strongly bullish sterling sentiment sent today, GBPUSD can then be expected to rise further toward the next resistance level 1.2600 (target for the completion of the active wave C).
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#WaveAnalysis
#Nasdaq100 broke resistance area
• Likely to rise to resistance level 13400.00
Nasdaq100 index recently broke the resistance area located between the resistance levels 12885.00 (which has been reversing the price from the start of February) and 13160.00
The breakout of this resistance area accelerated the active impulse wave 3 of the intermediate impulse wave (C) from last month.
Given the clear daily uptrend, Nasdaq-100 index can then be expected to rise further toward the next resistance level 13400.00 (target price for the completion of the active impulse wave 3).
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#Nasdaq100 broke resistance area
• Likely to rise to resistance level 13400.00
Nasdaq100 index recently broke the resistance area located between the resistance levels 12885.00 (which has been reversing the price from the start of February) and 13160.00
The breakout of this resistance area accelerated the active impulse wave 3 of the intermediate impulse wave (C) from last month.
Given the clear daily uptrend, Nasdaq-100 index can then be expected to rise further toward the next resistance level 13400.00 (target price for the completion of the active impulse wave 3).
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The cryptocurrency market has gained over 3% in the last 24 hours, reaching $1.21 trillion. Interestingly, #Bitcoin has not kept pace with the overall growth, adding 2.3% to $28.55K over the same period. #Ethereum, on the other hand, has risen by 5.5% to $1910.
The first cryptocurrency is stuck in local highs, above which it has been unable to consolidate since 19th March. This prolonged consolidation sets the stage for the next big move. The resolution of this consolidation is likely to be linked to the market's reaction to Friday's Non-Farm Payrolls. Technically, a pullback to the $27k level to correct the rally of the 10th of March is likely.
A more bullish scenario is offered by Ethereum, which broke through resistance in a sharp move yesterday and continues to gain traction, reaching an 8-month high. The dynamics within the Fibonacci theory suggest that a target near $2150 could be considered.
The first cryptocurrency is stuck in local highs, above which it has been unable to consolidate since 19th March. This prolonged consolidation sets the stage for the next big move. The resolution of this consolidation is likely to be linked to the market's reaction to Friday's Non-Farm Payrolls. Technically, a pullback to the $27k level to correct the rally of the 10th of March is likely.
A more bullish scenario is offered by Ethereum, which broke through resistance in a sharp move yesterday and continues to gain traction, reaching an 8-month high. The dynamics within the Fibonacci theory suggest that a target near $2150 could be considered.
Rate surprise from New Zealand
The Reserve Bank of New Zealand made another rate hike of 50 points to 5.25%. Contrary to forecasts of a 25-point rate hike and the global trend towards a slowdown in policy tightening, the RBNZ has not slowed down a step. In this cycle, the rate has already been increased by 500 points.
A higher-than-expected rate hike caused the NZDUSD to rise 1.2% within a minute to 0.6378. However, a few minutes later, the excitement for the New Zealand currency eased, and the pair almost erased this rise, returning to the 0.6310 level at the start of the day.
In our view, the pressure on the NZD was due to hints that this could be the end of the RBNZ's hike cycle, suggesting a slowdown in domestic demand and normalisation of domestic price pressures as the weather in the north of the country normalises.
The Reserve Bank of New Zealand made another rate hike of 50 points to 5.25%. Contrary to forecasts of a 25-point rate hike and the global trend towards a slowdown in policy tightening, the RBNZ has not slowed down a step. In this cycle, the rate has already been increased by 500 points.
A higher-than-expected rate hike caused the NZDUSD to rise 1.2% within a minute to 0.6378. However, a few minutes later, the excitement for the New Zealand currency eased, and the pair almost erased this rise, returning to the 0.6310 level at the start of the day.
In our view, the pressure on the NZD was due to hints that this could be the end of the RBNZ's hike cycle, suggesting a slowdown in domestic demand and normalisation of domestic price pressures as the weather in the north of the country normalises.
The #NZDUSD has maintained an upward trend for almost a month, receiving support from increasingly higher levels. We consider the smooth reversal to the upside in the pair in March from the 200-day average line as a milestone. On Monday, the Kiwi crossed above its 50-day average, which is also a signal that Today's intraday trend shows that the bulls cannot increase the momentum of this trend.
Despite a strong sell-off shortly after the rate decision, the NZDUSD doesn't look overbought, and there are no significant resistance levels until the area of 0.6500.
And the Kiwi might continue. The pair had an almost canonical Fibonacci retracement from the October-January rise in February and early March and has been moving gently upwards since then, with the potential to reach 0.70-0.71 before the end of the year.
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Despite a strong sell-off shortly after the rate decision, the NZDUSD doesn't look overbought, and there are no significant resistance levels until the area of 0.6500.
And the Kiwi might continue. The pair had an almost canonical Fibonacci retracement from the October-January rise in February and early March and has been moving gently upwards since then, with the potential to reach 0.70-0.71 before the end of the year.
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💰 On this day 90 years ago, April 5th, 1933: Franklin D. Roosevelt signed Executive Order 6102 in response to the worsening depression, banning US citizens from hoarding gold in any form. People had until May 1st to turn in excess gold to the Fed at $20.67 per oz. ⚠️ Failure to comply could result in a fine of up to $10k or ten years imprisonment, or both!
🎉 Today, April 5th, is also believed to be the birthday of Satoshi Nakamoto, the mysterious creator of Bitcoin. 🎂🎁
🎉 Today, April 5th, is also believed to be the birthday of Satoshi Nakamoto, the mysterious creator of Bitcoin. 🎂🎁
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#WaveAnalysis
#EURUSD under the bearish pressure
• Likely to fall to support level 1.0800
EURUSD under the bearish pressure after the price reversed down from the key resistance area located between the long-term resistance level 1.0950 (which has been reversing the price from the end of April) and the upper daily Bollinger Band.
The price is likely to form the daily Bearish Engulfing – if the pair closes today near the current levels.
Given the overbought daily Stochastic, EURUSD can then be expected to fall further toward the next support level 1.0800 (low of the pervious correction B).
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#EURUSD under the bearish pressure
• Likely to fall to support level 1.0800
EURUSD under the bearish pressure after the price reversed down from the key resistance area located between the long-term resistance level 1.0950 (which has been reversing the price from the end of April) and the upper daily Bollinger Band.
The price is likely to form the daily Bearish Engulfing – if the pair closes today near the current levels.
Given the overbought daily Stochastic, EURUSD can then be expected to fall further toward the next support level 1.0800 (low of the pervious correction B).
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#WaveAnalysis
#EURJPY reversed from key resistance level 145.40
• Likely to fall to support level 142.00
EURJPY recently reversed down from the key resistance level 145.40 (which has been reversing the price from the start of March) intersecting with the upper daily Bollinger Band.
The downward reversal from the resistance level 145.40 created the daily Japanese candlesticks reversal pattern Shooting Star Doji.
Given the strong yen sentiment, EURJPY can then be expected to fall further toward the next support level 142.00.
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#EURJPY reversed from key resistance level 145.40
• Likely to fall to support level 142.00
EURJPY recently reversed down from the key resistance level 145.40 (which has been reversing the price from the start of March) intersecting with the upper daily Bollinger Band.
The downward reversal from the resistance level 145.40 created the daily Japanese candlesticks reversal pattern Shooting Star Doji.
Given the strong yen sentiment, EURJPY can then be expected to fall further toward the next support level 142.00.
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The crypto market lost 1.4% overnight to $1.19 trillion. Bitcoin, down 1.6% at $28K, once again underperformed the market. Ethereum fell just over 1% to $1890. This Bitcoin dynamic can be attributed to its outperformance in the March episode of capital flight from banks. That money is now neatly parked elsewhere while Bitcoin is "resting".
Bitcoin's recent pullback has confirmed that the trading range of the past two weeks remains in place. The first cryptocurrency does not see any significant obstacles on the way down to levels near $27K. The deepening drawdown could be influenced by negative sentiment in traditional financial markets.
MicroStrategy additionally bought 1,045 bitcoins for approximately $29.3 million at an average price of $28,016 per BTC. And now owns 140K BTCs at an average price of $29,803.
According to Kaiko, the correlation index between bitcoin and gold has reached 50%. Meanwhile, BTC's dependence on the US stock market has fallen to 20%.
Bitcoin's recent pullback has confirmed that the trading range of the past two weeks remains in place. The first cryptocurrency does not see any significant obstacles on the way down to levels near $27K. The deepening drawdown could be influenced by negative sentiment in traditional financial markets.
MicroStrategy additionally bought 1,045 bitcoins for approximately $29.3 million at an average price of $28,016 per BTC. And now owns 140K BTCs at an average price of $29,803.
According to Kaiko, the correlation index between bitcoin and gold has reached 50%. Meanwhile, BTC's dependence on the US stock market has fallen to 20%.
This week's PMI business activity figures were much weaker than expected, reflecting the impact of the sharpest monetary tightening in more than 40 years on the economy.
The ISM's service sector data attracts the most interest from market participants as it represents the broadest sector of the economy. The index fell from 55.1 to 51.2 in March, against expectations for a drop to 54.3. Readings above 50 reflect an overall activity increase, but the pace of expansion has slowed sharply after a rise in January and February.
The index was dragged by a sharp fall in new orders: The export orders component fell by 18 points, while the New Orders component lost 10.4 points.
Only the inventories component rose, but this is a questionable positive as it could reflect overstocking in the face of falling demand. And this hypothesis is supported by a sharp fall in new orders.
Ahead of the NFP, we also look at the employment component, which at 51.3, is also scrambling for growth territory.
The ISM's service sector data attracts the most interest from market participants as it represents the broadest sector of the economy. The index fell from 55.1 to 51.2 in March, against expectations for a drop to 54.3. Readings above 50 reflect an overall activity increase, but the pace of expansion has slowed sharply after a rise in January and February.
The index was dragged by a sharp fall in new orders: The export orders component fell by 18 points, while the New Orders component lost 10.4 points.
Only the inventories component rose, but this is a questionable positive as it could reflect overstocking in the face of falling demand. And this hypothesis is supported by a sharp fall in new orders.
Ahead of the NFP, we also look at the employment component, which at 51.3, is also scrambling for growth territory.
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The ISM manufacturing index published earlier in the week painted an even more dramatic picture, falling to a near three-year low of 46.3, with the employment component deepening further into contraction territory.
Both indices were much weaker than expected, as were the S&P Global PMI estimates. Such data does not provide a positive signal ahead of Friday's NFP.
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Both indices were much weaker than expected, as were the S&P Global PMI estimates. Such data does not provide a positive signal ahead of Friday's NFP.
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The crypto market lost 0.5% in 24 hours, bouncing back to $1.18 trillion. This level has become the centre of gravity around which the market has been moving all week. So far, it looks like a pause and consolidation but not a breakout.
Bitcoin has fared better this time around, losing 0.4% and remaining stuck at $28K for the past three weeks. Notably, there has been no deep correction or noticeable upward bias during this time. Bitcoin's rally has stalled in the area that provided meaningful support in May and early June last year. An upside move would be a significant milestone to restore long-term investor confidence.
On the other hand, a deeper drawdown below $27.0K or even to $25.5K may be required before a move higher, which would fully correct the rise from the early March lows and clear the way to the upside.
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Bitcoin has fared better this time around, losing 0.4% and remaining stuck at $28K for the past three weeks. Notably, there has been no deep correction or noticeable upward bias during this time. Bitcoin's rally has stalled in the area that provided meaningful support in May and early June last year. An upside move would be a significant milestone to restore long-term investor confidence.
On the other hand, a deeper drawdown below $27.0K or even to $25.5K may be required before a move higher, which would fully correct the rise from the early March lows and clear the way to the upside.
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🐣Easter Market Holidays: Changes to Trading Schedule
With the US and EU observe this festive time, please be aware of potential impacts on your trading activities, as several markets are closed today and Monday. 🐰🌼
👉Check the full schedule
Wishing you all a happy and prosperous Easter season from the FxPro team! 🎉
With the US and EU observe this festive time, please be aware of potential impacts on your trading activities, as several markets are closed today and Monday. 🐰🌼
👉Check the full schedule
Wishing you all a happy and prosperous Easter season from the FxPro team! 🎉
Indicators point to a weak NFP
One of the most timely and unpredictable economic reports, the US Nonfarm Payrolls report for March, will be released on Friday. Market participants will look to other publications to shed light on the situation.
The average forecast among market participants is for the economy to have created 230K jobs in March, down from 311K the previous month. However, these forecasts were made about a week ago, and the data that has come in since then suggests that the actual number will be much weaker.
The change in ADP private sector employment, the closest indicator to the headline NFP figure, missed expectations, showing a gain of 145K after 261K the previous month versus expectations of 208K and an official reading of 443K.
One of the most timely and unpredictable economic reports, the US Nonfarm Payrolls report for March, will be released on Friday. Market participants will look to other publications to shed light on the situation.
The average forecast among market participants is for the economy to have created 230K jobs in March, down from 311K the previous month. However, these forecasts were made about a week ago, and the data that has come in since then suggests that the actual number will be much weaker.
The change in ADP private sector employment, the closest indicator to the headline NFP figure, missed expectations, showing a gain of 145K after 261K the previous month versus expectations of 208K and an official reading of 443K.
Weekly jobless claims fell from 246K to 228K last week but remained in an uptrend since late January from a low of 194K. Initial claims have been on an uptrend since September and have increased by 42K in the last four weeks.
At the same time, according to estimates by Challenger, Gray & Christmas, there continues to be an impressive year-on-year increase in planned redundancies.
Companies reported plans to cut 89.7K jobs, 3.2 times higher than a year ago and 15% higher than last month. Again, it's hard to see signs of sustained strength in the labour market.
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At the same time, according to estimates by Challenger, Gray & Christmas, there continues to be an impressive year-on-year increase in planned redundancies.
Companies reported plans to cut 89.7K jobs, 3.2 times higher than a year ago and 15% higher than last month. Again, it's hard to see signs of sustained strength in the labour market.
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