US inflation once again beat expectations. The DXY responded with a 1% rise to 104.80. The dollar recorded two peaks near these levels in February and late March, and it has not traded higher since November.
The Total and Core CPI each added 0.4% versus 0.3% expected. The year-over-year rate of CPI grew to 3.5%, while the Core index maintained its 3.8%. In both cases, the monthly rates of increase defy expectations of a return to the targeted 2%.
This should be troubling news on top of the strong employment report late last week. The data-linked Fed is unlikely to miss the data set of the past five days and is likely to maintain its wait-and-see stance.
Technically, the current upside momentum looks like an attempt to break away from support in the form of the 50 and 200-day moving average crossover and head higher after a prolonged consolidation. This movement may not meet any significant resistance until the 106.80-107 area, where the downward reversal was formed last October.
The Total and Core CPI each added 0.4% versus 0.3% expected. The year-over-year rate of CPI grew to 3.5%, while the Core index maintained its 3.8%. In both cases, the monthly rates of increase defy expectations of a return to the targeted 2%.
This should be troubling news on top of the strong employment report late last week. The data-linked Fed is unlikely to miss the data set of the past five days and is likely to maintain its wait-and-see stance.
Technically, the current upside momentum looks like an attempt to break away from support in the form of the 50 and 200-day moving average crossover and head higher after a prolonged consolidation. This movement may not meet any significant resistance until the 106.80-107 area, where the downward reversal was formed last October.
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#WaveAnalysis
#EURGBP reversed from resistance level 0.8585
Likely to fall to support level 0.8500
EURGBP currency pair recently reversed down from the pivotal resistance level 0.8585 (which has been reversing the price from February).
The resistance level 0.8585 was strengthened by the upper daily Bollinger Band and by the 38.2% Fibonacci correction of the downward impulse from December.
Given clear daily downtrend and the strongly bullish sterling sentiment, EURGBP currency pair can be expected to fall further to the next strong support level 0.8500 (which has been reversing the price from last July).
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#EURGBP reversed from resistance level 0.8585
Likely to fall to support level 0.8500
EURGBP currency pair recently reversed down from the pivotal resistance level 0.8585 (which has been reversing the price from February).
The resistance level 0.8585 was strengthened by the upper daily Bollinger Band and by the 38.2% Fibonacci correction of the downward impulse from December.
Given clear daily downtrend and the strongly bullish sterling sentiment, EURGBP currency pair can be expected to fall further to the next strong support level 0.8500 (which has been reversing the price from last July).
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The #crypto market continues to avoid gaining momentum on the upside but remains within an uptrend: the bulls fail to accelerate price gains, but the overall upward trend remains. ‘Extreme Greed’ persists in the markets, with the corresponding index at 79. In contrast, the sentiment in the stock markets is almost ‘Neutral’.
#Bitcoin maintains its uptrend, leaving a gap between the price and the 50-day moving average of around 3.5%. From the current $71K, the first cryptocurrency has little trouble rising to $72K, but it could enter a turbulent zone further down when it starts to struggle against strong resistance. On the bearish side, a rising dollar and a breakdown of the upward trend in stock indices.
#Toncoin (TON) hit an all-time high of $7.70 on Thursday, rising 40% over seven days on the back of multiple announcements from The Open Network and Telegram. The token surpassed Cardano by capitalisation and ranked 9th by CoinMarketCap.
#Bitcoin maintains its uptrend, leaving a gap between the price and the 50-day moving average of around 3.5%. From the current $71K, the first cryptocurrency has little trouble rising to $72K, but it could enter a turbulent zone further down when it starts to struggle against strong resistance. On the bearish side, a rising dollar and a breakdown of the upward trend in stock indices.
#Toncoin (TON) hit an all-time high of $7.70 on Thursday, rising 40% over seven days on the back of multiple announcements from The Open Network and Telegram. The token surpassed Cardano by capitalisation and ranked 9th by CoinMarketCap.
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#WaveAnalysis #T
AT&T broke key support level 16.60
Likely to fall to support level 16.20
AT&T under the bearish pressure after the price broke the key support level 16.60 (which has been reversing the price from January).
The breakout of the support level 16.60 coincided with the breakout of 38.2% Fibonacci correction of the sharp upward impulse from October.
Given the strength of the active downward impulse wave 3, AT&T can be expected to fall further to the next strong support level 16.20 (former strong support from December and January).
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AT&T broke key support level 16.60
Likely to fall to support level 16.20
AT&T under the bearish pressure after the price broke the key support level 16.60 (which has been reversing the price from January).
The breakout of the support level 16.60 coincided with the breakout of 38.2% Fibonacci correction of the sharp upward impulse from October.
Given the strength of the active downward impulse wave 3, AT&T can be expected to fall further to the next strong support level 16.20 (former strong support from December and January).
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#EURUSD is losing 1.9% from Wednesday's peak to a five-month low at 1.0650. US inflation data and ECB comments highlight the divergence of Fed and ECB monetary policy.
Wednesday's US inflation report appears to have set the trend for the dollar, taking it out of a more than four-month wander around its 200-day moving average. And the biggest contributor to this pullback is the EURUSD dynamics.
The pressure on the key currency market pair comes from several directions at once. On the US side, markets have continued to receive pro-inflationary data since the beginning of the month: acceleration in manufacturing activity, strong new job growth, and stronger CPI acceleration than expected. This data continued to push back the date of the expected Fed’s rate cut and the number of these moves.
On the European side, by contrast, data releases and comments from ECB officials are supporting the sentiment for the first cut in June. And this is a divergence that markets can no longer ignore.
Wednesday's US inflation report appears to have set the trend for the dollar, taking it out of a more than four-month wander around its 200-day moving average. And the biggest contributor to this pullback is the EURUSD dynamics.
The pressure on the key currency market pair comes from several directions at once. On the US side, markets have continued to receive pro-inflationary data since the beginning of the month: acceleration in manufacturing activity, strong new job growth, and stronger CPI acceleration than expected. This data continued to push back the date of the expected Fed’s rate cut and the number of these moves.
On the European side, by contrast, data releases and comments from ECB officials are supporting the sentiment for the first cut in June. And this is a divergence that markets can no longer ignore.
The EURUSD dynamics during this week emphasise the serious bearish bias in the pair. The pair crossed the 50- and 200-day moving averages in a sharp move on Wednesday and closed well below them. Neither on Thursday nor on Friday did the Euro make any noticeable attempts to rebound.
Moreover, we don't even see the typical Friday thrust of short-term profit-taking with an ongoing sell-off. EURUSD slid to 1.0650, having fallen out of its trading range since late December.
EURUSD has been receiving support on dips towards 1.05 in 2023, spending only a few days below that level. The pair will likely test the strength of this support again very soon, and the accumulating difference in Fed and ECB policy reinforces the chances that the pair will not stop there this time.
If indeed EURUSD falls below 1.05 in April, the pair could fall to the next leg, finding support only near 0.95.
Moreover, we don't even see the typical Friday thrust of short-term profit-taking with an ongoing sell-off. EURUSD slid to 1.0650, having fallen out of its trading range since late December.
EURUSD has been receiving support on dips towards 1.05 in 2023, spending only a few days below that level. The pair will likely test the strength of this support again very soon, and the accumulating difference in Fed and ECB policy reinforces the chances that the pair will not stop there this time.
If indeed EURUSD falls below 1.05 in April, the pair could fall to the next leg, finding support only near 0.95.
#WaveAnalysis
#USDCAD broke key resistance level 1.3625
Likely to rise to resistance level 1.3860
USDCAD rising strongly after the earlier breakout of the key resistance level 1.3625 (which has been reversing the price from December) intersecting with the 61.8% Fibonacci correction of the downward ABC correction (2) from November.
The breakout of the resistance level 1.3625 coincided with the breakout of the daily up channel from January.
USDCAD can be expected to rise further to the next resistance level 1.3860 (former multi-month high from October, and the target for the completion of the active impulse iii).
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#USDCAD broke key resistance level 1.3625
Likely to rise to resistance level 1.3860
USDCAD rising strongly after the earlier breakout of the key resistance level 1.3625 (which has been reversing the price from December) intersecting with the 61.8% Fibonacci correction of the downward ABC correction (2) from November.
The breakout of the resistance level 1.3625 coincided with the breakout of the daily up channel from January.
USDCAD can be expected to rise further to the next resistance level 1.3860 (former multi-month high from October, and the target for the completion of the active impulse iii).
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#WaveAnalysis
#GBPAUD reversed from support level 1.918
Likely to rise to resistance level 1.9360
GBPAUD recently reversed up from the key support level 1.918 (which has been reversing the price from January).
The support level 1.918 was strengthened by the lower daily Bollinger Band and by the 38.2% Fibonacci correction of the upward impulse from December.
GBPAUD can be expected to rise further to the next resistance level 1.9360 (middle of the sideways price range inside which the pair has been moving from January).
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#GBPAUD reversed from support level 1.918
Likely to rise to resistance level 1.9360
GBPAUD recently reversed up from the key support level 1.918 (which has been reversing the price from January).
The support level 1.918 was strengthened by the lower daily Bollinger Band and by the 38.2% Fibonacci correction of the upward impulse from December.
GBPAUD can be expected to rise further to the next resistance level 1.9360 (middle of the sideways price range inside which the pair has been moving from January).
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It was a non-boring weekend for the #crypto market. Market sentiment swung sharply towards buying the dollar and selling stocks, gold, and cryptos on Friday afternoon. Also operating over the weekend, the crypto market accelerated its decline on Saturday, with capitalisation falling to $2.2 trillion (-18% from Monday's peak) but began to recover on Sunday and has risen to $2.42 trillion (-7% in seven days) at the time of writing.
Bitcoin's weekly decline was the largest in eight months and, in dollar terms, the largest on record since the November 2022 FTX crash. Following Bitcoin, other digital assets collapsed as well. Many of the largest altcoins lost about a third of their value over Friday and Saturday.
Bitcoin's weekly decline was the largest in eight months and, in dollar terms, the largest on record since the November 2022 FTX crash. Following Bitcoin, other digital assets collapsed as well. Many of the largest altcoins lost about a third of their value over Friday and Saturday.
#Bitcoin dipped below $60K over the weekend, but a recovery on Sunday and at the start of the day on Monday brought the price back up to $66.2K. The weekend's failure made the technical picture more contradictory. On the bullish side, BTCUSD met strong buying on the decline to the 61.8% retracement level from the rise from the lows at the beginning of the year to the peaks in March. It's a classic correction that often clears the way to the upside.
Bears, on the other hand, may cite a sharp dip below the 50-day moving average, which could break the multi-month uptrend. But we see this dip as a repeat of the January correction - necessary to keep buyers interested and to shake weak hands out of the market.
Bears, on the other hand, may cite a sharp dip below the 50-day moving average, which could break the multi-month uptrend. But we see this dip as a repeat of the January correction - necessary to keep buyers interested and to shake weak hands out of the market.
Oil is losing more than 1% on Monday, below $84 a barrel for WTI and below $89 for Brent after Friday's rollercoaster, when prices peaked above $87 and $91.6, respectively. The drivers were geopolitics, where fears of an escalation of the conflict between Israel and Palestine fueled the growth. The decline was helped by the relatively conciliatory rhetoric of the US and the strengthening of the dollar.
A double top - a reversal technical pattern - was recorded on the oil charts. The RSI exit from the overbought zone on daily timeframes also supports the idea of further price decrease. In addition, a short-term downward trend can be identified from the fifth of April.
The strengthening of the dollar due to the shift in expectations for the key Fed rate has been visibly eating away at risk appetite since the beginning of April, leaving oil no escape from this trend.
Nevertheless, there are still doubts that we are seeing the start of a downtrend rather than short-term profit-taking.
A double top - a reversal technical pattern - was recorded on the oil charts. The RSI exit from the overbought zone on daily timeframes also supports the idea of further price decrease. In addition, a short-term downward trend can be identified from the fifth of April.
The strengthening of the dollar due to the shift in expectations for the key Fed rate has been visibly eating away at risk appetite since the beginning of April, leaving oil no escape from this trend.
Nevertheless, there are still doubts that we are seeing the start of a downtrend rather than short-term profit-taking.
Firstly, we there was an acceleration at the end of March, and the current pullback so far fits into the uptrend. It is worth watching closely the price dynamics near the previous peak ($82.50-83.0) and the previous local bottom ($80.50). A rebound from one of these levels will reinforce the idea of a bull market for oil.
Secondly, the supply and demand balance is on the bulls' side. Economic growth in Europe is still gaining momentum, America is not slowing down, and China is in the stimulus phase. Oil supply is in no hurry to expand despite the recent price increase. The US has been producing at a rate of 13.1M B/D for the past five weeks, and the number of oil rigs is just over 500, de facto stagnating so far this year.
Simply put, we're sticking with the idea for now that WTI crude won't easily fall below $80 in the coming days. The chances are much higher that it will find buyer support somewhere between $80.50 and $82.5 on a combination of geopolitics, strong demand and stagnant production.
Secondly, the supply and demand balance is on the bulls' side. Economic growth in Europe is still gaining momentum, America is not slowing down, and China is in the stimulus phase. Oil supply is in no hurry to expand despite the recent price increase. The US has been producing at a rate of 13.1M B/D for the past five weeks, and the number of oil rigs is just over 500, de facto stagnating so far this year.
Simply put, we're sticking with the idea for now that WTI crude won't easily fall below $80 in the coming days. The chances are much higher that it will find buyer support somewhere between $80.50 and $82.5 on a combination of geopolitics, strong demand and stagnant production.
US retail sales simultaneously support stocks and the dollar
US retail sales rose 0.7% in March after a 0.9% jump (revised from 0.6%) in February. An increase of 0.4% was expected. Such strong data reverses the pattern of last month when February's growth did not outweigh January's dip. By last year, retail sales in terms of money rose 4.1%, outpacing inflation of 3.5% y/y.
Retail sales excluding autos rose 1.1%, also comfortably to a record high in money. Meanwhile, purchases of fuel and building materials remain in a downtrend from the second half of 2022.
Strong retail sales growth further placates the doves at the Fed, helping to dampen further the chances of a rate cut in the coming months. At the same time, strong selling coupled with a relatively good start to the reporting season is positive for the stock market, helping the S&P500 and Nasdaq100 bounce off their 50-day moving averages, leaving them within upward trends.
US retail sales rose 0.7% in March after a 0.9% jump (revised from 0.6%) in February. An increase of 0.4% was expected. Such strong data reverses the pattern of last month when February's growth did not outweigh January's dip. By last year, retail sales in terms of money rose 4.1%, outpacing inflation of 3.5% y/y.
Retail sales excluding autos rose 1.1%, also comfortably to a record high in money. Meanwhile, purchases of fuel and building materials remain in a downtrend from the second half of 2022.
Strong retail sales growth further placates the doves at the Fed, helping to dampen further the chances of a rate cut in the coming months. At the same time, strong selling coupled with a relatively good start to the reporting season is positive for the stock market, helping the S&P500 and Nasdaq100 bounce off their 50-day moving averages, leaving them within upward trends.
#WaveAnalysis #SPX
S&P 500 falling inside sharp C-wave
– Likely to fall to support level 5000.00
S&P 500 index continues to fall inside the sharp c-wave of the minor ABC correction ii from the end of last month.
The price earlier broke the support levels 5100.00 and 5140.00, which strengthened the bearish pressure on these index .
Given the worsening sentiment seen across the USA equity, S&P 500 index can be expected to fall further to the next round support level 5000.00.
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S&P 500 falling inside sharp C-wave
– Likely to fall to support level 5000.00
S&P 500 index continues to fall inside the sharp c-wave of the minor ABC correction ii from the end of last month.
The price earlier broke the support levels 5100.00 and 5140.00, which strengthened the bearish pressure on these index .
Given the worsening sentiment seen across the USA equity, S&P 500 index can be expected to fall further to the next round support level 5000.00.
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#WaveAnalysis
#EURUSD broke support level 1.0730
Likely to fall to support level 1.0570
EURUSD currency pair fall after the earlier breakout of the key support level 1.0730 (which has been reversing the price from December) intersecting with the 61.8% Fibonacci correction of the ABC correction (2) from October.
The breakout of the support level 1.0730 accelerated the iii-wave of the active impulse waves 3 and (3) .
Given the continuing bullish USD sentiment, EURUSD can be expected to fall further to the next support level 1.0570.
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#EURUSD broke support level 1.0730
Likely to fall to support level 1.0570
EURUSD currency pair fall after the earlier breakout of the key support level 1.0730 (which has been reversing the price from December) intersecting with the 61.8% Fibonacci correction of the ABC correction (2) from October.
The breakout of the support level 1.0730 accelerated the iii-wave of the active impulse waves 3 and (3) .
Given the continuing bullish USD sentiment, EURUSD can be expected to fall further to the next support level 1.0570.
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The sell-off in US stock markets initial positivity. As a result, the #crypto market cap fell 5.4% in 24 hours to 2.29 trillion, back near the weekend lows. The market is hovering near the lows of March. This is a key moment in choosing the market’s direction for the coming weeks. A bounce out of this area will allow for the expectation of an early recovery to the recent highs. A dip below would likely trigger a broader liquidation of positions.
#Bitcoin has returned to the lows of the past 7 weeks, coinciding with the 61.8% retracement of the rally from the January lows. Bitcoin is choosing between a loosely controlled deepening of the decline or a reversal to growth. On the negative side, the 50-day MA acted as resistance on Monday.
According to CoinShares, crypto fund investments fell by $126 million last week after inflows of $646 million a week earlier. Bitcoin investments decreased by $110 million, Ethereum - by $29 million, and Solana - by $4 million.
#Bitcoin has returned to the lows of the past 7 weeks, coinciding with the 61.8% retracement of the rally from the January lows. Bitcoin is choosing between a loosely controlled deepening of the decline or a reversal to growth. On the negative side, the 50-day MA acted as resistance on Monday.
According to CoinShares, crypto fund investments fell by $126 million last week after inflows of $646 million a week earlier. Bitcoin investments decreased by $110 million, Ethereum - by $29 million, and Solana - by $4 million.
Gold has been behaving erratically correlated with global risk appetite in recent days.
On Friday, the price set an all-time high above $2430, losing $100 before the end of that day, nullifying the most furious final part of the rally within four hours. The final sell-off was in unison with the markets' fall. But on Monday, the pressure in the stock markets intensified again, and gold moved higher.
Neither geopolitics nor fear of interest rate moves explain these shifts. Gold seems to be living its own world, in which geopolitics is used as a convenient explanation for the rise, and the rise of the dollar is used as an ex post facto explanation for the decline.
In our view, the price run-up on Thursday and Friday morning was so significant because it occurred in thin air territory after many days of making new highs and caught a wave of stop orders above $2400.
The impressive profit-taking at the end of the day on Friday had every chance of reversing the uptrend, which most often happens.
On Friday, the price set an all-time high above $2430, losing $100 before the end of that day, nullifying the most furious final part of the rally within four hours. The final sell-off was in unison with the markets' fall. But on Monday, the pressure in the stock markets intensified again, and gold moved higher.
Neither geopolitics nor fear of interest rate moves explain these shifts. Gold seems to be living its own world, in which geopolitics is used as a convenient explanation for the rise, and the rise of the dollar is used as an ex post facto explanation for the decline.
In our view, the price run-up on Thursday and Friday morning was so significant because it occurred in thin air territory after many days of making new highs and caught a wave of stop orders above $2400.
The impressive profit-taking at the end of the day on Friday had every chance of reversing the uptrend, which most often happens.
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On the daily timeframes, the RSI index rolled back to 73, which is on the border with the overbought area, and recorded two peaks near 85 in March and April. A further pullback to the area below 70 would be a harbinger of a broad correction.
On weekly timeframes, the RSI is above 79, an overbought area that gold has touched only five times since 1980, and each time, it has been followed by a correction or the start of a bear market within 1-4 weeks. The exception to this was 1979-1980, when the value of the ounce increased, and relatively short-lived consolidations followed growth impulses.
Market tensions in recent days have also worked in favour of the bears in gold. Contrary to popular logic, gold rises against general risk demand only in the first days of the sell-off. If the pressure on equities becomes a trend, gold quickly catches up and overtakes the markets in its decline, only to be stopped by a monetary policy reversal.
On weekly timeframes, the RSI is above 79, an overbought area that gold has touched only five times since 1980, and each time, it has been followed by a correction or the start of a bear market within 1-4 weeks. The exception to this was 1979-1980, when the value of the ounce increased, and relatively short-lived consolidations followed growth impulses.
Market tensions in recent days have also worked in favour of the bears in gold. Contrary to popular logic, gold rises against general risk demand only in the first days of the sell-off. If the pressure on equities becomes a trend, gold quickly catches up and overtakes the markets in its decline, only to be stopped by a monetary policy reversal.