. Fundamental Analysis Report With Charting Trends- 28 April 2023

FUNDAMENTAL ANALYSIS REPORT WITH CHARTING TRENDS- 28 APRIL 2023

FUNDAMENTAL ANALYSIS REPORT WITH CHARTING TRENDS- 28 APRIL 2023

28 Apr 2023

FUNDAMENTAL REPORT FORECAST 

MARKET UPDATE:

Wall Street increases as the earnings season’s boost outweighs economic concerns.

The tech-heavy Nasdaq took the lead in a Wall Street rally on Thursday as Meta Platforms Inc., the parent company of Facebook, released a good quarterly report that eclipsed worries about sluggish U.S. economic growth. “Facebook earnings last night and large Cap earnings more broadly continue to surprise to the upside,” said Mona Mahajan, senior investment strategist at St. Louis-based Edward Jones.

“With these sectors already thriving, there were high expectations for results, thus there was some uncertainty as to whether they would fall short. Many of these business models proved to be quite resilient, she said. “And the other aspect of the story is that many cash-rich companies have been announcing buyback programmes,” the author continued.

The Nasdaq experienced its largest single-day increase since March 16 while the S&P and Dow posted their largest daily percentage advances since January 6.

The chief investment officer of Independent Advisor Alliance in Charlotte, North Carolina, Chris , said that the economic statistics presented on Thursday was less encouraging than the news from the company’s profits. It revealed that the U.S. economy grew less slowly than anticipated in the first quarter as businesses reduced their investment in inventories to balance an increase in consumer spending.

According to analyst estimates compiled by Refinitiv, expectations for the first quarter’s results have significantly increased. Now, experts predict a 2.4% year-over-year reduction in profits at S&P 500 businesses as opposed to the 5.1% decline predicted before the beginning of the earnings season.

What happened in the Asia Session?

The JPY suffered versus other major currencies because of the BoJ’s decision to retain its ultra-loose monetary policy and keep rates in the negative range. The central bank’s struggles to keep inflation above 2%, though, might raise questions about the nation’s economic future and jeopardise investor confidence in Japan.

What does it mean for the Europe & US Session?

The USD/JPY exchange rate is likely to become even more volatile because of the awaited BoJ’s Press Conference and the upcoming US Core PCE Price Index m/m. The pair may continue to seek to close above 135.00 and towards 136.00 into the last trading day of the trading week if the central bank of Japan is dovish or if US inflation is stronger than anticipated.

The Euro (EUR)

Key news events today

German Prelim CPI m/m

What can we expect from EUR today?

It is anticipated that the German Preliminary CPI would rise by 0.6% m/m, which is significantly less than the prior estimate of 0.8%. If the actual figure is lower than anticipated, this could have a negative effect on the EUR since it could indicate slower economic growth and lower inflationary pressures.

Central Bank Notes:

  • ECB raised interest rates by 50 basis points to ensure the 2% inflation target is met
  • Inflation is projected to average 5.3% in 2023, with growth at 1%, and underlying price pressures remain strong
  • The bank will continue to monitor market tensions closely and will be data-dependent in its policy rate decisions
  • Next meeting on 4 May 2023

Next 24 Hours Bias

Weak Bearish

The Canadian Dollar (CAD)

Key news events today

GDP m/m

What can we expect from CAD today?

Lower than the prior estimate of 0.5%, a forecast monthly GDP growth rate of 0.2% is anticipated for Canada. If the predicted data turns out to be accurate, it can be bad for CAD. The slower growth rate can be interpreted by traders as a symptom of a struggling economy, which could result in less demand for CAD.

Central Bank Notes:

  • Bank of Canada holds its target for the overnight rate at 4.5%
  • Labour markets remain tight with persistent price pressures, especially for services
  • Economic growth in Q1 looks to be stronger than projected; to be weak through the remainder of this year before strengthening gradually next year
  • Prepared to increase the policy rate further to return inflation to the 2% target.
  • Next meeting on 7 June 2023

Next 24 Hours Bias

Weak Bearish

The Pound (GBP)

Key news events today

No major news events.

What can we expect from GBP today?

Since there won’t be any significant news coming out of the UK today, the price trend will be influenced by previously released data. The CBI Realised Sales figures are an essential gauge of the success of the UK retail industry. The most recent data displays several 5, which is greater than the anticipated number of 4 and the prior number of 1. This suggests that the retail industry is doing better than expected, which could be advantageous for the economy.

Central Bank Notes:

  • The BoE’s MPC increased the Bank Rate by 25bps to 4.25%, with a majority of 7-2 in favour of the hike
  • The UK banking system is judged to be robust and resilient.
  • CPI inflation increased unexpectedly but is expected to fall sharply over the rest of the year due to lower energy prices.
  • The MPC will continue to monitor inflationary pressures and adjust Bank Rate as necessary.
  • Next meeting on 11 May 2023 

Next 24 Hours Bias

Mixed

Global Markets:

Asian Stock Markets: Nikkei up 1.40%, Shanghai Composite up 1.14%, Hang Seng up 0.27%, ASX up 0.23%

European equities, the DAX futures down 0.32%, CAC 40 down 0.71%, FTSE down 0.23%.

US Stock Market: Dow jones up 1.57%, S&P 500 up at 1.96%, Nasdaq 100 up at 2.43%.            

Commodities: Gold at $1983.10 (-0.22%), Silver at $24.84 (-0.41%), Brent Oil at $78.44 (+0.28%), WTI Oil at $74.82 (+0.07%)

News & Data

  • (USD) Core PCE Price Index (MoM) (Mar) Forecast 0.3%, Previous 0.3% at 18:00
  • (CAD) GDP (MoM) (Feb) Forecast 0.2%, Previous 0.5% at 18:00
  • (EUR) German CPI (MoM) (Apr) Forecast 0.6%, Previous 0.8% at 17:30 
  • (EUR) German GDP (QoQ) (Q1) Actual –0.1%, Forecast 0.3%, Previous 0.9% at 13:30
  • (JPY) BoJ’s Press Conference at 12:00

Technical Outlook

GBPUSD

Bullish momentum is currently seen on the GBP/USD chart. Price action is showing signs of strength, and this bullish momentum may eventually push the price further in the direction of the first resistance level at 1.2546.

Price might move higher towards the second resistance at 1.2598 if it were to overcome the first obstacle. This degree of resistance is extremely high and has the potential to be a powerful level of resistance.

In contrast, if the price were to turn around and move lower, it might run into support at the first support level at 1.2383. This support level has previously served as a strong level of assistance and is an overlap support.

The second support at 1.2339 is the amount of support that the price may fall to if it were to breach the first support. This support level should be closely watched because it also functions as an overlap support.

EURUSD

Bullish momentum is currently seen on the EUR/USD chart. Because of the bullish momentum, the price is in a bullish ascending channel, which indicates that price may continue to rise.

Given the bullish trend, price may continue to rise in the direction of the first resistance level at 1.1070. This resistance level is crucial to watch since it overlaps with a 78.60% Fibonacci projection and lines up with it.

Price might move upward towards the second resistance at 1.1129 if it were to overcome the first obstacle. This resistance level is crucial to watch because a -27% Fibonacci expansion lines up with it.

However, if the price were to turn around and move lower, it might find support at the first support level at 1.0993. This level of support, which is a swing low support, has served as a reliable level of support in the past.

The second support, at 1.0911, is the level of support that the price may fall to if it were to breach the first support. This support level is crucial to monitor because it also functions as an overlap support.

AUDUSD

Strong positive momentum is presently visible on the AUD/USD chart, and there is a chance that it will continue in that direction towards the first resistance level of 0.6676. 

On the chart, two significant support levels have been noted. The initial level of support is at 0.6593, a multiple-swing low support. This level has previously undergone several tests and has performed admirably, making it a strong support level for possible price rebounds. The second level of support is at 0.6567, which is a 127.20% Fibonacci Expansion and another multi-swing low support. 

There are two strong resistance levels to be on the lookout for. The first barrier is a pullback barrier at 0.6676, which also happens to be a 38.20% Fibonacci retracement. It is wise to keep an eye out for potential price reversals at this resistance level. Price might move up to the second resistance level at 0.6753 if it were to break through this resistance level, signalling a strong bullish momentum. 

Additionally, there is an overlap support level at 0.6623, which is a level of intermediate support. 

USDJPY

There is currently a bearish momentum on the USD/JPY chart. Despite being above a significant ascending trend line, the price is also contained within a bearish descending channel, suggesting that the bearish momentum may cause the price to continue to decline.

Price might perhaps fall to the first support level at 133.72 if it were to breach the rising trend line. Given the bearish momentum, price may make a bearish break off the first support and fall in the direction of the second support, which is at 132.34. 

Price might move upward towards the second obstacle at 136.76 if it were to break over the first resistance at 135.11. This level of resistance, which is an overlap resistance, has the potential to be very strong.

If the price were to turn around and move down, though, it might run into resistance at the intermediate resistance level at 134.37. 

Price might accelerate strongly bullishly towards the first resistance at 135.11 if it were to breach the intermediate level.

DAX 40

Strong positive momentum is currently visible on the GER30 chart, and there is a chance that it will continue in that direction approaching the first resistance level at 15940.1. The price is currently above the Ichi Moku cloud at 15709.70, indicating a positive trend as of this writing.

On the chart, two significant support levels have been noted. The initial level of support is at 14658.9, which also happens to be an overlap support and a 23.60% Fibonacci retracement. It is wise to keep an eye out for future price bounces around this support level. Another overlap support, the second support level is located at 15483.4. 

There are two strong resistance levels to be on the lookout for. The initial resistance level is located at 15940.1, a swing high resistance that also happens to be a Fibonacci projection of 78.60%. This resistance level can serve as a useful starting point for searching for potential price reversals. Price movement might flip in favour of the bullish side and reach the second barrier level at 16062.7 if it were to break over this level of resistance. A 127.20% Fibonacci expansion is this level.

WTI CRUDE OIL

With potential for a bullish bounce off the first support level at 73.21 and moving in the direction of the first resistance level at 77.16, the WTI chart is now showing bullish momentum. As of this writing, the price is above the Ichi Moku cloud at 75.75, demonstrating bullish momentum.

On the chart, two significant support levels have been noted. The initial support level, which is a pullback support, is around 73.21. It is wise to keep an eye out for future price bounces around this support level. The second support level, which also serves as a pullback support, is located at 71.13. This second support level might serve as a nice bounce point for prices to reverse back up if they were to fall below the first support level.

There are two strong resistance levels to be on the lookout for. The initial resistance level, an overlap resistance, is located at 77.16. This resistance level can serve as a useful starting point for searching for potential price reversals. Price might move up towards the second resistance level at 78.95 if it were to break through the first resistance level. Both resistance levels that overlap at this level suggest the possibility of continued bullish momentum.

At 73.21, which is an overlap support, there is also a level of intermediate support. This level may serve as a useful stopping point for a bullish continuation towards the first resistance level.

GOLD

Bullish momentum is there on the XAU/USD chart, and there is a chance that it will continue in that direction approaching the first resistance level at 2009.56. As of this writing, the price is above the Ichi Moku cloud at 1988.84, demonstrating bullish momentum.

On the chart, two significant support levels have been noted. 1974.04, a multiple-swing low support, serves as the first level of support. It is wise to keep an eye out for future price bounces around this support level. The second level of support is located at 1949.99 and is a multi-swing low support as well. 

There are two strong resistance levels to be on the lookout for. 2009.56, a multi-swing high resistance level, serves as the first level of resistance. This resistance level can serve as a useful starting point for searching for potential price reversals. Price might move up towards the second resistance level at 2031.48 if it were to break through the first resistance level. 

At 1983.30, a level of overlap support, there is also a level of intermediate support. This level may serve as a useful stopping point for a bullish continuation towards the first resistance level.

BITCOIN

With potential for a bearish response off the first resistance level at 30052 and a down to the first support level at 28771, the BTC/USD chart is currently showing bearish momentum. The price is below the Ichi Moku cloud as of this writing, at 29307.31, indicating a negative momentum.

On the chart, two significant support levels have been noted. The first support level, an overlap support, is at 28771. It is wise to keep an eye out for future price bounces around this support level. Another overlap support level at 26530, which also corresponds to a 38.20% Fibonacci retracement, serves as the second level of support. This second support level might serve as a nice bounce point for prices to reverse back up if they were to fall below the first support level.

There are two strong resistance levels to be on the lookout for. The initial resistance level, which is a swing high resistance, is located at 30051. This resistance level can serve as a useful starting point for searching for potential price reversals. Price movement might flip in favour of the bullish side and reach the second barrier level at 30479 if it were to break above this level of resistance. A swing high resistance level, this level also corresponds to a 78.60% Fibonacci retracement.