WEEKLY TECHNICAL ANALYSIS & PRICE MARKET STRATEGY

04 Dec

WEEKLY TECHNICAL ANALYSIS & PRICE MARKET STRATEGY – 04 December 2022

/ CSFX Analytics

WEEKLY SNAPSHOT

CPI (YoY) (Nov), U.K.

WHEN: WHAT IT HAD INFLUENCED:

30 November 2022 GBP and its subsequent pairs

WHAT HAPPENED: The Consumer Price Index (CPI) measures the change in the prices of goods and services contained in a basket of consumer items. The Central bank pays remarkably close attention to this figure in maintaining price stability.

GBP TRY is trading in an upward channel. Further upside can be seen in the coming week.

Nonfarm Payrolls (Nov), U.S.

WHEN: WHAT IT HAD INFLUENCED:

2 December 2022 USD and its subsequent pairs

WHAT HAPPENED: Nonfarm Payrolls measure the change in the number of people employed during the prior month, excluding workers in the farming industry. Given that full employment is one of the Federal Reserve’s mandates, it is very closely watched.

USDZAR is currently in the upward channel. Further upside can be seen in the coming week.

Retail Sales (MoM), AUSTRALIA

WHEN: WHAT IT HAD INFLUENCED:

2 December 2022 AUD and its subsequent pairs

WHAT HAPPENED: Retail Sales gauges the change taken together with the value of sales at the retail level across the country. It is an important indicator of consumer spending accounting for most of the overall economic activity.

AUDNZD is currently in the downward channel. The further downside can be seen in the coming week.

Gold steadies above $1,800 ahead of U.S. payrolls data

WHAT IT HAD INFLUENCED:

GOLD

WHAT HAPPENED:

Gold prices steadied around multi-month highs on Friday as markets hunkered down ahead of key U.S. payrolls data that could factor into the path of monetary policy, while copper stuck to a two-week high on hopes of a Chinese reopening.

Metal markets were set for strong gains this week, tracking signals from the Federal Reserve that the central bank will hike interest rates at a slower pace in the coming months. Precious metals, which were pressured by a sharp rise in rates this year, were the main beneficiaries of this rally.

Spot gold fell 0.1% to $1,800.96 an ounce, but remained near three-month highs, while gold futures hovered near $1,814.70 an ounce- their strongest level in five months.

Both instruments were set to add about 3% this week.

Focus now turns to U.S. nonfarm payrolls data due later in the day, which is expected to show that the jobs market cooled slightly in November. But the sector has remained robust this year, with the Federal Reserve stating that it will seek more moderation in the space as it tightens policy.

Any unexpected signs of strength in the jobs market gives the Fed enough impetus to keep raising interest rates- a scenario which is negative for markets.

GOLD is trading in up channel; a upside will be seen in the coming days.

Crude oil lower post payrolls; Weekly gains ahead of OPEC meeting

WHAT IT HAD INFLUENCED:

CRUDE OIL

WHAT HAPPENED:

Oil prices fell Friday after strong U.S. jobs data boosted the dollar but are still set to post a positive week ahead of the weekend’s OPEC+ meeting and the start of an EU ban on Russian crude imports.

By 09:15 ET, U.S. crude futures traded 0.5% lower at $80.83 a barrel, while the Brent contract fell 0.6% to $86.32.

Data released Friday also showed that the U.S. labour market remained strong in November, as job creation held up despite increasing signs of layoffs across the economy.

Nonfarm employment grew by 263,000 through the middle of the month, well above the 200,000-consensus forecast. October’s number was also revised up by 23,000 to show a gain of 284,000.

This helped the dollar gain as traders reassessed the likelihood of the U.S. Federal Reserve continuing to aggressively tighten monetary policy, given the resilience of the jobs market.

The US Dollar Index, which tracks the greenback against a basket of six other currencies, rose 0.4% to 105.148, after earlier falling to its lowest level since August. A stronger dollar makes crude, which is denominated in the U.S. currency, more expensive for foreign buyers.

That said, both crude benchmarks were on track for their first weekly gains – the biggest in two months at around 5.5% and 3%, respectively – after three consecutive weeks of decline.

Behind a lot of the week’s gains has been optimism that China, the largest importer of crude in the world, is moving towards lifting its extremely tight mobility restrictions as it battles COVID cases near record levels.

WTI CRUDE OIL is trading in a down channel; a downside will be seen in the coming days.

Crypto Analyst Warns About the End Game for BTC and ETH Bears

WHAT IT HAD INFLUENCED:

BITCOIN

WHAT HAPPENED:

Popular crypto trader and analyst Jason Pizzino is looking into the present market conditions and the probability of the market already hitting rock bottom. Pizzino said in a recent YouTube video that cryptos including Bitcoin and Ethereum are unlikely to fall to their bottom levels.

Pizzino is a prominent trader with over 278k subscribers on YouTube. He stated that if BTC crosses its highest value in August, the probability of it falling to $10,000 is Meager.

Pizzino stated that it is not looking good for the $10,000 Bitcoin bears. Speaking about Ethereum, he stated that ETH is staying robust and the chances of it hitting $500 are unlikely.

He stated that ETH is being pumped away and the consolidation is above the previous zone. He also added that it is better to forget ETH hitting the $300-$500 range. Pizzino highlighted that the extreme bears are in the process of getting absolutely crushed.

BTC is currently trading at $16,999.50 and ETH at $1,289.50. BTC is up by 0.12% and ETH by 1.02% in the last 24 hours.

BITCOIN is trading in a down channel; a downside will be seen in the coming days.

5 KEY EVENTS TO WATCH OUT

Retail Sales (MoM) (Oct), U.K.

WHEN: WHAT IT INFLUENCES:

05 DECEMBER 2022 GBP and its subsequent pairs

WHAT’S HAPPENING: Retail Sales gauges the change taken together the value of sales at the retail level across the country. It is an important indicator of consumer spending accounting for most of the overall economic activity.

A reading stronger than the forecast is supportive (bullish) for the EUR, while a weaker one is negative (bearish) for the EUR.

ISM Non-Manufacturing PMI (Nov), U.S.

WHEN: WHAT IT INFLUENCES:

05 DECEMBER 2022 USD and its subsequent pairs

WHAT’S HAPPENING: The Institute of Supply Management (ISM) Non-Manufacturing Purchasing Managers’ Index (PMI) (also known as the ISM Services PMI) report on Business, is based on data compiled from monthly replies to questions asked of more than 370 purchasing and supply executives in over 62 different industries.

A reading above 50 percent indicates the non-manufacturing sector economy is expanding; below 50 percent indicates the non-manufacturing sector is contracting. Given the substantial proportion of the US economy engaged in the services sector, this report offers insights into the health of the overall US economy.

BoC Interest Rate Decision, CANADA

WHEN: WHAT IT INFLUENCES:

07 DECEMBER 2022 CAD and its subsequent pairs

WHAT’S HAPPENING: The Bank of Canada (BOC) publishes its decision on where to set the benchmark interest rate. As short-term interest rates are an essential determinant of currency valuation, traders watch interest rate changes closely.

A reading weaker than the forecast is supportive (bullish) for the CAD, while a stronger one is negative (bearish) for the CAD.

RBA Interest Rate Decision (Dec), AUSTRALIA

WHEN: WHAT IT INFLUENCES:

06 DECEMBER 2022 AUD and its subsequent pairs

WHAT’S HAPPENING: The Reserve Bank of Australia (RBA) reports its decision on where to set the benchmark interest rate. As short-term interest rates are an important determinant of currency valuation, traders watch interest rate changes closely.

A reading stronger than the forecast is supportive (bullish) for the AUD, while a weaker one is negative (bearish) for the AUD.

GDP (QoQ) (Q3) (JPY), JAPAN

WHEN: WHAT IT INFLUENCES:

08 DECEMBER 2022 JPY and its subsequent pairs

WHAT’S HAPPENING: Gross Domestic Product (GDP) measures the change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health.

A reading that is stronger than the forecast is supportive (bullish) for the JPY, while a weaker-than-forecast reading is negative (bearish) for the JPY

EQUITIES IN THE COMING WEEK

Broadcom Inc. (AVGO) is to announce its Quarterly Results on 8 DECEMBER 2022, EPS is estimated to be 10.28 per share while revenue is estimated at 8.901B.
AutoZone, Inc. (AZO) to announce its Quarterly Results on 6 DECEMBER 2022, EPS estimated to 25.29 per share while revenue estimated 3.863B.
Brown Forman Inc. (BF. A) is to announce its Quarterly Results on 7 DECEMBER 2022, EPS is estimated to be 0.55 per share while revenue is estimated at 1.082B.
Vail Resorts, Inc. (MTN) is to announce its Quarterly Results on 8 DECEMBER 2022, EPS is estimated at 3.42 per share while revenue is estimated at 255.5M.
HealthEquity, Inc. (HQY) is to announce its Quarterly Results on 6 DECEMBER 2022, EPS is estimated to be 0.34 per share while revenue is estimated at 207.786M.