Weekly Technical Analysis & Price Market Strategy- 21 May 2023

21 May

WEEKLY TECHNICAL ANALYSIS & PRICE MARKET STRATEGY – 21 MAY 2023

/ CSFX Analytics

WEEKLY SNAPSHOT

CPI (YoY) (Apr), EUR

WHEN: WHAT IT HAD INFLUENCED:

17 MAY 2023 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 very close attention to this figure in its role of maintaining price stability.

Retail Sales (MoM) (Apr), U.S.

WHEN: WHAT IT HAD INFLUENCED:

16 MAY 2023 USD and its subsequent pairs

WHAT HAPPENED: Retail Sales gauges the change in the aggregate 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.

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

RBA Meeting Minutes (MoM), AUD

WHEN: WHAT IT HAD INFLUENCED:

16 MAY 2023 AUD and its subsequent pairs

WHAT HAPPENED: The Reserve Bank of Australia (RBA) Monetary Policy Meeting Minutes are a detailed record of the bank’s most recent policy-setting meeting, containing in-depth insights into the economic conditions that influenced the rate decision.

AUDUSD is trading in downward channel. Further downside can be seen in coming week.

Gold survives a difficult week on prolonged U.S. debt crisis, ending above $1,980.

WHAT IT HAD INFLUENCED:

GOLD

WHAT HAPPENED: The latest red flash in the U.S. debt crisis is aiding gold bulls in seeing green.

The dollar fell on Friday for the first time in five sessions because of a new breakdown in negotiations to increase the U.S. debt ceiling, which aided the rise of alternative safe havens like gold.

On Friday, gold for June delivery on the New York Comex settled at $1,981.60 per ounce, up $21.80 or 1.1% from the previous day. The benchmark gold futures contract, however, dropped from its all-time high of $2,085.40 on May 4 to as low as $1,954.40 in the preceding session. June gold fell 2% for the entire week.

By 14:06 ET (18:06 GMT) on Friday, the spot price of gold, which reflects physical deals in metal and is more carefully watched than futures by certain dealers, was at $1,954.12, up $24.72 or 1.3% on the day. However, after hitting a record high of $2,073.29 earlier this month, spot gold dropped as low as $1,952.03 in the previous session, according to statistics Spot gold was down 1.5% for the week.

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

Crude is still up on the week, but oil is down as U.S. debt discussions stall.

WHAT IT HAD INFLUENCED:

CRUDE OIL

WHAT HAPPENED: As talks to increase the U.S. debt ceiling again came to a standstill, crude prices gave up early gains to close Friday’s trading day down. The first weekly increase in five weeks came from gains between Monday and Wednesday, so the oil bulls could still celebrate.

President Joe Biden and Kevin McCarthy, the chief Republican challenger in Congress, earlier stated that they were closer than ever to reaching an agreement to increase the $31.4 trillion debt ceiling for the United States and that a resolution might be reached as early as Sunday to prevent a federal default on payments by June 1.

West Texas Intermediate, or WTI, crude for New York trading finished down 31 cents, or 0.5%, at $71.55 per barrel. WTI, meanwhile, was up roughly 2% for the week. Over the previous four weeks, the benchmark price for US oil decreased by a total of 15%.

On Friday, WTI and Brent both increased by more than $1 due to hope that the debt ceiling negotiations were moving forward.

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

Interest rates may not increase too much, according to Fed Chair Powell; The price of bitcoin fluctuates about $27,000.

WHAT IT HAD INFLUENCED:

BITCOIN

WHAT HAPPENED: Following Jerome Powell’s speech, the price of bitcoin originally increased to $27,140 before falling back to $26,800.

Powell said that although inflation is far higher than the Fed’s goal, the institution is still dedicated to bringing rates back to the 2% level.

Despite the significant worries about the US government’s potential debt default, interest rates are not anticipated to increase by 25 basis points.

The biggest cryptocurrency in the world immediately reacted positively to Jerome Powell’s speech, with the price of Bitcoin rising to almost $27,200. However, as of this writing, BTC is still trading around $26,873, keeping its position above the 100-day Exponential Moving Average (EMA).

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

5 KEY EVENTS TO WATCH OUT

Manufacturing PMI (MAY) U.K.

WHEN: WHAT IT INFLUENCES:

23 MAY 2023 GBP and its subsequent pairs

WHAT’S HAPPENING: The Manufacturing Purchasing Managers’ Index (PMI) is a diffusion index incorporating survey results provided by manufacturing firms throughout the region. A reading above fifty suggests the manufacturing sector is expanding, while a reading below fifty suggests the manufacturing sector is in contraction. Policymakers and traders watch these surveys closely as purchasing managers usually have early access to data about their company’s performance, rather than waiting for the hard data to emerge.

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

GDP (QoQ) (Q1), U.S.

WHEN: WHAT IT INFLUENCES:

25 MAY 2023 USD and its subsequent pairs

WHAT’S HAPPENING: Gross Domestic Product (GDP) measures the annualised 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 forecast is generally supportive (bullish) for the USD, while a weaker than forecast reading is generally negative (bearish) for the USD

Manufacturing PMI, AUD

WHEN: WHAT IT INFLUENCES:

23 MAY 2023 AUD and its subsequent pairs

WHAT’S HAPPENING: The Australian Manufacturing Purchasing Managers Index (PMI) measures the activity level of purchasing managers in the manufacturing sector. A reading above 50 indicates expansion in the sector; below indicates contraction. Traders watch these surveys closely as purchasing managers usually have early access to data about their company’s performance, which can be a leading indicator of overall economic performance.

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

Wholesale Sales (MoM), CAD

WHEN: WHAT IT INFLUENCES:

24 MAY APRIL 2023 CAD and its subsequent pairs

WHAT’S HAPPENING: Wholesale Sales reports the change in the value of sales at the wholesale level across Canada. It is an indicator of future consumer spending.

A reading that is stronger than the forecast is generally supportive (bullish) for the CAD, while a weaker-than-forecast reading is generally negative (bearish) for the CAD.
RBNZ Interest Rate Decision, NZD

WHEN: WHAT IT INFLUENCES:

24 MAY 2023 NZD and its subsequent pairs

WHAT’S HAPPENING: The Reserve Bank of New Zealand (RBNZ) governor decides where to set the rate after consulting senior bank staff and external advisers. As short-term interest rates are an important determinant of currency valuation, traders watch interest rate changes closely.

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

EQUITIES IN THE COMING WEEK

NIVIDIA CORPORATION (NVDA) to announce its Quarterly Results on 24 MAY 2023, EPS estimated to 0.92 per share while revenue estimated 6.525B.
INTUIT, INC. (INTU) to announce its Quarterly Results on 23 MAY 2023, EPS estimated to 8.49 per share while revenue estimated 6.094B.
MEDTRONIC PLC. (MDT) to announce its Quarterly Results on 25 MAY 2023, EPS estimated to 1.55 per share while revenue estimated 8.255B.
WORKDAY INC. (WDAY) to announce its Quarterly Results on 25 MAY 2023, EPS is estimated to 1.12 per share while revenue is estimated 1.67B.
AUTOZONE INC. (AZO) to announce its Quarterly Results on 23 MAY 2023 EPS estimated 31.51 per share while revenue estimated 4.123B.