Weekly Technical Analysis & Price Market Strategy- 26 August 2023
26 Aug 2023
Economic Showdown: Germany’s CPI Tango Set to Impact EUR’s Fate.
Welcome to a captivating journey through the intricate landscape of global markets. In this concise yet enlightening introduction, we unravel the recent shifts that have been shaping the financial world. From the ebb and flow of crude oil prices to the wild ride of the cryptocurrency realm, and the nuanced signals of economic indicators, we bring you a snapshot of the forces at play.
5 KEY EVENTS TO WATCH OUT
German CPI (YoY) (Aug), U.K.
WHEN: 30 AUG 2023
WHAT IT INFLUENCES: GBP and its subsequent pairs
WHAT’S HAPPENING: Deciphering the Consumer Price Index (CPI)
The Consumer Price Index (CPI) serves as a compass for tracking the ebb and flow of prices attached to goods and services, lending a keen insight into the consumer’s economic experience. And when Germany, a heavyweight in the eurozone, enters the CPI stage, all eyes are on the price stability tango performed by the European Central Bank. A dance where a stronger-than-expected performance nurtures a bullish atmosphere for the EUR, while a weaker-than-expected show dims the EUR’s shine.
CB Consumer Confidence (Aug), U.S.
WHEN: 29 AUG 2023
WHAT IT INFLUENCES: USD and its subsequent pairs
WHAT’S HAPPENING: Poking the Economy’s Confidence Button
Imagine the economy as a colossal Jenga tower – consumer confidence, the piece that can make or break it. This Conference Board (CB) measurement delves into the sentiments of the masses, uncovering their economic courage. Optimism fuels spending, igniting the flames of consumption and economic expansion. A hearty reading is a warm hug for the USD’s prospects, while a timid forecast dims its sparkle.
Retail Sales (MoM), AUD
WHEN: 28 AUG 2023
WHAT IT INFLUENCES: AUD and its subsequent pairs
WHAT’S HAPPENING: Retail Revelations
The stage is set, the curtain drawn – retail sales take the spotlight. With a laser focus on the change in sales’ aggregate value at the retail level, this indicator paints a vivid picture of consumer spending’s pulse, which is the lifeblood of any economy. Think of it as a financial kaleidoscope, where a bullish AUD arises from stronger-than-expected results, and a bearish shadow falls upon a weaker-than-expected performance.
Industrial Production (MoM) (Jul), JPY
WHEN: 31 AUG 2023
WHAT IT INFLUENCES: JPY and its subsequent pairs
WHAT’S HAPPENING: The Manufacturing Symphony
The orchestra of manufacturing, quarries, and utilities, unite! Industrial Production steps onto the stage, measuring the inflation-adjusted value of their collective output. A bullish JPY tune graces the airwaves when the performance surpasses predictions, while a bearish undertone echoes through the market if expectations fall short.
ANZ Business Confidence (Aug), NZD
WHEN: 31 AUG 2023
WHAT IT INFLUENCES: NZD and its subsequent pairs
WHAT’S HAPPENING: Gauging Kiwi Business Vibes
A Kiwi lens on business – that’s what ANZ Business Confidence offers. It’s a sneak peek into New Zealand’s current business climate, revealing whether business owners are sporting smiles or furrowed brows. Upward trends signal investments sprouting like spring flowers, hinting at potential output growth. The magic behind the scenes? A survey capturing the economic dreams of around 1,500 businesses, set the tone for the year ahead.
EQUITIES IN THE COMING WEEK
BROADCOM INC. (AVGO) – Unveiling Q3 Fortunes
WHEN: 31 AUGUST 2023
Get ready to decode the financial narrative of BROADCOM INC. (AVGO). As the curtains rise on this quarterly spectacle, whispers of an EPS estimate of 10.43 per share circulate, accompanied by an anticipated revenue of 8.851B. Will these numbers propel AVGO to new heights or prompt a curtain call?
SALESFORCE, INC. (INTU) – The Quarterly Revelation
WHEN: 30 AUGUST 2023
A peek into the ledger of SALESFORCE, INC. (INTU) awaits. Be prepared for the unveiling of an EPS estimate of 1.90 per share, partnered with an expected revenue of 8.529B. Will this quarterly performance paint a masterpiece on INTU’s canvas or introduce unexpected hues?
PDD HOLDINGS INC. (PDD) – The Quarterly Spotlight
WHEN: 29 AUGUST 2023
Lights, camera, quarterly reveal! PDD HOLDINGS INC. (PDD) steps onto the stage with an anticipated EPS estimate of 1.01 per share and an expected revenue of 5.977B. The suspense builds – will PDD’s performance be a blockbuster hit or a quiet sleeper?
VMWARE, INC. (VMW) – Unmasking the Quarter
WHEN: 31 AUGUST 2023
VMWARE, INC. (VMW) readies for its quarterly unveiling, holding an EPS estimate of 1.72 per share and a forecasted revenue of 3.452B. As the balance sheet comes into focus, will VMW’s performance be a crescendo of success or a gentle hum?
HP INC. (HPQ) – The Quarterly Stage
WHEN: 29 AUGUST 2023
HP INC. (HPQ) takes the spotlight, showcasing its quarterly narrative with an estimated EPS of 0.86 per share and an expected revenue of 13.377B. The market awaits with bated breath – will HPQ’s performance earn a standing ovation or a hushed applause?
TOP COMMODITIES IN THE COMING WEEK
GOLD: Riding the Waves of Destiny
GOLD enthusiasts, brace yourselves. The market is awash in whispers of a down-channel trajectory, signaling a journey into lower terrain. Amidst this turbulence, the RSI floats at 48.42, the MACD performs a delicate dance, and the Bollinger Bands hug close, promising calmer waters ahead. With gold charting its course beneath both the 100-day and 200-day moving averages, the levels to watch glimmer on the horizon:
- Support: $1902.89
- Resistance: $1931.38
Trade Suggestion: Sail in at 1892.93, Drop Anchor at 1865.87, Set Sail at 1912.86.
SILVER: Navigating the Upswing
Silver’s voyage reveals an up-channel route, signaling potential ascent. While the RSI at 62.34 stokes optimism, the MACD’s bullish crossover adds its tune. Wide Bollinger Bands hint at an adventurous ride. The upwardly sloping 50-day and 200-day moving averages anchor the optimism, while the 100-day average plays a part in the market’s pause. The treasure map highlights:
- Support: $23.62 per ounce
- Resistance: $24.50 per ounce
Trade Suggestion: Chart a course at 24.77, Celebrate at 25.58, and Set the course at 24.13.
BRENT CRUDE OIL: The Upward Current
BRENT CRUDE OIL embarks on an up-channel journey, promising upward vistas. The bullish RSI at 54.09 sets a buoyant tone, while the MACD’s neutral crossover offers a detour. The close Bollinger Bands hint at measured swells. As both the 50-day and 200-day moving averages slope upwards, the 100-day average remains in a sideways drift. The path unfolds:
- Support: 81.69
- Resistance: 84.63
Trade Suggestion: Set sail at 85.44, Anchor at 88.91, Seek refuge at 82.76.
TOP CRYPTO IN THE COMING WEEK
BTCUSD: Descending Trails
BTCUSD charts a downward channel, portending a descent. The bearish RSI at 28.34 sets a somber tone, mirrored by the MACD’s negative crossover. The wide Bollinger Bands warn of looming volatility. While the 50-day and 200-day moving averages slope downward, the 100-day counterpart clings to a sideways path. Navigate the terrain:
- Support: 25572.93
- Resistance: 26768.92
Trade Suggestion: Venture in at 25117.32, Secure treasure at 23636.57, and Plot retreat at 26028.54.
LITECOIN: Unveiling the Downside
LITECOIN unveils a downtrend, predicting a fall. The bearish RSI at 28.61 sets a mournful note, as the MACD’s neutral crossover chimes in. The wide Bollinger Bands signal volatility ahead. With the 50-day and 200-day moving averages sloping downward, and the 100-day mirror joining the descent, the path is stark:
- Support: 61.89
- Resistance: 67.25
Trade Suggestion: Enter at 60.02, Secure gains at 54.12, Safeguard at 64.31.
TOP CURRENCY IN THE COMING WEEK
EURUSD: Descending Pathways
EURUSD charts a descent, forecasting a decline. The bearish RSI at 32.34 signals caution, while the MACD’s neutral crossover adds its voice. Close Bollinger Bands hint at stability. With both the 50-day and 200-day moving averages sloping downward, the 100-day counterpart maintains its sideways stance. The roadmap is clear:
- Support: 1.0773
- Resistance: 1.0852
Trade Suggestion: Enter at 1.0736, Secure gains at 1.0630, Protect at 1.0825.
GBPUSD: Navigating the Downturn
GBPUSD navigates a downtrend, forecasting descent. The bullish RSI at 34.59 stands in contrast, as the MACD’s negative crossover calls for caution. Close Bollinger Bands promises stability. With the 50-day and 200-day moving averages in descent, and the 100-day counterpart meandering in consolidation, the map reads:
- Support: 1.2569
- Resistance: 1.2668
Trade Suggestion: Enter at 1.2538, Secure gains at 1.2426, Protect at 1.2643.
AUDUSD: Tracing the Decline
AUDUSD traces a downward channel, heralding a fall. The bearish RSI at 34.33 adds a cautionary note, while the MACD’s neutral crossover shares its perspective. Wide Bollinger Bands point to a volatile path. With both the 50-day and 200-day moving averages downward-bound, and the 100-day average mirroring the descent, the guideposts reveal:
- Support: 0.6378
- Resistance: 0.6455
Trade Suggestion: Enter at 0.6339, Secure gains at 0.6234, Safeguard at 0.6427.
TOP INDEX IN THE COMING WEEK
DOW JONES: Scaling the Heights
DOW JONES charts an ascent, hinting at a climb. The bearish RSI at 38.96 balances against the MACD’s negative crossover. Wide Bollinger Bands foretell heightened activity. As both the 50-day and 200-day moving averages climb, the 100-day average adds a sideways melody. The markers for the journey are clear:
- Support: 33995.78
- Resistance: 34530.89
Trade Suggestion: Enter at 33900.22, Secure gains at 33441.56, Protect at 34263.33.
FTSE 100: Navigating the Decline
FTSE 100 navigates a descent, promising a fall. The neutral RSI at 42.74 is harmonized by the bullish MACD crossover. Wide Bollinger Bands forecast volatility. With both the 50-day and 200-day moving averages descending, and the 100-day mirror following suit, the path takes shape:
- Support: 7301.1
- Resistance: 7377.6
Trade Suggestion: Enter at 7264.6, Secure gains at 7111.6, Safeguard at 7381.2.
Embrace these market tales, for they hold the whispers of trends and the echoes of possibilities. As the world of finance unfurls its enigmatic tapestry, these events and indicators emerge as guiding stars for traders and investors alike.
Market Recap: A Week of Market Movements and Influences
In the ever-changing landscape of financial markets, the past week witnessed a flurry of activities and influences that played a crucial role in shaping the direction of various assets. Let’s delve into the key events and their impacts on major market players.
Gold’s Dance: Navigating Through Fed Signals
Gold Prices Remain Above $1,900 Amid Hawkish Fed Risks
Despite facing the headwinds of hawkish sentiments from the Federal Reserve, the glitter of gold managed to hold its ground. The week showcased a nuanced interplay between the precious metal and the dollar, setting the stage for an intriguing week ahead.
Influence on Gold: The Jackson Hole Symposium
The anticipation surrounding the Jackson Hole Symposium loomed large, steering traders towards the allure of the dollar. This preference for the greenback exerted slight downward pressure on gold prices. However, the alluring aspect was the resilience demonstrated by gold, remaining above key support levels despite the backdrop of a stronger dollar.
Recovery After Lows: A Silver Lining
Gold’s trajectory showcased its resilience as it embarked on its first positive week in five. This remarkable rebound marked a recovery from the lows it experienced earlier in August, thereby hinting at the underlying strength of the precious metal.
Dollar Dynamics and Gold’s Outlook
The dynamics between gold and the dollar offered a compelling narrative. The dollar’s ascent to a two-month high on Friday accompanied by rising Treasury yields cast a shadow on gold’s path. The looming question remained—could gold withstand the pressure of higher U.S. interest rates?
Spotlight on Prices: Navigating the Figures
Spot gold exhibited a marginal retreat, falling 0.1% to rest at $1,914.08 an ounce. Simultaneously, the gold futures for December also experienced a dip of 0.3%, reaching $1,941.95 an ounce. These figures echoed the delicate balance that gold maintained throughout the week.
Technical Insight: Gold’s Trajectory
Technical analysis shed light on gold’s potential course. Trading within a down channel, gold hinted at a potential downside in the days ahead. This forecast added a layer of intrigue to gold’s ongoing narrative.
Powell’s Clues and Oil’s Roller Coaster
Oil Prices Navigate Powell’s Hints Amidst Fluctuations
As the week progressed, the oil market found itself at a crossroads, influenced by a complex interplay of Powell’s signals, supply cuts, and global economic uncertainties. The following sections untangle the web of influences that shaped the oil market’s journey.
Influence on Oil: Powell’s Pronouncements
Oil prices embarked on a multi-day ascent, countering the earlier week’s losses. Yet, this recovery wasn’t robust enough to erase the red ink that stained the market for two consecutive weeks. Powell’s statements echoed the Federal Reserve’s determination to use rate hikes to tame U.S. inflation, a factor that loomed over oil’s recovery.
OPEC+ and Economic Jitters: A Delicate Balance
Supply cuts orchestrated by OPEC+ provided a buffer against oil’s downward spiral. However, the shadows of economic uncertainty cast by a sluggish recovery in China and the looming possibility of a recession in the U.S. and Europe created a complex tapestry of influences.
Friday’s Rebound: A Tug of War
Friday brought a glimmer of hope for oil prices, witnessing a rebound. Yet, the signals from the Fed served as a counterbalance, tempering this upward momentum. West Texas Intermediate (WTI) crude, trading in New York, managed to gain 78 cents or 1%, resting at $79.83 per barrel. Notably, WTI strived to reclaim the $80 per barrel mark, a significant threshold.
Channeling Oil’s Trajectory
Technical analysis painted a vivid picture of oil’s trajectory. With an upward channel becoming apparent, a potential upside was projected for the days ahead. However, this projection was met with the backdrop of economic uncertainties.
Bitcoin’s Fall: Miners and Market Dynamics
Bitcoin’s Plunge Triggers Miners’ Dilemma
The world of cryptocurrencies witnessed a tumultuous week as Bitcoin grappled with a steep decline. Amidst this descent, BTC miners faced challenges that sent ripples across the entire digital currency landscape.
Bitcoin’s Price Plunge: A Steep Descent
Bitcoin’s value took a nosedive, plummeting over 11% and settling at $25,899. This drastic decline showcased the volatile nature of the cryptocurrency market, leaving both investors and miners grappling with its repercussions.
Mining Complexity: An All-Time High
The backdrop of Bitcoin’s price plunge was accompanied by a notable milestone—the difficulty of mining Bitcoin reached an all-time high. While this boded well for the network’s robustness, it posed challenges for miners who found themselves navigating uncharted waters.
Miners’ Predicament: Balancing Act
Miners, facing substantial losses due to Bitcoin’s fall, resorted to selling. A staggering $72 million worth of Bitcoin was offloaded from their reserves within a single day, a testament to the challenges posed by the market’s volatility.
Bitcoin’s Market Fallout: Widespread Impact
The market’s upheaval had a cascading effect. Traders, investors, and miners alike were caught in the storm of losses. Those validating blocks on the network bore the brunt of this market turmoil, underscoring the interconnectedness of various players.
Bitcoin’s Ongoing Saga: The Road Ahead
Bitcoin’s journey was marked by failed attempts to recover from the depths of its descent. Despite hovering around $30,000 earlier, it currently struggled to breach the $26,000 mark, encapsulating the ongoing struggle to chart a recovery.
Mapping Bitcoin’s Path: Technical Insights
Technical analysis painted a somber picture, as Bitcoin found itself within a downward channel. This projection hinted at the potential for further downside in the near future.
Unpacking Economic Indicators: A Glimpse of Market Sentiment
Key Economic Indicators and Their Influence
The week also witnessed the release of significant economic indicators, offering insights into various economies and their trajectories. Let’s delve into some of the crucial indicators that shaped market sentiment.
Manufacturing PMI (Aug), EUR: A Gauge of Expansion
The Manufacturing Purchasing Managers’ Index (PMI) emerged as a pivotal indicator for the European region. With a reading above fifty signifying expansion and below fifty indicating contraction, this index acted as a barometer for the manufacturing sector’s health.
Initial Jobless Claims, U.S.: A Timely Economic Pulse
Initial Jobless Claims occupied the spotlight, providing a pulse on the U.S. economy. This indicator measured the number of individuals filing for unemployment insurance for the first time in the preceding week, painting a timely picture of the job market’s dynamics.
Core Retail Sales (MoM) (Jun), CAD: Unveiling Consumer Spending
Retail Sales served as a lens through which to view consumer spending trends. Excluding automobile sales, this indicator gauged the change in the aggregate value of sales at the retail level, offering a glimpse into the broader economic activity.
Conclusion: Navigating the Seas of Market Dynamics
As the week unfolded, the financial markets navigated through a diverse array of influences. From the intricate dance between gold and the dollar to the oil market’s response to Powell’s hints and Bitcoin’s tumultuous descent, the week painted a vivid picture of market dynamics. Economic indicators further added layers of insight, offering glimpses into various economies’ health. As the new week dawns, market participants find themselves poised for yet another chapter in the ongoing saga of global financial landscapes.