WEEKLY TECHNICAL ANALYSIS & PRICE MARKET STRATEGY

27 Nov

WEEKLY TECHNICAL ANALYSIS & PRICE MARKET STRATEGY – 26 November 2022

/ CSFX Analytics

WEEKLY SNAPSHOT

CFTC Speculative Net Positions, U.K.

WHEN: WHAT IT HAD INFLUENCED:

19, NOVEMBER 2022 GBP and its subsequent pairs

WHAT HAPPENED: the Commodity Futures Trading Commission’s (CFTC) weekly Commitments of Traders (COT) report provides a breakdown of the net positions for “”non-commercial”” (speculative) traders in U.S. futures markets.
All data corresponds to positions held by participants primarily based in Chicago and New York futures markets.
The Commitments of Traders report is considered an indicator for analysing market sentiment and many speculative traders use the data to help them decide whether to take a long or short position.

Initial Jobless Claims, U.S.

WHEN: WHAT IT HAD INFLUENCED:

23 NOVEMBER 2022 USD and its subsequent pairs

WHAT HAPPENED: Initial Jobless Claims measures the number of people who filed for unemployment insurance for the first time during the past week. This is the timeliest U.S. economic data, but the market impact varies from week to week.

A reading that is higher than forecast is generally negative (bearish) for the USD, while a lower than forecast reading is generally supportive (bullish) for the USD.

RBNZ Interest Rate Decision, New Zealand

WHEN: WHAT IT HAD INFLUENCED:

23 NOVEMBER2022 NZD and its subsequent pairs

WHAT HAPPENED: 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 NZD, while a weaker than forecast reading is generally negative (bearish) for the NZD.

Gold steadies near $1,750 as US yields retreat

WHAT IT HAD INFLUENCED:

GOLD

WHAT HAPPENED: Gold price continues to move sideways at around $1,750 heading into the weekend. The benchmark 10-year US Treasury bond yield retreated from the daily high it touched above 3.75% earlier in the day, allowing XAU/USD to erase a portion of its daily losses.

Despite Gold premiums in China’s top hubs due to the renewed covid lockdowns, concerns over the impact of these restrictions on the Chinese economy are keeping markets unnerved. The bleak economic outlook for China intensifies worries over its spill over effect on the global economy, bolstering demand for Gold as a traditional safe-haven asset. China reported record-high COVID-19 infections on Thursday.

Nothing seems to have changed technically for gold price, as the upside bias remains intact after it yielded a bull flag on Thursday.

Doors remain open toward the three-month high of $1,787 should bulls take out the intraday high at $1,761 and this week’s high near $1,770.

GOLD is trading in Up channel; an upside will be seen in the coming days.

Oil prices fall 2% as Chinese demand worries linger

WHAT IT HAD INFLUENCED:

CRUDE OIL

WHAT HAPPENED: Oil prices fell 2% on Friday in thin market liquidity, closing a week marked by worries about Chinese demand and haggling over a Western price cap on Russian oil.

Brent crude futures settled down $1.71, or 2%, to trade at $83.63 a barrel, having retraced some earlier gains.

U.S. West Texas Intermediate (WTI) crude futures were down $1.66, or 2.1%, at $76.28 a barrel. There was no WTI settlement on Thursday due to the U.S. Thanksgiving holiday and trading volumes remained low.

“Because there’s light volume after the holiday, we’re giving up some of the gains here a bit,” said Phil Flynn, an analyst at Price Futures group.

Both contracts posted their third consecutive weekly declines after hitting 10-month lows this week. Brent ended the week down 4.6%, while WTI fell 4.7%.

Brent and WTI’s market structure implies current demand is softening, with backwardation, defined by front-month prices trading above contracts for later delivery, having weakened markedly in recent sessions.

For two-month spreads, Brent and WTI’s structures even dipped into contango this week, implying oversupply with near-term delivery contracts priced below later deliveries.

China, the world’s top oil importer, on Friday reported a new daily record for COVID-19 infections, as cities across the country continued to enforce mobility measures and other curbs to control outbreaks.

This is starting to hit fuel demand, with traffic drifting down and implied oil demand around 1 million barrels per day lower than average, an ANZ note showed.

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

Bitcoin price struggles to rebound as Binance launches $1 billion recovery fund

WHAT IT HAD INFLUENCED:

BITCOIN

WHAT HAPPENED: (BTC) price is trading in the red Friday despite Binance’s efforts to calm markets down after the spectacular collapse of the U.S.-based cryptocurrency exchange FTX.

Binance, the world’s largest cryptocurrency exchange, said yesterday that it established the Industry Recovery Initiative (IRI) to support the embattled crypto industry after the FTX collapse.

Binance committed $1 billion to IRI “with an intent to ramp up that amount to USD 2 billion in the near future if the need arises,” the exchange said in a blog post. The company added that it received around 150 applications from companies interested to support the IRI, including Jump Crypto, Polygon Ventures, Aptos Labs, Animoca Brands, GSR, Kronos, and Brooker Group.

“The mandate of this new effort is to support the most promising and highest quality companies and projects built by the best technologists and entrepreneurs that, through no fault of their own, are facing significant, short-term, financial difficulties. What makes this initiative unique is the collaborative approach to restoring confidence in Web3,” it is further stated in a blog post.

Still, Bitcoin price is trading near 2-year lows after failing to stage a relief rally on the back of the IRI launch. On Monday, the BTC price hit $15,460 – the lowest level seen since November 2020.

The global crypto market that has been putting on a green rally has slightly turned reddish. BTC is currently trading at $16567.60 and ETH at $1,217.22. BTC is up by 0.35% and ETH by 2.69% in the last 24 hours. It is unclear now whether the two-day bullish stance was a bubble and whether the market is going back to its bearish stance.

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

5 KEY EVENTS TO WATCH OUT

CFTC EUR SPECULATIVE NET POSITIONS (Nov), U.K.

WHEN: WHAT IT INFLUENCES:

29 NOVEMBER 2022 GBP and it subsequent pairs

WHAT’S HAPPENING: The Commodity Futures Trading Commission’s (CFTC) weekly Commitments of Traders (COT) report provides a breakdown of the net positions for “”non-commercial”” (speculative) traders in U.S. futures markets.
All data corresponds to positions held by participants primarily based in Chicago and New York futures markets.
The Commitments of Traders report is considered an indicator for analysing market sentiment and many speculative traders use the data to help them decide whether to take a long or short position.

CB Consumer Confidence (Nov), U.S.

WHEN: WHAT IT INFLUENCES:

29 NOVEMBER 2022 USD and its subsequent pairs

WHAT’S HAPPENING: Conference Board (CB) Consumer Confidence measures the level of confidence consumers have in the economy. When consumers are optimistic, they tend to spend more which increases consumption and overall economic growth.

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.

German CPI (YoY) (Nov), Germany

WHEN: WHAT IT INFLUENCES:

29 NOVEMBER 2022 GBP and its subsequent pairs

WHAT’S HAPPENING: The German Consumer Price Index (CPI) measures the changes in the price of goods and services purchased by consumers.

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 (MoM) (Sep), CANADA

WHEN: WHAT IT INFLUENCES:

29 NOVEMBER 2022 CAD and its subsequent pairs

WHAT’S HAPPENING: gross Domestic Product (GDP) reports the annualised change in the inflation-adjusted value of all goods and services produced by the Canadian economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health. Canada releases fresh GDP data on a monthly basis.

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

Building Approvals (MoM) (Oct), Australia

WHEN: WHAT IT IN INFLUENCES

30 NOVEMBER 2022 AUD and its subsequent pairs

WHAT’S HAPPENING: Building Approvals (also known as Building Permits) reports the change in the number of new building approvals issued by the government. Building approvals are an important indicator of new housing starts.

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.

EQUITIES IN THE COMING WEEK

PDD to announce its Quarterly Results on 28 November, EPS estimated to 0.54 per share.
BNS to announce its Quarterly Results on 29 NOVEMBER 2022, EPS estimated to 1.52 per share.
NTAP to announce its Quarterly Results on 29 NOVEMBER 2022, EPS estimated to 1.08 per share.
Splunk Inc, to announce its Quarterly Results on 30 NOVEMBER 2022, EPS estimated to 0.74 per share.
Marvel Technology, Inc to announce its Quarterly Results on 01 DECEMBER 2022, EPS estimated to 0.43 per share.