Weekly Technical Analysis with Candlestick Charts – 05 June 2022

Weekly Technical Analysis with Candlestick Charts – 05 June 2022

Technical Analysis

WEEKLY SNAPSHOT

Manufacturing PMI (May), U.K.

WHEN: 01st June 2022                                                   WHAT IT HAD INFLUENCED: GBP and its subsequent pairs.

WHAT HAPPENED: The Manufacturing Purchasing Managers’ Index (PMI) is a diffusion index incorporating survey results provided by manufacturing firms throughout the country. A reading above fifty suggests the manufacturing sector is expanding, while a reading below fifty suggests the manufacturing sector is in contraction. A reading that is stronger than forecast is generally supportive (bullish) for the GBP, while a weaker than forecast reading is generally negative (bearish) for the GBP.

GBP/USD is trading in an upward channel. Further upside movement can be seen in the coming weeks.

Initial Jobless Claims U.S.

WHEN: 02nd June 2022                                                    WHAT IT HAD INFLUENCED: 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.

USD/CHF is trading in an upward channel. Further upside movement can be seen in the coming weeks.

CPI (YoY) (May), Eurozone

WHEN: 31st May 2022                                                   WHAT IT HAD INFLUENCED: EUR 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. 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.

EUR/USD is trading in an upward channel. Further upside movement can be seen in the coming weeks.

GDP (MoM) (Mar), Canada

WHEN: 31st May 2022                                                   WHAT IT HAD INFLUENCED: CAD and its subsequent pairs.

WHAT HAPPENED: 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.

CAD/JPY is trading in an upward channel. Further upside movement can be seen in the coming weeks.

GDP (QoQ) (Q1), Australia

WHEN: 01st June 2022                                                   WHAT IT HAD INFLUENCED: AUD and its subsequent pairs.

WHAT HAPPENED: Gross Domestic Product (GDP) gauges the inflation-adjusted value of all goods and services produced within the economy. It is the most comprehensive measure of economic activity and an important indicator of economic health. 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.

AUD/USD is trading in an upward channel. Further upside movement can be seen in the coming weeks

Gold on back foot as US yields hang on to gains

WHAT IT HAD INFLUENCED:

GOLD

WHAT HAPPENED:   Gold prices are consolidating this week’s rebound to one-month highs above $1,870 on Friday, as bulls take a breather amid mixed markets. A sense of caution prevails, in the face of the recent series of disappointing US economic data, which ahs tempered the Fed tightening expectations.

Gold prices erased a portion of its weekly gains on Friday as US Treasury bond yields gained traction on the better-than-expected labor market data. The benchmark 10-year US Treasury bond yield pushed higher toward 3% with the initial reaction to the upbeat job report and caused gold prices to turn south following the two-day rally. The US Treasury yields are stabilizing after the previous retreat, capping the upside in the yellow metal. Traders, this week, refrained from taking any directional bets on Gold as they await the critical US NFP data for fresh trading. 

The immediate support and resistance level is seen at $1840 and $1880 respectively.

GOLD is trading in an upward channel. Further upside movement can be seen in the coming weeks

Crude oil closed higher for the second consecutive week above $115 per barrel.

WHAT IT HAD INFLUENCED:

WTI CRUDE OIL

WHAT HAPPENED: Crude oil prices closed higher this week, gaining around 3.30%. It closed this week around the $115 – level, a 12-week high. Oil prices witnessed a volatile session this week, with the first half of the week registering a bearish tone and the second half a bullish tone.

Oil settled higher on Friday, supported by expectations that OPEC’s decision to increase production targets by slightly more than planned will not add that much global supply which should tighten as China eases COVID restrictions. The OPEC+, on Thursday, agreed to boost output by 684,000 barrels per day (bpd) a month in July and August rather than 432,000 bpd as previously agreed. The demand for crude oil is rising too. China’s financial hub Shanghai and capital, Beijing, have relaxed COVI-19 restrictions and the Chinese government has vowed to stimulate the economy. Oil held gains after U.S. data showed employment increased more than expected in May, signs of a tight labor market.

The immediate support and resistance are seen at the $110 and $120 – levels.

WTI Crude oil is trading in an upward channel. Further upside is seen in the coming weeks.

Bitcoin battles for $30K, seeks first weekly candle in 9 weeks

WHAT IT HAD INFLUENCED:

BITCOIN

WHAT HAPPENED: Bitcoin price has been consolidating since the May 12 crash and has stayed relatively flat from a macro standpoint. This consolidation could be preparing for a wild volatile move that will shock investors.

Bitcoin has seen nine consecutive down weekly candlesticks with no recovery rallies. Moreover, Bitcoin price has crashed 45% since March 28 and shows no signs of a relief trend. This may indicate that the downswing is overextended and that a minor bounce seems likely. 

Although a relief rally to $35,000 might seem possible, the bearish macro trend seems to be firmly placed. Supporting thus macro bearish trend for Bitcoin price is the net exchange position change. This index tracks the number of BTC flows to exchanges and can serve as an indicator of investor sentiment and can also forecast the chances of a sell-off.

The immediate support and resistance are seen at $27,500 and $30,650 – levels.

BTCUSD is trading within a rectangle. There is possibility of either a breakdown or a breakout occurring in the coming weeks.

5 KEY EVENTS TO WATCH OUT

Construction PMI (May), U.K.

WHEN: 08th June 2022                                                   WHAT IT HAD INFLUENCED: GBP and its subsequent pairs.

WHAT’S HAPPENING: The Chartered Institute of Purchasing and Supply (CIPS) Construction Purchasing Manager’s Index (PMI) is a diffusion index incorporating survey results provided by construction firms throughout the country. A reading above fifty suggests the construction sector is expanding, while a reading below fifty suggests the construction sector is in contraction. 

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

Core CPI (MoM) (May), U.S.

WHEN: 10th June 2022                                                   WHAT IT HAD INFLUENCED: USD and its subsequent pairs.

WHAT’S HAPPENING:  The Core Consumer Price Index (CPI) measures the changes in the price of goods and services, excluding food and energy. The Central bank pays very close attention to this figure in its role of maintaining price stability. Because the Fed believes that core inflation is a better gauge of underlying price pressures, it is more closely watched than overall inflation which tends to be more volatile.

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.

GDP (QoQ) (Q1), Eurozone

WHEN: 08th June 2022                                                   WHAT IT HAD INFLUENCED: EUR and its subsequent pairs.

WHAT’S HAPPENING: Gross Domestic Product (GDP) gauges the inflation-adjusted value of all goods and services produced within the economy. It is the most comprehensive measure of economic activity and an important indicator of economic health.

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.

Employment Change (May), Canada

WHEN: 10th June 2022                                                   WHAT IT HAD INFLUENCED: CAD and its subsequent pairs.

WHAT’S HAPPENING: Employment Change reports the change in the number of people employed versus the prior month. Job creation is an important indicator of consumer spending.

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.

RBA Interest Rate Decision (Jun), Australia

WHEN: 07th June 2022                                                   WHAT IT HAD INFLUENCED: 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 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

1. DocuSign (DOCU) is expected to announce its quarterly result on 06th June 2022, EPS is estimated to be $0.4637 per share while revenue is forecasted to be 582.91M.

2. JM Smucker (SJM) is expected to announce its quarterly result on 07th June 2022, EPS is estimated to be $1.88 per share while revenue is forecasted to be 1.98B.

3. Brown Forman (BFb) is expected to announce its quarterly result on 08th June 2022, EPS is estimated to be $0.2709 per share while revenue is forecasted to be 31.09B.

4. Campbell Soup (CPB) is expected to announce its quarterly result on 08th June 2022, EPS is estimated to be $0.6134 per share while revenue is forecasted to be 13.8B.

5. Vail Resorts (MTN) is expected to announce its quarterly result on 09th June 2022, EPS is estimated to be $8.98 per share while revenue is forecasted to be 10.44B.

TOP COMMODITIES IN THE COMING WEEK

GOLD

GOLD is trading in an upward channel. Further upside movement can be seen in the coming weeks.

SILVER

SILVER is trading in an upward channel. Further upside movement can be seen in the coming weeks.

WTI CRUDE OIL

WTI CRUDE OIL is trading in an upward channel. Further upside is seen in the coming weeks.

TOP CRYPTO IN THE COMING WEEK

BTCUSD

BTCUSD is trading within a rectangle. There is possibility of either a breakdown or a breakout occurring in the coming weeks.

ETHEREUM

ETHEREUM is trading in a downward channel. Further downside movement can be seen in the coming weeks.

TOP CURRENCY IN THE COMING WEEK

EURUSD

EUR/USD is trading in an upward channel. Further upside movement can be seen in the coming weeks.

GBPUSD

GBP/USD is trading in an upward channel. Further upside movement can be seen in the coming weeks.

EURJPY

EUR/JPY is trading in an upward channel. Further upside movement can be seen in the coming weeks.

TOP INDEX IN THE COMING WEEK

NASDAQ 100

NASDAQ 100 is trading in an upward channel. Further upside can be seen in the coming weeks.

S&P 500

S&P 500 is trading in an upward channel. Further upside can be seen in the coming weeks.

DATA WATCH

TimeCurrencyEventForecastPrevious
Tuesday, June 07, 2022    
10:00AUDRBA Interest Rate Decision (Jun)0.60%0.35%
10:00AUDRBA Rate Statement
14:00GBP Composite PMI (May)51.851.8
14:00GBP Services PMI (May)51.851.8
19:30CADIvey PMI (May)66.3
Wednesday, June 08, 2022    
05:20JPYGDP (QoQ) (Q1)-0.30%-0.20%
14:00GBP Construction PMI (May)58.0058.20
14:30EURGDP (QoQ) (Q1)0.30%0.30%
20:30USDCrude Oil Inventories-5.068M
Thursday, June 09, 2022    
17:15EURDeposit Facility Rate (Jun)-0.50%-0.50%
17:15EURECB Interest Rate Decision (Jun)0.00%0.00%
17:15EURECB Marginal Lending Facility
17:15EURECB Monetary Policy Statement 
18:00EURECB Press Conference 
18:00USDInitial Jobless Claims200K
Friday, June 10, 2022    
18:00CADEmployment Change (May)24.0K15.3K
18:00USDCore CPI (MoM) (May)0.50%0.60%

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