Weekly Technical Analysis with Candlestick Charts – 11 April 2022

Weekly Technical Analysis with Candlestick Charts – 11 April 2022

Technical Analysis

WEEKLY SNAPSHOT

Construction PMI (Mar), U.K.

Technical Analysis

WHAT HAPPENED: The 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 that the construction sector is expanding, while a reading below fifty suggests contraction.

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

Initial Jobless Claims, U.S.

Technical Analysis

WHAT HAPPENED: Initial jobless claims measure the number of people who filed for unemployment insurance for the first time during the past week. A higher reading than forecast is generally negative/bearish for the USD, while a lower than forecast reading is usually supportive/bullish for the USD.

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

Employment Change (Mar), Canada

Technical Analysis

WHAT HAPPENED: Employment change reports changes in the number of people employed versus the prior month. Job creation is an important indicator of consumer spending. A stronger reading than the forecast is generally supportive/bullish for the CAD, while a weaker 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.

Retail Sales (MoM), Australia

Technical Analysis

WHAT HAPPENED: Retail sales gauge 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 overall economic activity. A stronger reading than the forecast is generally supportive/bullish for the AUD, while a weaker forecast reading is generally negative/bearish.

AUD/USD is trading in a downward channel. Further downside can be seen in the coming weeks.

Gold pushes to $1945 despite rising U.S. treasury yields

WHAT IT HAD INFLUENCED:

GOLD

WHAT HAPPENED: Gold prices this week witnessed a gain of around 0.6%, closing at $1945, pushing to fresh weekly highs. This is despite a strong dollar and rising U.S. treasury yields.

The global economy suffers from high inflationary pressure due to the COVID-19 pandemic, loose monetary policies, etc. This unprecedented level is exacerbated by the ongoing conflict in Ukraine, which has disrupted the global food and energy supply chain and contributed to rising inflationary pressure. With the Fed aggressively trying to reign in inflation, the probability of the economy heading into a recession as a result of policy misstep is heightened.

The global economy heading into a recession or the rising inflation will have an enormous impact on economies worldwide. It will continue to be highly supportive of safe-haven assets such as gold. 

Gold is trading within a rectangle. So, there is a potential for a breakout or a breakdown.

WTI Crude Oil settles below the $100-mark

WHAT IT HAD INFLUENCED:

WTI CRUDE OIL

WHAT HAPPENED: Chicago WTI Crude oil price closed below $100 this week, declining around 4.5%. WTI Crude oil witnessed two bullish sessions this week. This week, oil prices remain volatile amid concerns over Russian supply against the backdrop of slowing demand in China and likely depressed U.S. summer demands due to higher prices at the pump.

These four major factors will influence the price of crude oil in the coming weeks:1) E.U. sanction on Russian energy exports, 2) China’s worsening COVID outbreak and extended lockdowns, 3) Declining U.S. gasoline demands in response to high prices and the prospect of an economic slowdown as the Fed hike interest rates, thereby hurting demand, and 4) Releases of strategic oil reserves by the U.S. and other members of the International Energy Agency (IEA).

WTI Crude oil is trading within a descending triangle, so there is a potential for a breakdown in the coming weeks.

Bitcoin witnessed a bearish week, settling below the ominous $45,000 

WHAT IT HAD INFLUENCED:

BITCOIN

WHAT HAPPENED: Earlier, bitcoin prices continued to head higher after breaching a massive hurdle, but it has retraced its gain back to the $43,000 mark over the last three days, dropping around 8.5% this week.

After gaining over 25% in March, bitcoin faced strong resistance at the $47,500 mark. For almost a week, from March 29 to April   5, BTC oscillated just under the critical $47,470 resistance level and dipped nearly 10% in the following days.

BTCUSD is trading below its previous upward channel. There is a potential for a further decline in the coming weeks.

5 KEY EVENTS TO WATCH OUT

GDP (YoY), U.K.

Technical Analysis

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

A higher-than-expected reading should be taken as a positive/bullish sign for the GBP, while a lower-than-expected reading should be taken as a negative/bearish sign.

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

Technical Analysis

WHAT’S HAPPENING:  The Core Consumer Price (CPI) measures the changes in the prices of goods and services, excluding food and energy. The central bank pays very close attention to this figure to maintain price stability.

A stronger reading than forecast is generally positive/ bullish for the USD, while a weaker than forecast reading is generally negative/bearish for the USD.

ECB Interest Rate Decision, Eurozone

Technical Analysis

WHAT’S HAPPENING: The European Central Bank publishes 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 positive/bullish for the EUR, while a weaker than forecast reading is generally negative/bearish for the EUR.

BoC Interest Rate Decision, Canada

Technical Analysis

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 important determinant of currency valuation, traders watch interest rate changes closely.

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

Employment Change (Mar), Australia.

Technical Analysis

WHAT’S HAPPENING: Employment Change reports the change in the number of people employed across Australia. Jobs and the income they generate is an important factor in consumer spending.

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. JPMorgan (JPM) to announce its quarterly result on April 13 2022, EPS is estimated to be $2.75 per share while revenue is forecasted to be 30.76B.

2. BlackRock (BLK) to announce its quarterly result on April 13 2022, EPS is estimated to be $9.15 per share while revenue is forecasted to be 4.77B.

3. UnitedHealth (UNH) to announce its quarterly result on April 14 2022, EPS is estimated to be $5.35 per share while revenue is forecasted to be 78.65B.

4. Taiwan Semiconductor (TSM) to announce its quarterly result on April 14 2022, EPS is estimated to be $1.28 per share while revenue is forecasted to be 16.8B.

5. Morgan Stanley (M.S.) to announce its quarterly result on April 14 2022, EPS is estimated to be $1.87 per share while revenue is forecasted to be 14.82B.

TOP COMMODITIES IN THE COMING WEEK

GOLD

Technical Analysis

Gold is trading within a rectangle. There is a possibility for both breakout and breakdown in the coming weeks.

SILVER

Technical Analysis

SILVER was trading in an upward channel but has broken down below its previous upward channel. Further downside is seen in the coming weeks.

WTI CRUDE OIL

Technical Analysis

WTI CRUDE OIL is trading within a descending triangle. There is a strong probability of a breakdown happening in the coming weeks.

TOP CRYPTOS IN THE COMING WEEK

BTCUSD

Technical Analysis

BTCUSD is trading below its previous upward channel. Further downside is seen in the coming weeks.

ETHEREUM

Technical Analysis

ETHEREUM is trading below its previous upward channel. Further downside is seen in the coming weeks.

TOP CURRENCY IN THE COMING WEEK

EURUSD

Technical Analysis

EURUSD is trading in a downward channel. Further downside is seen in the coming weeks.

GBPUSD

Technical Analysis

GBPUSD is trading in a downward channel. Further downside is seen in the coming weeks.

EURJPY

Technical Analysis

EURJPY is trading outside its previous upward channel. Further downside is seen in the coming weeks.

TOP INDEX IN THE COMING WEEK

NASDAQ 100

Technical Analysis

NASDAQ 100 is trading below its previous upward channel. Further downside is seen in the coming weeks.

S&P 500

Technical Analysis

S&P 500 is trading below its previous upward channel. Further downside is seen in the coming weeks.

DATA WATCH

TimeCurrencyEventForecastPrevious
Monday, April 11, 2022    
11:30GBPManufacturing Production (MoM) (Feb)0.30%0.80%
11:30GBPGDP (MoM)0.80%
11:30GBPGDP (YoY)6.60%
Tuesday, April 12, 2022    
11:30GBPAverage Earnings Index + Bonus (Feb)5.40%4.80%
11:30GBPClaimant Count Change (Mar)– 4.81K
14:30EURGerman ZEW Economic Sentiment (Apr)-48-39.3
18:00USDCore CPI (MoM) (Mar)0.50%0.50%
Wednesday, April 13, 2022    
11:30GBPCPI (YoY) (Mar)6.70%6.20%
18:00USDPMI (MoM) (Mar)1.10%0.80%
19:30CADBoC Interest Rate Decision1.00%0.50%
Thursday, April 14, 2022    
07:00AUDEmployment Change (Mar)40.0K77.4K
17:15EURDeposit Facility Rate (Apr)-0.50%-0.50%
17:15EURECB Interest Rate Decision (Apr)
18:15EURECB Marginal Lending Facility
18:00USDCore Retail Sales (MoM) (Mar)0.90%0.20%
18:00USDRetail Sales (MoM) (Mar)0.60%0.30%
18:00USDInitial Jobless Claims166K

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