Weekly Technical Analysis with Candlestick Charts – 17 April 2022

Weekly Technical Analysis with Candlestick Charts – 17 April 2022

Technical Analysis

WEEKLY SNAPSHOT

GDP (YoY) U.K.

Technical Analysis

WHAT HAPPENED: 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.

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

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

Technical Analysis

WHAT HAPPENED: The Core Consumer Price (CPI) measures the changes in the prices of goods and services, excluding food and energy. The central bank pays 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.

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

ECB Interest Rate Decision, Eurozone

Technical Analysis

WHAT HAPPENED: 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.

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

BoC Interest Rate Decision, Canada

Technical Analysis

WHAT HAPPENED: 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.

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

Employment Change (Mar), Australia

Technical Analysis

WHAT HAPPENED: 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.

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

Gold ends in bullish territory this week amid rising U.S. treasury yields and record-inflation

WHAT IT HAD INFLUENCED:

GOLD

WHAT HAPPENED: Gold price this week rallied to positive territory for the second consecutive week. It closed above the $1970 level as safe-haven flows dominated the markets amid inflation fears and geopolitical tensions.

Gold started solid this week, but its early gains were erased, ending negatively on Monday. The negative shift witnessed in risk sentiment on Tuesday boosted the yellow metal. Fading hope of a peace agreement between Russia and Ukraine, the ongoing coronavirus-related lockdowns in China, and inflation fears forced investors to seek refuge in the bullion. 

In the coming weeks, the nearest resistance and support are seen at $1985 and $1960, respectively. The $2000-mark will serve as a strong psychological barrier to gold’s further upside.

Gold is trading in an upward channel until there is a trend reversal. 

Oil prices soar on supply shortages and as Hong Kong eases restriction

WHAT IT HAD INFLUENCED:

WTI CRUDE OIL

WHAT HAPPENED: Price of Chicago WTI Crude oil futures rose around 8.5% this week, recovering the loss sustained the previous week. Rise of oil prices came as no surprise with global supply shortages outweighing concerns about slower demand in China.

Major international trading houses have announced that they are planning to cut purchases of Russian crude and oil products starting mid-May, following the EU’s sanctions on Russia’s financial activities. With the OPEC not increasing its production cap and failing to meet its present production target, it will be hard to find replacement to Russian energy exports in the near future. 

Hong Kong confirmed on Thursday that it would ease some of the world’s most stringent Covid restrictions, allowing beauty parlors, cinemas, and gyms to reopen from April 21 as infections in the global financial hub hover below 2,000 per day. This could lead to an easing of Covid restrictions on the mainland China, which would be followed by increased demand for Crude oil.

WTI Crude oil is trading in an upward channel until there is a trend reversal.

Bitcoin reclaims $40,000 as sentiment shifts to “Extreme Fear.”

WHAT IT HAD INFLUENCED:

BITCOIN

WHAT HAPPENED: Bitcoin ended this week negatively like its previous week, showing uncertainty among market participants. It closed below the $42,000-mark. The cryptocurrency fear and greed index returned to the extreme fear territory, losing 6 points to 22, by Friday. 

Bitcoin is trading near the $40,000 support level, which runs through the lows of January, February, and March. A breakdown below $38,000 will be considered a transition to a bearish market. While a reversal to the uptrend from this level will reinforce the importance of this moderate uptrend line.

Bitcoin is trading in a downward channel until there is a trend reversal.

5 KEY EVENTS TO WATCH OUT

Manufacturing PMI, U.K.

Technical Analysis

WHAT’S HAPPENING: 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.

Initial Jobless Claims, U.S.

Technical Analysis

WHAT’S HAPPENING:  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 reader 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.

CPI (YoY) (Mar), Eurozone

Technical Analysis

WHAT’S HAPPENING: The Consumer Price Index (CPI) measures the changes 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.

Core CPI (MoM) (Mar), Canada

Technical Analysis

WHAT’S HAPPENING: The Core Consumer Price Index (CPI) measures the changes in the prices of goods and services from the perspective of the consumer (excluding food and energy). 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 CAD, while a weaker than forecast reading is generally negative (bearish) for the CAD.

Retail Sales (MoM) (Mar), Australia.

Technical Analysis

WHAT’S HAPPENING: 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 the majority of overall economic activity.

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. Bank of America (BAC) to announce its quarterly result on April 18 2022, EPS is estimated to be $0.7492 per share while revenue is forecasted to be 23.18B.

2. Johnson & Johnson (JNJ) to announce its quarterly result on 19 April 2022, EPS is estimated to be $2.59 per share while revenue is forecasted to be 23.69B.

3. Tesla (TSLA) to announce its quarterly result on 20 April 2022, EPS is estimated to $2.24 per share while revenue is forecasted to be 17.63B.

4. Procter & Gamble (PG) to announce its quarterly result on 20 April 2022, EPS is estimated to be $1.3 per share while revenue is forecasted to be 18.72B.

5. Verizon (VZ) to announce its quarterly result on 22 April 2022, EPS is estimated to be $1.35 per share while revenue is forecasted to be 33.4B.

TOP COMMODITIES IN THE COMING WEEK

GOLD

Technical Analysis

GOLD is trading in an upward channel. Further upside is seen in the coming week.

SILVER

SILVER is trading in an upward channel. Further upside is seen in the coming week.

WTI CRUDE OIL

Technical Analysis

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

TOP CRYPTO IN THE COMING WEEK

BTCUSD

Technical Analysis

BTCUSD is trading in a downward channel. Further downside is seen in the coming week.

ETHEREUM

Technical Analysis

ETHEREUM is trading in a downward channel. Further downside is seen in the coming week.

TOP CURRENCY IN THE COMING WEEK

EURUSD

Technical Analysis

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

GBPUSD

Technical Analysis

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

EURJPY

Technical Analysis

EURJPY is trading in an upward channel. Further upside is seen in the coming week.

TOP INDEX IN THE COMING WEEK

NASDAQ 100

Technical Analysis

NASDAQ 100 is trading in a downward channel. Further downside is seen in the coming week.

S&P 500

Technical Analysis

S&P 500 is trading in a downward channel. Further downside is seen in the coming week.

DATA WATCH

TimeCurrencyEventForecastPrevious
Tuesday, April 19, 2022    
07:00AUDRBA Meeting Minutes
18:00USDBuilding Permits (Mar)1.830M1.865M
Wednesday, April 20, 2022    
18:00CADCore CPI (MoM) (Mar)0.80%
19:30USDExisting Home Sales (Mar)5.80M6.02M
20:00USDCrude Oil Inventories0.863M9.382M
Thursday, April 21, 2022    
07:00AUDRetail Sales (MoM) (Mar)1.00%1.80%
14:30EURCPI (YoY) (Mar)7.50%7.50%
18:00USDPhiladelphia Fed Manufacturing Index (Apr)2027.4
18:00USDInitial Jobless Claims185K
22:00GBPBoE Gov Bailey Speaks
22:30EURECB President Lagarde Speaks
22:30USDFed Chair Powell Speaks
Friday, April 22, 2022    
11:30GBPRetail Sales (MoM) (Mar)-0.30%-0.30%
13:00EURGerman Manufacturing PMI (Apr)54.456.9
14:00GBPServices PMI62.6
14:00GBPManufacturing PMI55.2
18:00CADCore Retail Sales (MoM) (Feb)2.40%2.50%
18:30EURECB President Lagarde Speaks
20:00GBPBoE Gov Bailey Speaks

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