Weekly Technical Analysis with Candlestick Charts – 22 May 2022

Weekly Technical Analysis with Candlestick Charts – 22 May 2022

Technical Analysis

WEEKLY SNAPSHOT

CPI (YoY) (Apr), U.K.

WHEN: 18th May 2022                                                   WHAT IT HAD INFLUENCED: GBP 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 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: 19th May 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 below its previous upward channel.  Further downside movement can be seen in the coming weeks.

CPI (YoY) (Apr), Eurozone

WHEN: 18th 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.

Core CPI (MoM) (Apr), Canada

WHEN: 18th May 2022                                                   WHAT IT HAD INFLUENCED: CAD and its subsequent pairs.

WHAT HAPPENED: The Core Consumer Price Index (CPI) measures the change 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, as it excludes the volatile food and energy components. 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 a downward channel.  Further downside movement can be seen in the coming weeks.

Employment Change (Apr), Australia

WHEN: 19th May 2022                                                   WHAT IT HAD INFLUENCED: AUD and its subsequent pairs.

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 prices rose this week, ending a four-week bearish streak

WHAT IT HAD INFLUENCED:

GOLD

WHAT HAPPENED:   Gold prices end higher this week, climbing around 1.8%, after four consecutive bearish weeks. Prices, this week, was able to close above the $1820- level after closing below it last week.

Gold prices made gains this week for the first time since mid-April. Prices began to capitalize on the pullback in yields and the softening dollar. The dollar is headed for the worst week since mid-February. Benchmark yields move lower, this week. The ten-year yield lowered by 2 bps. Stocks faced declines amid investors’ worries over a potential recession. As investors’ fears about slowing economic growth and recession gradually grew, the yellow-metal soar as investors flock to the safe haven. The softening dollar and increasing gold prices signal investors’ fears about the direction of the market. The dollar was lifted amid geopolitical uncertainty as a safe haven, but treasury yields adjusting for inflation led to weakness in the dollar.

The immediate support and resistance level is seen at $1820 and $1860 respectively.

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

Crude oil stabilizes around $110, end the week flat.

WHAT IT HAD INFLUENCED:

WTI CRUDE OIL

WHAT HAPPENED: Crude oil prices were up on Friday, closing the week on a small weekly gain, but a gain nevertheless of four weeks in a row. Oil had a very volatile week as bearish and bullish market forces pulled prices in both directions. Concerns about a global economic slowdown and even a recession spooked investors and speculators in the middle of the week, and oil joined in on the massive sell-off in equities on the Wall Street on Wednesday. Fears of a recession, with analysts saying the odds are rising, prompted market participants to pull out of many risky assets, including crude oil futures.

On the bullish side, China has signalled a tentative reopening in Shanghai from June 1, despite finding on Friday five new COVID cases outside quarantined areas in the city. Low U.S. fuel inventories last week week supported oil prices, and will continue to do so, analysts say, as supply will struggle to catch up with higher demand in the summer.

The immediate support and resistance are seen at the $107 and $115 – levels.

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

Bitcoin entrenched at $30,000 – level.

WHAT IT HAD INFLUENCED:

BITCOIN

WHAT HAPPENED: Bitcoin price suffered a massive decline in the recent bloodbath. BTC price plummeted below $30,000, a key psychological barrier for the asset. With Bitcoin’s consistent decline, proponents have noted that the current 8-week fall is the first of its kind in the asset’s history. 

Bitcoin price is sticking close to a range that extends from $29,720 to $32,671. These barriers were set up on May 10, before BTC crashed to $25,333. Since then, BTC has been struggling to move higher and is grappling with the range low. The Fear and Greed Index held steady at 13/100 on Friday, up from Tuesday’s 8/10 reading “Extreme Fear” zone, reflecting the bearish sentiment across the crypto market.

The immediate support and resistance are seen at $25,350 and $32,820 – 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

Public Sector Net Borrowing (Apr), U.K.

WHEN: 24th May 2022                                                   WHAT IT HAD INFLUENCED: GBP and its subsequent pairs.

WHAT’S HAPPENING: Public Sector Net Borrowing measures the difference between spending and income for public corporations, the central government, and local governments during the prior month.

A positive number indicates a budget deficit, while a negative number indicates a surplus.

GDP (QoQ) (Q1), U.S.

WHEN: 26th May 2022                                                   WHAT IT HAD INFLUENCED: USD and its subsequent pairs.

WHAT’S HAPPENING:  Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measures of economic activity and the primary indicator of the economy’s health.

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

German GDP (QoQ) (Q1), Eurozone

WHEN: 25th May 2022                                                   WHAT IT HAD INFLUENCED: EUR and its subsequent pairs.

WHAT’S HAPPENING: Gross Domestic Product (GDP) is the broadest measure of economic activity and is a key indicator of economic health. The quarterly percent changes in GDP show the growth rate of the economy as a whole.

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 Retail Sales (MoM) (Mar), Canada

WHEN: 26th May 2022                                                   WHAT IT HAD INFLUENCED: CAD and its subsequent pairs.

WHAT’S HAPPENING: Retail Sales gauges the change in the aggregate value of sales at the retail level across the country (excluding automobile sales). 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 CAD, while a weaker than forecast reading is generally negative (bearish) for the CAD.

Retail Sales (MoM) (Apr), Australia

WHEN: 27th May 2022                                                   WHAT IT HAD INFLUENCED: AUD and its subsequent pairs.

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. Intuit (INTU) is expected to announce its quarterly result on 24th May 2022, EPS is estimated to be $7.58 per share while revenue is forecasted to be 5.51B.

2. NetEase (NTES) is expected to announce its quarterly result on 24th May 2022, EPS is estimated to be $7.21 per share while revenue is forecasted to be 22.9B.

3. NVIDIA (NVDA) is expected to announce its quarterly result on 25th May 2022, EPS is estimated to be $1.3 per share while revenue is forecasted to be 8.12B.

4. Medtronic (MDT) is expected to announce its quarterly result on 26th May 2022, EPS is estimated to be 1.57 per share while revenue is forecasted to be 8.44B.

5. Dollar General (DG) is expected to announce its quarterly result on 26th May 2022, EPS is estimated to be $2.35 per share while revenue is forecasted to be 8.7B.

TOP COMMODITIES IN THE COMING WEEK

GOLD

Technical Analysis

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

SILVER

Technical Analysis

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

WTICRUDE OIL

Technical Analysis

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

TOP CRYPTO IN THE COMING WEEK

BTCUSD

Technical Analysis

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

ETHEREUM

Technical Analysis

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

TOP CURRENCY IN THE COMING WEEK

EURUSD

Technical Analysis

EURUSD is trading in an upward channel. Further upside is seen in the coming weeks.

GBPUSD

Technical Analysis

GBPUSD is trading in an upward channel. Further upside is seen in the coming weeks.

EURJPY

Technical Analysis

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

S&P 500

Technical Analysis

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

DATA WATCH

TimeCurrencyEventForecastPrevious
Tuesday, May 24, 2022    
11:30GBPPublic Sector Net Borrowing (Apr)17.32B
13:00EURGerman Manufacturing PMI (May)5454.6
19:30USDNew Home Sales (Apr)758K763K
Wednesday, May 25, 2022    
11:30EURGerman GDP (QoQ) (Q1)0.20%0.20%
18:00USDCore Durable Goods Orders (MoM) (Apr)0.60%1.40%
23:30USDFOMC Meeting Minutes
Thursday, May 26, 2022    
18:00USDGDP (QoQ) (Q1)-1.4%-1.4%
18:00CADCore Retail Sales (MoM) (Mar)2.10%
19:30USDPending Home Sales (MoM) (Apr)-1.60%-4.1%
Friday, May 27, 2022    
07:00AUDRetail Sales (MoM) (Apr)0.60%1.60%

About Author