Weekly Technical Analysis with Candlestick Charts – 24 April 2022

Weekly Technical Analysis with Candlestick Charts – 24 April 2022

Technical Analysis

WEEKLY SNAPSHOT

Manufacturing PMI U.K.

WHEN: 22nd April 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.

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

Initial Jobless Claims, U.S.

WHEN: 21st April 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 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.

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

CPI (YoY) (Mar), Eurozone

WHEN: 21st April 2022                                                   WHAT IT HAD INFLUENCED: EUR and its subsequent pairs.

WHAT HAPPENED: 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.

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

Core CPI (MoM) (Mar), Canada

WHEN: 20th April 2022                                                   WHAT IT HAD INFLUENCED: CAD and its subsequent pairs.

WHAT HAPPENED: 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.

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

Retail Sales (MoM) (Mar), Australia

WHEN: 21st April 2022                                                   WHAT IT HAD INFLUENCED: AUD and its subsequent pairs.

WHAT HAPPENED: 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.

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

Gold declines on hawkish Fed comments

WHAT IT HAD INFLUENCED:

GOLD

WHAT HAPPENED: Gold prices fell this week on the narrative of an increasingly hawkish Fed, a strong dollar, and rising US treasury yields. While no progress on the Russia-Ukraine peace talk provided support. 

Gold started the week on a bullish note and reached its highest level in more than a month near $2,000 on Monday. However, its inability to break above the $2,000 – mark invited bears this week. Thin trading conditions on Easter Monday allowed gold to rise toward $2,000. The greenback, however, managed to hold its ground and made it difficult for gold to push higher. 

The potential for a 50-bps rate hike in May with two follow-up 75-bps rate hikes in June and July isn’t good for gold. Gold’s demand, despite its hedging appeal in inflationary times, would be dented as the opportunity cost of non-yielding assets like gold would go up.

In the coming weeks, the nearest support and resistance are seen at $1915 and $1975 respectively. A break below $1915 would test the psychological $1900 mark and March’s low of $1890.

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

Crude oil prices decline on revised IMF forecasts 

WHAT IT HAD INFLUENCED:

WTI CRUDE OIL

WHAT HAPPENED: Chicago WTI crude oil futures dropped around 5% this week. The market remains volatile as supply disruptions from Libya and Russia are currently being offset by the release from the Strategic Petroleum Reserve (SPR) and lower demands in China where authorities are struggling to contain and eradicate a wave of Covid-19 in major cities.

The Energy Information Activity (EIA) informed on Wednesday reported an 8-million-barrel reduction in crude oil stocks for the week ending April 15. The EIA data also revealed another high-profile headline: US oil and petroleum exports hit the highest level on record last week. 

Hawkish Fed’s comments and upcoming aggressive tightening mode to curb inflation will likely reduce growth and therefore, crude oil demand. However, with the war in Ukraine ongoing and the risk of additional sanctions or actions on Russia, the downside risk to oil remains limited. 

WTI crude oil futures is trading within a descending triangle. So, there is a possibility of a breakdown occurring in the coming weeks.

Bitcoin’s upward push lose momentum after Fed comments.

WHAT IT HAD INFLUENCED:

BITCOIN

WHAT HAPPENED: Bitcoin dipped below $40,000 on early Saturday trades. Choppy trading conditions indicate uncertainty among traders, especially as macroeconomic and geopolitical risks linger. 

Jerome Powell, the chair of the Federal Reserve, indicated that a raise of 50-bps “will be on the table” at the next Federal Open Market Committee (FOMC) meeting. Historically, tighter monetary policy measures have increased selling pressure on cryptocurrencies as investors pull out from speculative and highly volatile markets. 

Bitcoin price is below the 600-day SMA. the last close below the 600-day SMA was on 21 April 2020, around two years ago.

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

5 KEY EVENTS TO WATCH OUT

Nationwide HPI (MoM) (Apr), U.K.

WHEN: 29th April 2022                                                   WHAT IT HAD INFLUENCED: GBP and its subsequent pairs.

WHAT’S HAPPENING: The Nationwide Housing Price Index (HPI) is the U.K.’s second earliest report on house prices. It measures the change in the selling price of homes with mortgages backed by Nationwide.

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.

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

WHEN: 28th April 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 measure of economic activity and the primary indicator of the economy’s health. 

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) (Apr), Eurozone

WHEN: 29TH April 2022                                                   WHAT IT HAD INFLUENCED: EUR and its subsequent pairs.

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.

GDP (MoM) (Feb), Canada

WHEN: 29th April 2022                                                   WHAT IT HAD INFLUENCED: CAD 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 measure 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 CAD, while a weaker than forecast reading is generally negative (bearish) for the CAD.

CPI (QoQ) (Q1), Australia.

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

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 AUD, while a weaker than forecast reading is generally negative (bearish) for the AUD.

EQUITIES IN THE COMING WEEK

1. Coca – Cola (KO) to announce its quarterly result on 25th April 2022, EPS is estimated to be $0.57 per share while revenue is forecasted to be 9.83B.

2. Microsoft (MSFT) to announce its quarterly result on 26th April 2022, EPS is estimated to be $2.19 per share while revenue is forecasted to be 2.07T.

3. Alphabet A (GOOGL) to announce its quarterly result on 26th April 2022, EPS is estimated to be $25.9 per share while revenue is forecasted to be 1.58T.

4. Meta Platforms (FB) to announce its quarterly result on 27th April 2022, EPS is estimated to be $2.57 per share while revenue is forecasted to be 500.83 B

5. Apple (AAPL) to announce its quarterly result on 28th April 2022, EPS is estimated to be $1.43 per share while revenue is forecasted to be 2.67T.

TOP COMMODITIES IN THE COMING WEEK

GOLD

Technical Analysis

GOLD was trading in an upward channel. Currently, it is trading outside and below its previous upward channel so, further downside is seen in the coming weeks.

SILVER

Technical Analysis

SILVER was trading in an upward channel but currently it is trading outside and below its previous upward channel. So, further downside is seen in the coming weeks.

WTI CRUDE OIL

Technical Analysis

WTI Crude Oil is trading within a descending triangle with the potential of a breakdown occurring. Further downside is seen in the coming weeks.

TOP CRYPTO IN THE COMING WEEK

BTCUSD

Technical Analysis

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

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 weeks.

GBPUSD

Technical Analysis

GBPUSD has broken down below its previous downward channel, so further downside is seen in the coming weeks.

EURJPY

Technical Analysis

EURJPY is trading in an upward channel. Further upside 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 week.

S&P 500

Technical Analysis

S&P 500 has further broken down below its previous downward channel. So, further downside is seen in the coming weeks.

DATA WATCH

TimeCurrencyEventForecastPrevious
Tuesday, April 26, 2022    
18:00USDCore Durable Goods Orders (MoM) (Apr)0.60%-0.60%
19:30USDCB Consumer Confidence (Apr)108107.2
19:30USDNew Home Sales (Mar)765K772K
Wednesday, April 27, 2022    
07:00AUDCPI (QoQ) (Q1)1.70%1.30%
19:30USD Pending Home Sales (MoM) (Mar)-1.50%-4.10%
20:00USDCrude Oil Inventories2.471M-8.020M
Thursday, April 28, 2022    
07:00AUDRetail Sales (MoM) (Mar)1.00%1.80%
18:00USDGDP (QoQ) (Q1)1.10%6.90%
18:00USDInitial Jobless Claims184K
Friday, April 29, 2022    
11:30GBPNationwide HPI (MoM) (Apr)1.10%
13:30EURGerman GDP (QoQ) (Q1)0.20%-0.30%
14:30EURCPI (YoY) (Apr)7.40%7.40%
18:00CADGDP (MoM) (Feb)0.80%0.20%

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