Stuart's FX analysis

# It's hard to find a black cat in a dark room. Especially if it's not there. An attempt by investors to find a dovish reversal in the speech of Federal Reserve Chairman Jerome Powell turned first into the rise of EURUSD, and then the collapse of the currency pair, after traders realized that there was no reversal. Then the market began to look for a positive from the US GDP, which also did not turn out. The US dollar slipped again, but the strong statistics for the eurozone were not enough for the main currency pair to be able to leave the boundaries of the consolidation range of 1.01-1.027. The question is, if inflation reaches a record level of 8.9%, and the economy remains resistant to the tightening of the European Central Bank's monetary policy, why do the money markets reduce the expected increase in the deposit rate by the end of the year from +140 bps after the meeting of the Governing Council to +100 bps? It was investors' distrust of the central bank, or rat...

# In this turbulent year, bulls have little choice. The brighter the American currency broke out into favorites, putting both the euro, the pound, and the yen on the shoulder blades. Nevertheless, if you look at the root of growth, it is noticeable that this growth is not quite normal. This means that as soon as the recession comes to an end, it can lose a lot, failing the entire annual trading plan, even if it previously made a profit on growth. The dollar is not suitable for investors as a safe haven - not anymore It's hard not to agree that, despite all of America's many problems, its currency has arguably been the best investment in the world over the past year, showing a truly epic rally. This is partly due to an unavoidable factor: we are following several of our favorite pairs, and of course the dollar is included there as the world equivalent of commodity transactions. In other words, the US dollar is the "main reserve currency in the world" and the medium ...

# ETHUSD is fighting with the $1700 key price. The technical analysis video shows what can come next Old school technical analysis says that price itself is the most inportant technical indicator. Some claim that the most important part of technical analysis lies in the price itself, as it travels through time. ETH, in terms of technical analysis, is also a potential bear flag. Bear flags extend/continue a downward trend. The bear flag pattern has a powerful downward move followed by an upward consolidation channel. Furthermore, even if we do not have a bear channel, ETHUSD seems to be in a channel, after creating the recent touch point at its upper band. This supports that previously profitable Longs may take partial or full profit, and new bears will open new short positions. The Ethereum technical analysis video shows the 14 day RSI (relative strength indicator) along with its simple moving average and we look for an upcoming crossover that seems to be imminent despite not c...

# The Euro edged just cautiously higher against the US Dollar this past week. This seemed to be largely a result of broad-based weakness in the Greenback, allowing the single currency to capitalize on a depreciating dollar. What fueled this? It appeared to be markets further pricing in a pivot from the Federal Reserve. Are traders getting ahead of themselves, setting up for disappointment? The Euro-Area economic docket is rather thin in the week ahead, so the focus on EUR will likely depend on external factors. In this case, it might make sense to look at what is going on in the United States. Although, it should be noted that the European Central Bank has been pushing out increasingly hawkish commentary as of late. But, as we will see, it still pales in comparison with the Fed. Sentiment recovered this past week, pushing the tech-heavy Nasdaq 100 higher. In July, the index gained about 12.5%, making for the best monthly performance since 2020. This is despite the Fed delivering a 75...

# Most Read: Gold Prices Facing First Topside Hurdle. What’s the Outlook for XAU/USD? Gold prices (XAU/USD) have accelerated their recovery in recent days, rising strongly in the last ten sessions, after bouncing off cluster support at $1,690/$1,675 earlier in the month. This week alone, the precious metal is up more than 3% to trade around $1,780 per troy ounce, supported by a weaker U.S. dollar, but mostly by lower bond rates following the Fed's latest decision and guidance. The July FOMC meeting gave way to a sharp pullback in Treasury yields, with the 2-year yield dropping to its lowest level in nearly a month (2.84%) as comments made by Chair Powell were taken as a signal that peak Fed hawkishness has passed. For context, the central bank chief said another unusually large hike will be data-dependent at his press conference, suggesting that policymakers may slow the pace of the tightening cycle in the future. Although observed CPI has soared to four-decade highs, it is like...

# Bitcoin, Ethereum & Alt-Coins: A Brief History of Crypto Winters Crypto investors have been liking what they've been hearing lately about inflation-busting efforts and the possible economic path forward as bitcoin, ether and most other major digital assets climbed handsomely for a third consecutive day as we approach the weekend. Bitcoin (BTC)was recently trading at nearly $23,900, a more than 4% gain over the past 24 hours as markets continued to embrace the latest steps by the U.S. central bank to quell inflation and indicators showing the economy slowing but not falling into recession. The largest cryptocurrency by market capitalization cracked $24,000 for the first time in more than a week at one point despite US GDP tumbling more steeply than expected. Large institutions have sold at least 236k BTC over the past two months, leading to selling pressure that had pushed the bitcoin price down. The rally since creating the bottom seems to suggest the effects are over for n...

# The Australian Dollar has finished another tumultuous week higher than where it started. Domestic inflation figures followed by the Federal Reserve rate hike and US GDP provided plenty of ammunition for volatility. The RBA will be making a decision on rates this Tuesday. Australian CPI came in not as hot as anticipated and hosed down the prospect of a jumbo hike from the RBA this week. This saw AUD/USD move lower into the Federal Reserve meeting and the 75- bp move from them hit market forecasts. It was the language from Fed Chair Jerome Powell in the aftermath that saw an adjustment lower of future hikes for the Fed. This sent the US Dollar lower and the Aussie higher into US GDP figures that surprised to the downside, further undermining USD and boosting AUD. These three events saw the 3- and 10-year Australian Commonwealth Government bond (ACGB) yields go lower. This could undermine AUD if yields continue to move south. Chart created in TradingView The RBA will be breathi...

# Bitcoin was trading in the red at 23,736 on the H4 at the time of writing. The price climbed as much as 24,445 where it has found resistance. In the short term, it could come back to test and retest the near-term support levels before jumping higher. In the last 24 hours, BTC/USD is down by 1.16% but it's still up by 3.47% in the last 7 days. Technically, after its amazing rally, a minor retreat or an accumulation is natural. BTC/USD Attracts More Buyers! BTC/USD extended its growth and now is located above the upper median line (uml) which represented an upside obstacle. Stabilizing above this broken dynamic resistance may announce further growth. The 24,280 former high represents a static resistance. Also, the R1 (24,331) stands as an upside obstacle. The bias is bullish as long as it stays above the 23,438 today's low. BTC/USD Outlook! Making a valid breakout above 24,280 could activate more gains and could bring long opportunities with a first upside target at 25,4...

# Litecoin dropped after reaching a new higher high of 64.58. Now, it is traded at 61.10 at the time of writing. It has retreated as the price of Bitcoin dropped after its strong growth. The altcoin reached the near-term downside obstacles. It remains to see how it will react around these support levels. Technically, the price action signaled exhausted buyers, we cannot exclude a larger drop in the short term. In the last 24 hours, LTC/USD is down by 3.25% but it's up by 6.96% in the last 7 days. LTC/USD Retests The Buyers! As you can see on the H4 chart, the rate jumped above the inside sliding line (sl) but it has failed to stay above it signaling exhausted buyers. I've told you in my previous analysis that LTC/USD could resume its growth if it validates its breakout above the sliding line. Now, it challenges the 60.44 static support (resistance turned into support). Consolidation above it could announce a new bullish momentum. Dropping below 59.75 today's low could ...

# EUR/USD Range Pattern! The EUR/USD pair was trading at 1.0195 at the time of writing. As you can see on the H1 chart, the price continues to move sideways. It is trapped between the 1.0103 and 1.0265 levels. Personally, I'm expecting the currency pair to extend its sideways movement. Only escaping from this range could bring new trading opportunities. Technically, 1.0265 stands as an upside obstacle while 1.0103 represents a downside obstacle. EUR/USD Trading Conclusion! Jumping and stabilizing above the upside obstacle could bring new buying opportunities as the rate could resume its growth while breaking below 1.0105 could announce more declines. Trading analysis offered by RobotFX and Flex EA . Source #RobotFX Team

# Gold registered a strong upwards movement after stabilizing above the 1,714 level. It has climbed as much as 1,767 where it has found resistance. In the short term, it has retreated and it has retested the 1,752 former resistance (resistance turned into support). The Core PCE Price Index rose by 0.6% exceeding the 0.5% estimates, Revised UoM Consumer Sentiment came in at 51.5 above 51.1 expected, while the Employment Cost Index surged by 1.3% beating the 1.1% growth estimates. In addition, Personal Income and Personal Spending reported better than expected data as well. XAU/USD Trapped Within A Range! XAU/USD is trapped between 1,767 and 1,752 in the short term. A temporary retreat was natural and expected after its strong rally. The bias is bullish as long as the price stays above 1,752. In the short term, the metal could move sideways and it could accumulate more bullish energy before trying to resume its upwards movement. XAU/USD Forecast! A valid breakout above 1,767 could ...

# Overview : Pivot : 1.0188. The Euro strengthened to around the daily pivot point of 1.0188, slightly above the key 1.0100 parity mark after flash reports on growth and inflation topped analysts' estimates reinforcement the case for bigger and faster ECB interest rate hikes - be careful in it and we never advise to trade it at anytime. The EUR/USD pair traded with strong positivity yesterday to test the most important support at the area of 1.0100/1.0097, and bounced bullishly from there to test 1.0188 level now and attempts to breach it, which encourages us to continue suggesting the bullish trend for the upcoming period. Furthermore, the price has been set above the strong support at the level of 1.0188, which coincides with the 50% Fibonacci retracement level. This resistance has been rejected several times confirming the downtrend. The price needs to step above the last level to confirm the continuation of the bullish bias towards 1.0239 followed by 1.0279 levels as next...

# Low yield reaches 2.624%. Yields down about 10 basis points on the week. US 10 year yield trading to new lows US 10 year  yield  trading to new lows The US 10 year yields are trading at session lows of 2.624%. The high yield for the day reached 2.728%. The yield has moved below swing lows from April 13 and April 14 at 2.648% and trades at the lowest level since April 7. The next target comes against the swing high from March 28 and the swing low from April 7 at the 2.557%. Below that, and the 50% midpoint of the move up from the December 3 low cuts across at 2.417%. Last week the price moved below the 100 day moving average (blue line in the chart above). On Tuesday, Wednesday, and Thursday this week sellers leaned against that moving average and broke lower yesterday. Last week, the yield closed at 2.752%. Since July 21 (7 trading days), the yield has moved from a high of 3.081% to the low today of 2.624% (-46 basis points). The high yield for the year reached ...

# The EURJPY is down close to 2% on the day EURJPY trends lower The  EURJPY  is the biggest mover on the day. The pair has declined nearly 2% (down -1.97% currently). The current price is at 136.51. The low for the day reached 136.39. Technically, the day started with the pair banging against the 100 hour MA (blue line in the chart above) and a downward sloping trendline connecting highs from Monday and Tuesday. Both those levels came in near 139.30. Admittedly, yesterday during the FOMC  volatility  , the price moved above those technical levels, but could not sustain momentum. Sellers started to lean against the levels into the early Asian session today, and then moved away from the levels. That was an early clue for the sellers. Buyers turned to seller after leaning against trendline and moving average resistance. The move lower moved all the way down to 137.90 before correcting higher. Looking at the 5 minutes chart below, the corrective move to the ...

# Early in the American session, the USD/JPY pair is trading at around the key 6/8 Murray support and around the bottom of the downtrend channel formed on July 13th. The last six candles on the 4-hour chart appear bearish due to strong selling after the FOMC meeting, so the pair fell from 137.45 (8/8 Murray). This marks the second day in a row of negative movement and has dragged the pair to a new monthly low at around 134.34. From a technical point of view, USD/JPY could extend its strength if it consolidates below the 200 EMA located at 135.69. This will be seen as a new trigger for the bears and the pair could drop to 5/8 Murray at 132.81. The subsequent drop below the 50% Fibonacci level (135.48) of the strong bullish move from 131.50 to 139.39 validates the negative outlook. In light of this, bearish traders could wait for some selling below the 135.69 (200 EMA) area but could be capped by strong support at 134.37 (6/8 Murray). The 61.8% Fibonacci level of the strong bullish...

# The yen has surged on Thursday. USD/JPY trades at 134.46, down 1.56% on the day. Yen jumps on US GDP decline The US dollar has lost ground against the majors, following a soft US GDP reading earlier. The US economy contracted in the second quarter by 0.9%, surprising the markets which had forecast a 0.5% gain. This follows the Q1 reading of -1.6%, and significantly, marks a second successive quarter of negative growth. Is the US economy in a recession? A technical definition of a recession is two consecutive quarters of negative growth, although there is no official definition. The “R” word is laden with political significance, so it’s a safe bet that a Republican and a Democrat would give two different answers. An unpopular President Biden can ill afford to have Americans turn on their TV sets and hear that the US is in a recession, especially before the mid-term elections. Ahead of the GDP release, the White House went so far as to mobilize officials, including Treasury Secretar...

# Financial markets clearly overdid it, reacting to Jerome Powell's announcement that the federal funds rate would reach a long-term neutral level of 2.5%. The very thing that does not stimulate, but does not constrain the economy. Investors considered the Fed's mission to slow inflation accomplished, and then only a modest tightening of monetary policy is required from the Central Bank. A sort of dovish shift that allowed EURUSD to soar above 1.02. In fact, everything was different. The bulls overdid it and very soon broke their foreheads. The Fed chairman's speech at the end of the July FOMC meeting had nothing to do with "dovish" rhetoric. On the contrary, Jerome Powell advised paying attention to the forecasts of the Federal Open Market Committee, according to which, the federal funds rate should rise to 3.4% by the end of 2022 and to 3.8% in 2023. As for the September meeting, the Central Bank's verdict on how much to raise it, by 75.50 or 25 bps, will d...

# 38.2% at 12124.37 Nasdaq erases declines and pushes toward 38.2% retracement The  Nasdaq  has retraced the move lower and has made a new high for the day as the buyers and sellers continue the battle. The run back to the upside has also returned to, and now through, the July 22high (at 12093.02), and is within sniffing distance of the 38.2% retracement from the March29 high as well at 12124.37. The high just reached 12104.58. If the price can get and stay above the 38.2% retracement it would be good news for the buyers. The swing high from June 2 at 12320.12 would be the next upside target. First things first, get above the 38.2%. Key target to get to and through to prove the buyers have the conviction to move higher. The Dow Jones up 224 points or 0.7% at 32422 and the S&P is up 30 points or 0.75% at 4054. The Russell 2000 is up 13.14 points or 0.71% at 1861. US yields remain down but off there lowest levels: 2 year, 2.887% with a low for the day of 2.81...

# Today, the US Federal Reserve will announce the results of its July meeting. This is the most important event of the month for dollar pairs, so there is no doubt that by the close of the trading day, we will see increased volatility for the EUR/USD pair. The only question is who will be the beneficiary of the inevitable price fluctuations—sellers or buyers? Obviously, everything will depend on the decisions taken by the regulator, as well as on the tone of the voiced rhetoric. The baseline scenario for the July meeting assumes an increase in interest rates by 75 points with the simultaneous announcement of a further increase following the results of the September meeting. Any deviation from this scenario will have a huge impact on the greenback. Fed members may not justify the hawkish expectations of the dollar bulls (primarily regarding the further pace of monetary tightening) or unexpectedly exceed these expectations—if, for example, they nevertheless decide on a 100-point rate i...

# According to the 4-hour chart, the British pound is trading below the 200 EMA located at 1.2108 and below the strong resistance of 3/8 Murray at 1.2085. Strong resistance has been established at 1.2085 which has prevented the British pound from a further rise. In the next few hours, the Fed's policy update will be released. The regulator is expected to increase the interest rate, which could spark off a strong movement in the British pound. Bullish optimism for GBP remains in play as long as the sterling trades above the 21 SMA located at 1.2019. The pound is expected to continue rising and could reach the resistance of 1.2101 (200 EMA). Conversely, with a sharp break of the rising wedge pattern and a close below the psychological level of 1.20, we could expect an acceleration to the downside towards the support zone of 2/8 Murray at 1.1962 and even to 1/8 Murray at 1.1840. On July 26, the eagle indicator reached the overbought zone, so a technical correction is likely in th...

# Good afternoon, dear traders! I present to your attention a trading idea for gold. So, after working out our trading recommendation for a fall from 27.07.22, gold did not consolidate under the falsely broken level of 1712, which confirms the formation of a large long three-wave ABC structure according to the following scheme: In fact, we have a three-wave structure of "ABC", where the long initiative acts as wave A on July 21-22. I propose to consider long positions according to the scheme shown above. Limit risks at 1,710 and 1,700. Take profit on the breakdown of 1,739, 1,744 and 1,752. The trading idea is presented within the "Price Action" and "Stop Hunting" methods. Good luck in trading and control the risks! Trading analysis offered by RobotFX and Flex EA . Source #RobotFX Team

# Early in the American session, gold is trading below the 21 SMA located at 1,722 and inside the symmetrical triangle formed on July 21st. Investors are awaiting the important information that will be unveiled in the afternoon of the American session at 18:00 GMT. Powell will give a press conference that could fuel strong market volatility. The high-impact policy decision will define the trend in the coming weeks. The Federal Reserve is expected to raise the interest rate by 0.75% to 2.50%. It is expected to generate a significant impact on financial markets. Gold as a safe-haven asset could suffer strong volatility. If the US dollar appreciates alongside Treasury bond yields, XAU/USD could fall towards the zone of 1,687 (2/8 Murray). Gold has found support at 1,718 which coincides with the zone of 3/8 Murray. In case of bouncing above this level, gold could gain momentum and could break the top of the downtrend channel represented by the symmetrical triangle. A close and consoli...

# If the traveler goes astray, he needs a guide. This guide for gold is traditionally not inflation, not geopolitical risks, or global economic growth, but the Fed. Despite the general aversion to the precious metal, expressed in the outflow of capital from ETFs in the amount of more than 100 tons over the past four weeks and in the first speculative shorts since 2019, XAUUSD quotes managed to stabilize near the $1,725 per ounce mark. Investors are eagerly awaiting the Fed's rate verdict. Dynamics of speculative positions in gold While the latest US macro statistics and comments by FOMC officials have virtually ruled out the possibility of raising the federal funds rate by 100 bps in July, CME derivatives give a 26% chance of such an outcome at the next meeting of the Committee. Investors are interested in what the Fed plans to do in September. Will it follow the ECB's lead into a data-driven policy, or will it continue to use direct guidance? The first option looks bad for ...

# Technical outlook: Bitcoin slipped through the $20,700 lows intraday on Tuesday only to find some support. The crypto is bouncing back and is seen to be trading close to $20,900 at this point in writing. Interim support is seen at around $18,900 for the time being and the bulls are expected to remain in control until it stays intact. Potential medium-term targets are seen towards $29,000 as projected here on the daily chart. Bitcoin has already carved a larger-degree downswing between $69,000 and $17,500 since November 2021. The above drop is unfolding in three waves until now and hence, it is corrective in nature. The high probability remains for another three-wave rally towards $48,000 or at least towards $29,000 before bears could be back in control. Keeping the suggested wave structure in mind, we have been considering Bitcoin positional longs from the $17,500-18,900 lows recently. Bitcoin might still have some upside left towards the $29,000 mark if not further. The bottom l...

# The price falls below the 50% midpoint of the corrective move higher EURUSD falls below the 50%. New lows for the day. There are two 50% midpoints in play in the  EURUSD  . One comes in above at the 50% of the move down from the June 27 high. That level came in at 1.02829. The high price last week reached 1.02773. The 2nd is of the move up from the July 14 low to the high reached last week. That level comes in at 1.01144. That level held earlier today, but is being broken in the current hourly bar. The earlier move to the downside today was helped by breaking the 100 hour MA at 1.0204 currently (blue line) and the 200 hour MA at 1.01641. The swing highs intraday after breaking the 200 hour MA stalled at the 38.2% of the recent move higher. Bearish. For sellers looking for lower levels, if the 200 hour MA keeps a lid on the pair, the sellers would stay in play (and have an advantage). Sellers will be looking for more downside momentum now with the 61.8% at 1.0076...

# Don't feed speculators with bread—let them muddy the waters in the financial markets. Recently, the oil trade has been characterized by increased volatility, as investors could not determine what was more important—a potential slowdown in demand against the backdrop of an approaching recession or supply problems. The fall of Brent from June highs of $125 a barrel indicates serious fears about a downturn in the global economy, which will undermine interest in black gold. On the contrary, backwardation expansion speaks of the difficulties of the proposal. The spread between closely related futures contracts for the North Sea grade widened to $5 per barrel. The market is bullish, but will buyers find the strength to restore the upward trend? Spread dynamics between Brent futures contracts Over the past two years, Brent has traded at $19 and $139 a barrel. Such a spread in prices has not been seen since the financial crisis of 2008, when the North Sea variety was thrown into the h...

# When you fight with one monster, there is hope of winning, but when there are several such monsters at once, the chances of celebrating success in battle fade before your eyes. If the Fed has to fight inflation based on strong domestic demand, which can be suppressed by raising rates, then the situation in Europe is quite different. The supply shock due to the armed conflict in Ukraine makes the ECB's tightening monetary policy useless and dangerous. An excessive increase in the deposit rate threatens a recession. And this is far from the only reason for EURUSD migraines. The transition of the Nord Stream to work at 20% of its capacity has exacerbated the already difficult situation in the eurozone economy. In this scenario, Germany is unlikely to be able to fill its gas storage by 75% and the EU by 80%. Moreover, Wood Mackenzie warns that a complete shutdown of supplies will deplete blue fuel stocks by February. The European economy is undergoing a structural rather than a cycl...

# GBPUSD bounces off of a upward sloping trendline at session lows GBPUSD tests the 50% midpoint area The  GBPUSD  has returned to the closing level from yesterday at 1.20481. The high price just reached 1.2053. The current price trades at 1.2043. The move back to the upside in the US morning session started after the pair tested a upward sloping trendline near the low at 1.19627. The rising 200 hour moving average also helped to give traders a level to lean against (green line in the chart above). After moving back above its 100 hour moving average (blue line currently at 1.1998), there was additional buying momentum. A swing area between 1.2024 and the 50% midpoint of the move down from the June 27 high at 1.20456 has seen a breach in the current hourly bar. On Friday, yesterday and again earlier today, that midpoint level was broken. So there is some precedent. However, momentum could not take the price back toward the 61.8% retracement target on each of the mov...

# EUR/USD is trading at its lowest level in a week and close to the 50.0% retracement projection of 0.9952 - 1.0277. The 61.8% Fibonacci retracement will provide good support at around 1.0070. This occurs in the context of cautious market sentiment and a strengthening dollar. Investors are uncertain about the outcome of the two-day FOMC meeting, which starts on Tuesday. On Wednesday, the announcement of a rise of 0.75% is expected. EUR/USD could consolidate around the 1.0120 zone (50%). In case of a sharp break, it is expected to fall to the zone of 1.0070 (61.8%). If EUR/USD returns above the 21 SMA located at 1.0205, it could offer relief and could resume its bullish cycle. Technically, the 4-hour chart shows that the pair accelerated its decline after a few failed attempts to break above 4/8 Murray at 1.0253. The technical indicators have resumed their declines showing negative levels. The eagle indicator is at overbought levels. Hence, the downward pressure is likely to continu...

# The wave marking required clarification for the pound/dollar instrument, and such was made. The upward wave, built between May 13 and May 27, does not fit into the overall wave picture, but it can still be considered corrective as part of the downward trend section. Thus, we can say that the construction of the upward correction section of the trend is canceled, and the downward section of the trend will take a longer and more complex form. I am not a big supporter of constantly complicating the wave marking when dealing with a strongly lengthening trend area. It would be much more practical to identify rare corrective waves, after which new impulse structures would be built. We have completed waves 1, 2, and 3, so we can assume that the instrument is now building wave 4. The wave markings of the euro and the pound are slightly different in that the downward trend section for the euro has an impulse form (for now). But the ascending and descending waves alternate almost equally. Aft...

# At the start of a new trading week in Germany, reports from the IFO Institute were published. The indicators came out in the "red zone." The July result was de facto weaker than weak expectations. German business sentiment fell to 88 points against the forecast decline to 90. This is a two-year low: the last time the indicator was at such a low level was two years ago, during the coronavirus crisis. The German indicator of economic expectations was also disappointing, which collapsed to 80 points: this is the weakest result since April 2020. Commenting on the published figures, the institute's economist said that representatives of the surveyed companies expect "a significant deterioration in business activity in the coming months." The IFO also warned that Germany is on the verge of a recession: the rise in the energy prices and gas shortage are putting significant pressure on the country's economy. German reports from the IFO are consistent with the P...