Thursday, November 24, 2022
Wednesday, November 23, 2022
SIGNAL: GBPNZD Sell Limit
SYMBOL: GBPNZD
ORDER: SELL LIMIT
PRICE: 1.9450
SL: 1.9550
TP: 1.9200
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Entry modified from 1.9490 to 1.9450
Tuesday, November 22, 2022
NEWS 22 NOV
SYMBOL CHANGE
NZD +0.23%
CHF +0.06%
JPY -0.02%
EUR -0.02%
CAD -0.03%
GBP -0.04%
AUD -0.05%
USD -0.14%
*Updated 10:00 am GMT+2
--------------------------------------------
Forex live: European Central Bank board member and Bank of Portugal Governor Mario Centeno spoke at a conference in Lisbon on Monday.
Asked whether he thinks the ECB should raise interest rates by less than 75 basis points, Centeno said: "I don't like to talk about increases before (meetings)...(but) I think there are many conditions for the rates increase to be less than that number"..... EUR bearish
Tradingeconomics: "UK Budget Gap Below Forecasts.
Public sector net borrowing excluding public sector banks in the UK was £13.5 billion in October of 2022, £4.4 billion more than in October 2021 and the fourth highest October borrowing since monthly records began in 1993. However, figures came below market forecasts of a £22 billion deficit." ..... GBP Bearish
TE: "Japanese Shares Climb in Broad Rally.
The Nikkei 225 Index climbed 0.61% to 28,116 while the broader Topix Index added 1.12% to 1,995 on Tuesday, extending gains from the previous session, with nearly all sectors finishing in positive territory. Still, investors remain cautious ahead of US Federal Reserve meeting minutes that could offer clues on the trajectory of US rate hikes, while monitoring the Covid situation in China." ..... MKT Bullish
TE: "NZ Dollar Firms Up Ahead of RBNZ Decision.
The New Zealand dollar firmed up above $0.61 on Tuesday, holding its ground ahead of the Reserve Bank of New Zealand’s policy decision, where it is expected to deliver an unprecedented 75 basis point rate hike to get inflation under control." ..... NZD Bullish
TE: "Dollar Eases as Fed Outlook Mulled.
The dollar index fell to around 107.5 on Tuesday, giving back some gains from the previous session as investors cautiously awaited the latest Federal Reserve meeting minutes that could guide the outlook for US rates. Traders also parsed through various remarks from Fed officials who have largely maintained a strong commitment to bring down inflation. In the latest commentary, San Francisco Fed President Mary Daly warned against overtightening, while Cleveland Fed President Loretta Mester said she wants to see inflation come down sustainably before supporting a pause." ..... USD Bearish
TE: "New Zealand Trade Deficit Widens in October.
New Zealand recorded a trade deficit of 21.29 NZD billion in October of 2022 versus 16.15 billion in the previous month." ..... NZD Bearish
Reuters: "Fed's Mester (2022 voter) said it makes sense to slow down a bit the pace of rate hikes and that they can now be very deliberate in setting policy, while she noted the Fed needs to be more judicious in balancing risks but added the Fed is not anywhere near to stopping rate hikes. Furthermore, Mester thinks they can slow down from 75bps at the December meeting and said that going forward, they need to let the economy tell them the pace of rate hikes" ..... USD Bearish
FT: "ECB's Holzmann said he supports a 75bps hike in December and noted there are no signs that price pressures are easing" ..... EUR Bullish
Bloomberg: "ECB's Centeno sees conditions for rate hikes to be less than 75bps in December and said they "really have to reverse" the trend of rising inflation to have greater visibility on monetary policy" ..... EUR Bearish
Bloomberg: "Saudi officials denied reports of talks regarding increasing OPEC+ oil output and said the current cut of 2mln BPD is to continue until the end of 2023" ..... Oil Bullish
DJ news: "The latest eurozone current account data on Tuesday showed some early signs of rebalancing and this should support the euro, HSBC says" ..... EUR Bullish
DJ news: "The dollar falls after more cautious comments from Federal Reserve officials Loretta Mester and Mary Daly about the outlook for interest rates, MUFG Bank says. The release of the latest Fed meeting minutes on Wednesday will be the next key test for the dollar as it will provide insight into the central bank's policy thinking ahead of its next meeting on Dec. 14, MUFG currency analyst Lee Hardman says in a note. "The U.S. rate market is currently confident that the Fed will slow the pace of hikes by delivering a 50 basis points [rate rise] in December and then for rates to peak at around 5.00% next year." ..... USD Bearish
Monday, November 21, 2022
QUOTES 22 NOV
ASB bank: "we and many other forecasters are predicting that the RBNZ will lift the OCR by 75bp on Wednesday, which would be a step up in pace after five consecutive 50bp moves. It is by no means a done deal, which is reflected in interest rate pricing that puts the odds of a 75bp move (vs. 50bp) at around 60%." ..... NZD Bullish
ING: "China’s Covid situation has suddenly returned as a very central driver for global markets this week. Over 27,000 cases were reported today, with the city of Guangzhou being the new epicentre of the outbreak, and local authorities are reportedly scrambling to impose those same restrictive measures that appeared a thing of the past after recent signals from the central government that the zero-Covid policy would be gradually abandoned." ..... MKT Bearish
QUOTES 21 NOV
ING: "Wednesday will see the release of the minutes of the 2 November FOMC meeting. At the time, we felt that it was still a reasonably hawkish meeting - although the Fed clearly wanted to shift the narrative from the size of rate hikes to the terminal rate. The minutes could pose a risk that the current dollar correction extends - especially since we will be faced with thin markets later this week as the US celebrates the Thanksgiving public holiday on Thursday. But assuming there are no big surprises - e.g. 'many participants wanting to take stock of the tightening undertaken so far, we would expect the dollar to find support on dips." ..... USD BULLISH
ING: " In addition to the continued wall of European Central Bank speakers, this week will see the advanced November PMIs for the eurozone, Germany and France. The composite PMIs are expected to be in contraction territory for all three and be a reminder that at some point the ECB will probably call time on its tightening cycle. Our team's view is that the ECB hikes 50bp on 15 December (59bp priced in the markets) and then finishes the cycle with a 25bp hike in February. In other words, we look for the cycle to conclude at 2.25% rather than the 2.90% area priced for the markets in late summer." ..... EUR BEARISH
NEWS 21 NOV
- Chicago National Activity Index Actual -0.05 (Forecast -0.025, Previous 0.10) ..... USD BEARISH
- The Chicago Fed National Activity Index fell to -0.05 in October of 2022 from an upwardly revised +0.17 in September, the weakest reading in four months, suggesting slower national economic growth ..... USD BEARISH
- Fed's Bostic: Ready To 'Move Away' From Large Rate Increases ..... USD BEARISH
- ECB Chief Economist Philip Lane said in an interview that “we expect to raise rates further”. But “each meeting is different” and “one platform for considering a very large hike, such as 75 basis points, is no longer there.” ..... EUR BEARISH
- The annual producer inflation in Germany fell to 34.5% in October 2022 from a record level of 45.8% in September and August, compared with market forecasts of 41.5%, pointing to the lowest level since June ..... EUR BEARISH
- European bourses are pressured across the board, as China's COVID crackdown weighs on sentiment ..... MARKETS BEARISH
- US futures started a shortened holiday week in the red, with contracts on the Dow Jones futures falling almost 100 points while both the S&P 500 and the Nasdaq were down 0.3% and 0.7% respectively, amid flight to safety on concerns of further curbs in China after the country reported covid deaths for the first time in six months during the weekend ..... MARKETS BEARISH
- Oil extended losses on Monday, with WTI crude futures falling below $80 per barrel, the lowest in over seven weeks, amid demand concerns after China tightened Covid curbs ..... OIL BEARISH
SIGNAL: BUY LIMIT AUDCAD
SYMBOL: AUDCAD
ORDER: BUY LIMIT
PRICE: 0.8850
SL: 0.8800
TP: 0.9000
VALID UNTIL THE END OF THE DAY
Thursday, November 17, 2022
SIGNAL: Sell limit EURCHF
SYMBOL: EURCHF
ORDER: SELL LIMIT
PRICE: 0.9850
SL: 0.9900
TP: 0.9750
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UPDATE: 21/11/2022
TIME: 12:55 GMT+2
Move SL to BE (0.9850)
QUOTES 17 NOV
Bloomberg: "The correction in the dollar might be over, according to some technical indicators and the latest repricing in the options space. On a trade-weighted basis, the greenback retreated by 7% from its cycle highs back in September, mainly driven by position rebalancing over a potential Federal Reserve pivot. The extent of this drop in the spot market now satisfies a so-called ABC correction of a full Elliott Wave cycle that started a year ago. Moreover, the dollar’s rebound Tuesday from intraday lows came after testing a pivotal support level, namely the 38.2% Fibonacci retracement of its rally since early 2021. Given another positive signal emerged, a DeMark Buy Setup on the daily chart, the dollar’s technical outlook has turned bullish, at least in the short-term. Options-wise, traders are back into adding topside structures over the one-month tenor that captures the release of the next employment and inflation reports out of the US, as well as the Fed’s policy meeting in December. So it could be that options market makers are now less convinced that the greenback is in for more losses, especially as FOMC officials keep reminding us that the terminal rate matters more than the size of the next hike. That Fibonacci support, close to the Tuesday lows, has now game-changing potential, either way." USD BULLISH
Bloomberg: "European Central Bank policy makers may slow down interest-rate hiking with only a 50 basis-point increase next month, according to people with knowledge of the matter. Initial discussions suggest a lack of momentum for another 75 basis-point move at present. Barring another surprise surge in inflation, the consensus might well favor the less aggressive step. Among reasons cited are mounting recession risks, the possibility that consumer-price pressures will weaken and the prospect that a half-point move in the deposit rate to 2% will reach close to a so-called neutral level that no longer stimulates the economy." EUR BEARISH
Current situation
Hello Traders
Before posting an analysis, let's review the current situation on major currencies.
The main triggers that affect markets this year are:
- The Russian-Ukraine war that started Feb/2022
- Inflation that hit economies hard everywhere, triggered by massive easy money injected by central banks due to Covid and the war put extra weight
- Hiking rates that central banks started this year to fight inflation
- Deteriorating GDP growth and anticipating recessions next year
- Covid still plays a role especially in China due to its zero-Covid policy
The war is putting gloomy expectations for the Euro area in specific. Europe depends mainly on Russian gas for energy supply and Putin played this card to push on Europe due to their support to Ukraine. Until now, support continues but economies and people are suffering due to high energy prices. Winter is coming and Europe's problems will escalate, people will get angry and the economy will suffer more and more.
After a series of rates hiking, inflation starts to show cooling in some countries:
- Australia, Euro area, UK, Japan, and Newzealand still printing higher numbers
- Canada, Switzerland, and United States showed a sort of easing in inflation.
But how Central Banks act is the trigger behind FX price action. A dovish tone started to echo among central banks. Here is a summary of Interest Rates in 2022:
More details and updates are coming. Keep tuned.
Good Luck
WELCOME
Hello Traders
I hope this blog finds you well.
On this blog, you will find posts about Technical, Sentiment, and Fundamental analysis in a simple tradable way. My intention here is to create a destination for traders who seek a destination to acquire what they need to trade in a smart profitable way. And to reach this goal, here is what I promise:
- Technical charts and explanations in a clear tradable direction. No more both-way analysis.
- The market sentiment to figure out how traders think about markets today and correlations.
- Fundamentals that tell a story to trade not a story to justify price action.
Your support and engagement will encourage me to continue this journey.
Good Luck
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