The USDCAD pair shows negative trades to test the key support 1.3680, as it consolidates above it until now, to keep the bullish trend scenario active for the upcoming period, waiting to head towards 1.3830 initially. Breaching 1.3740 will ease the mission of achieving the expected rise, noting that breaking 1.3680 will stop the positive scenario and put the price under additional negative pressure on the intraday basis.
The expected trading range for today is between 1.3640 support and 1.3790 resistance. The expected trend for today: Bullish.
The European currency shows a slight increase, consolidating near 0.9880 and updating local highs from October 6. The activity of the "bulls" remains quite low, as traders are concerned about the prospect of economic growth in Europe against the backdrop of high energy prices. The euro is also slightly supported by the comments of the representatives of the American regulator, who are increasingly speaking in favor of softening their position on further tightening of monetary policy. One way or another, the US Federal Reserve, the European Central Bank (ECB), and the Bank of England are preparing to raise interest rates in early November, and after this, time will probably be given to evaluate the measures already taken. Macroeconomic statistics released yesterday in Europe puts additional pressure on the positions of the single currency, preventing the "bulls" from realizing their accumulated potential. The S&P Global Manufacturing PMI in Germany fell from 47.8 points to 45.7 points in October, while analysts expected a decrease to 47.0 points, and the Services PMI adjusted from 45.0 points to 44.9 points, 0.2 points higher than the predicted value. In the eurozone, the Manufacturing PMI fell from 48.1 points to 47.1 points (against the forecast of 47.5 points), and the Services PMI declined from 48.8 points to 48.2 points.
GBPUSD
The British pound is trading with multidirectional dynamics, consolidating near 1.1300. The day before, the GBP/USD pair showed a moderate decline, retreating from its local highs of October 18, reacting to the strengthening of the UK stock market, which welcomed the news of the election of Rishi Sunak as Prime Minister of Great Britain. The results of the race became known ahead of schedule, as Penny Mordaunt withdrew her candidacy without securing proper support in the party. Sunak is expected to keep Jeremy Hunt as Treasury Secretary and together they may be able to submit a mid-term budget plan before the end of the month. Both officials openly criticized the unreasonable tax cuts proposed by the Liz Truss administration. Additional pressure on the position of the instrument at the beginning of the week was exerted by frankly weak macroeconomic statistics from the UK. S&P Global Manufacturing PMI fell from 48.4 points to 45.8 points in October against the projected 48.0 points; Services PMI reduced from 50.0 points to 47.5 points which was also worse than market expectations of a decline to 49.0 points, and the Composite PMI fell from 49.1 points to 47.2 points.
XAUUSD
Gold prices show flat trading dynamics, consolidating near 1650.00. Yesterday, "bearish" sentiment prevailed in the instrument, and the XAU/USD pair eventually failed to consolidate on new local highs from October 14. In turn, quotes were moderately supported by the fact of a decrease in the yield of US Treasury bonds. 10-year yields fell from 4.212% to 4.209%, reacting to the publication of disappointing macroeconomic statistics on the level of business activity in October. The S&P Global Manufacturing PMI fell from 52.0 points to 49.9 points, while analysts expected a decrease to 51.2 points, and the Services PMI fell from 49.3 points to 46.6 points, which also turned out to be worse than predicted 49.2 points. Today, the US is expected to publish August data on Housing Price Index from S&P Global, as well as the October statistics on the level of Consumer Confidence.
FTSE 100 - Results of the elections in the UK pushed the index up
The day before, Rishi Sunak was appointed the new Prime Minister and head of the Conservative Party with 178 of the 355 members of the Conservative faction in the House of Commons having voted for him. The official managed the British economy during the coronavirus pandemic and analysts believe that he is able to lead the country out of the current crisis. Probably, this news has already been taken into account by the market, since even the negative effect of the publication of a report on business activity, which showed a decrease from 48.4 points to 45.8 points in the Manufacturing sector and from 50 points, to 47.5 points in the Services sector could not put pressure on the dynamics of the pound.
Quotes of the index continue to try to start corrective growth. Technical indicators are holding a sell signal, which has noticeably weakened recently.
Support levels: 6920, 6710 | Resistance levels: 7090, 7270
Currently, the instrument is close to 1375 (Murrey [2/8]), but further upward dynamics are restrained by the upper border of the downwards channel. If it consolidates above it, the movement can continue to 1450 (Fibonacci correction 50.0%), 1500 (Murrey [ 4/8]) and 1575 (Fibonacci retracement 38.2%). Otherwise, quotes may return to the lower border of the sideways range 1250 (Murrey [0/8]) or to 1187.5 (Murrey [–1/8]) and 1125 (Murrey [–2/8]).
Gold price resumes its negative trading to move away from the EMA50, reinforcing the expectations of continuing the bearish trend in the upcoming sessions, waiting for more decline to visit 1615 level that represents our next main target, reminding you that the continuation of the bearish wave depends on the price stability below 1660.
The expected trading range for today is between 1625 support and 1665 resistance, and the expected trend for today: Bearish.
The AUDUSD pair managed to touch our first target at 0.6270 and bounced bullishly from there, affected by stochastic positivity, waiting to resume the main bearish wave that its next main target at 0.6170. Holding below 0.6397 represents major condition to continue the expected decline, as breaching it will lead the price to achieve additional bullish correction that its next target might reach 0.6540.
The expected trading range for today is between 0.6250 support and 0.6380 resistance. The expected trend for today: Bearish.
EURUSD - Strong Statistics from Germany supported Euro quotes
The German index of business expectations in October amounted to 75.6 points, which is higher than 75.3 points in September and better than the forecast of 75.0 points. The assessment of the current situation in the region consolidated at 94.1 points, significantly exceeding the pessimistic forecasts of analysts, which suggested a decrease in the indicator to 92.4 points, and the business climate index at 84.3 points, which corresponds to September 84.4 points and exceeds the preliminary scores 83.3 points. According to experts, this data indicates that after five months of pessimistic views, expectations in the country's business circles have finally found a “bottom,” from which a turn in a positive direction can begin.
The trading instrument is moving within the global downwards channel, coming close to the resistance line and demonstrating its readiness to break it.
Resistance levels: 1.0014, 1.0186 | Support levels: 0.9876, 0.9680
The AUDUSD pair breached 0.6397 level strongly to rally upwards and confirms heading towards the next correctional level at 0.6540, to support the continuation of the expected bullish trend for today, noting that breaching the mentioned level will extend the bullish wave to reach 0.6650, while the expected rise will remain valid conditioned by the price stability above 0.6397.
The expected trading range for today is between 0.6430 support and 0.6540 resistance. The expected trend for today: Bullish.
Crude Oil - US inventory growth puts pressure on oil quotes
The long-term trend is downward. The key resistance level is located at 93.5, and the key support is around 76.50. Last week, buyers unsuccessfully tried to break out the 86.5 mark, therefore, we can assume a decline in prices to the nearest support level of 81.
The mid-term trend remains upward. Last week, market participants tried to break the key trend support in the area of 86.21–85.46. The trading week closed inside the range, which indicates the retention of support. The trend target is the October maximum in the area of target zone 2 (94.27–93.43). Consequently, it will be possible to consider oil purchases when the first signs of an upward movement appear from approximately the current levels.
Resistance levels: 86.5, 89.5, 93.5 | Support levels: 81, 76.5
The uncertainty of the movement of quotations is associated with the approaching timing of the court decision on the suit of the Securities and Exchange Commission (SEC) against Ripple, as well as the departure of one of its leading specialists, Nik Bougalis, who was previously involved in the software of the XRP Ledger payment system. To continue the decline, the quotes will have to consolidate below 0.4330 (Fibonacci correction 23.6%). In this case, the decline will continue to 0.3906 (Murrey [0/8]) and 0.3570. The zone 0.4883–0.4780 (Murrey [2/8], the middle line of Bollinger Bands) seems to be the key “bullish” region, the breakdown of which will lead to the price exiting the long-term downward channel and give the prospect of further growth to 0.5219 (Fibonacci correction 38.2%) and 0.5371 (Murrey [3/8]).
The GBPJPY pair kept its stability near 170.10 recorded high, hinting surrendering to the domination of the bullish bias, also, the major indicators continue to provide the positive momentum allowing us to keep the bullish overview that might target 170.70 followed by attempting to achieve additional gains by moving towards 172.45 that forms the next main target.
We remind you that it is important to hold above the additional support 166.70 to confirm blocking trades within the bullish track until reaching the suggested targets. The expected trading range for today is between 168.8 and 170.7
Dow Jones - Correction after the publication of corporate reports
US stock indicators took advantage of the slowdown in the bond market and continue to grow on the back of positive corporate reporting. Now the quotes of the Dow Jones index are being corrected in the area of 31783.
Index quotes continue corrective dynamics, rising in the direction of the global channel resistance line.
Technical indicators are holding a buy signal, which is gradually strengthening: the range of EMA fluctuations on the Alligator indicator expands in the direction of growth, and the histogram of the AO oscillator is forming new ascending bars in the purchase zone.
Support levels: 31150, 29670 | Resistance levels: 32500, 34200
USDCAD - Bank of Canada decides to keep the rate hike pace
Yesterday, the regulator decided to raise the interest rate by 50.0 basis points, not by 75 points, as most experts predicted, bringing it to 3.75% from 3.25% earlier. In an accompanying statement, officials noted that they expect the country's gross domestic product (GDP) to seriously slowdown from 3.25% to less than 1.00% by early 2023 due to inflation, which, although it fell from 8.1% in the last quarter to 6.9% the basis of this weakening was fuel prices, which fell on the world market. Core inflation, a more accurate indicator of consumer prices, has not eased, and the Bank of Canada expects negative dynamics only in the second half of 2023.
On the daily chart of the asset, the price is trying to consolidate in a downward corrective trend.
Resistance levels: 1.3610, 1.387 | Support levels: 1.3500, 1.325
Crude Oil - US fears Russia's complete refusal to import oil
Quotes are growing against the backdrop of new information from the United States about the possible introduction of a price limit for imported from the Russian Federation oil. After negotiations with the parties to the agreement, the American authorities decided to soften their position, and the value was changed from 50.0 dollars per barrel to 60.0 dollars per barrel, which was supported by the G7 countries, Australia and South Korea. US Treasury Secretary Janet Yellen explained the decision by saying that if the price is too low, Russia can completely abandon imports.
On the daily chart of the asset, the price is moving within the downwards corridor, coming close to the resistance line.
Resistance levels: 97.6, 103.5 | Support levels: 89.8, 82.5
Gold price settles above 1660 level and attempts to gain the positive momentum on the intraday time frames, while the EMA50 continues to support the price from below.
Therefore, the bullish trend scenario will remain valid and active for the upcoming period, affected by the previously completed inverted head and shoulders’ pattern, waiting to visit 1686.40 level as a next main target, reminding you that the continuation of the bullish wave depends on the price stability above 1660.
The expected trading range for today is between 1650 support and 1686 resistance, and the expected trend for today: Bullish.
The EURUSD pair ended yesterday below 1.0000 level, to fall under potential negative pressure in the upcoming sessions, but we notice that stochastic shows clear positive signals that pushes the price to start positively today, to face contradiction between the technical factors that makes us prefer to stay aside until the price confirms its situation according to the mentioned level.
Note that consolidating below it will press on the price to achieve new declines and head towards 0.9890 followed by 0.9850 levels, while breaching it will lead the price to resume the correctional bullish wave that its next targets located at 1.0150 followed by 1.0285.
The expected trading range for today is between 0.9900 support and 1.0080 resistance. The expected trend for today: Neutral.
The NZDUSD pair rallies upwards now to breach 0.5835 level and attempts to hold above it, reinforcing the expectations of continuing the correctional bullish trend, opening the way to head towards 0.5910 as a next main target. The EMA50 continues to support the suggested bullish wave, noting that holding above 0.5835 represents initial condition to continue the expected rise.
The expected trading range for today is between 0.5810 support and 0.5930 resistance. The expected trend for today: Bullish.
The USDCHF pair provided clear positive trades yesterday to breach 0.9890 level, but it begins today with new decline to press on this support and attempts to hold below it, motivated by stochastic negativity that appears clearly on the four hours’ time frame, which supports the chances of continuing the correctional bearish trend, which its next target located at 0.9815.
Therefore, we will continue to suggest the bearish trend for the upcoming period conditioned by the price stability below 0.9890. The expected trading range for today is between 0.9800 support and 0.9950 resistance, and the expected trend for today: Bearish.
The AUDUSD pair trades with clear negativity now to test the key support 0.6397, which urges caution from the upcoming trading, as the price needs to hold above this level to keep the bullish trend active for the upcoming period, as breaking it will push the price to stop the correctional bullish scenario and return to the main bearish track again.
The expected trading range for today is between 0.6370 support and 0.6480 resistance. The expected trend for today: Bullish.
The BTCUSD continues forming the new uptrend as a standard zigzag A-B-C. The A impulse completed; the descending correction B formed as a double zigzag [W]-[X]-[Y]. The upward wave C is currently unfolding as an impulse [1]-[2]-[3]-[4]-[5]. Sub-wave [3], currently developing, should finish at a level of 21244.00, where it will be 200% of sub-wave.
