Daily Market Analysis By FXOpen

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British Pound hits 37-year low against US Dollar

Just as we all thought a 20-year low point for the British Pound was a staggering end to a continual downward spiral for the world's most valuable currency, another leap toward the bottom took place.

The British Pound finished the trading week on Friday at an astonishing 37-year low.

That is a trip back to the dark days of the fierce industrial action by rampant workers unions of the early 1980s and the nationalization of many large companies such as British Leyland, the closures of the coal mines and inflation at over 18%.

As a result of some very drastic action by the government at the time, the economy was brought back into good order but it was a very difficult job for the working public, for businesses and for the government itself.

Today, the causes and circumstances are different, but the effect is the same. A catastrophically declining national economy and a volatile Pound which would have been unheard of for two decades until this year.

Retail sales figures in Britain which were released early in the Friday trading session on the London market underscored a high street in trouble. Retail sales volumes fell by 1.6% in August, continuing a downward trend since summer 2021 according to the Office for National Statistics, demonstrating that the public are cash-strapped and are perhaps prioritizing their main household bills rather than shopping for new consumer products.

With news channels full of anticipation of expensive winter energy bills and a potential 18% inflation figure by January, a conservative approach is being taken by a large portion of the population.

The Bank of England, which is the Central Bank of the United Kingdom, last week made an announcement relating to its decision relating to potential interest rate rises one day before an emergency mini-budget was delivered by newly appointed Chancellor of the Exchequer Kwasi Kwarteng.

UK inflation stands at 9.9% currently, and has been predicted to rise to 18% by Citi by January during a prediction last month in which the same analysts at Citi suggested that the interest rate may rise from the 1.75% it stands at currently to a sudden 7% by January.

Some pundits have stated that inflation in the United Kingdom may go over 20%, and this analysis was not coming from sensationalists, rather from the analytical think tanks within some investment bank.

It is now being suggested by commentators that inflation may begin to drop if the British government lives up to its promise of capping consumer energy costs for the next two years, although energy costs continue to spiral whereas in France, they have been capped some months ago.

The BoE may rein in any thoughts of a 75 basis point rate hike if they believe/know that the chancellor will effectively cool price pressures the next day. This may leave GBP/USD vulnerable to a further sell-off, especially if the US Federal Reserve hikes by a minimum of 75 basis points on Wednesday last week.

What a bleak outlook for the Pound, and the wider British economy!

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US Stock market complacency on the bankers' radar

At the end of last week, we all witnessed a spectacular collapse in the value of some of the most prestigious indices on New York's exchanges, much to the surprise of those who had been looking at the relative strength of the United States economy compared to the flagging counterparts on the European side of the Atlantic.

Just as minds were concentrating on the strength of the US Dollar against the plummeting British Pound, a false sense of security had become evident, and the US was being held up as a shining example; the West's only productive economy in today's climate of rampant inflation, low productivity and massive national debt.

As stock markets crashed last week, analysts at investment banks made grave predictions that the S&P500 could fall another 22% this year.

During the later part of the US trading session yesterday, the Chief Investment Officer at investment bank Morgan Stanley stated that complacency is abound among stock market investors at a time at which interest rates are on the increase.

Morgan Stanley's Lisa Shallett told MarketWatch yesterday evening “The real 10-year Treasury yield, at 1%, approaches a four-year high. Consider that back in June, when the real rate was at this level, the S&P 500 Index was at 3,667, 5.3% lower than it is now.”

Equally, Morgan Stanley has been the bearer of another grave statistic: there has been a considerable downturn in technology company IPOs due to the gloomy market conditions.

Tomorrow will mark 238 days without a technology company IPO worth more than $50 million on the American markets, surpassing the previous records set in the aftermath of the 2008 financial crisis and the early 2000s dotcom crash.

Some proposed fintech IPOs have been withdrawn, with one insider having said "Who would go public in this market?".

The tech-dominated Nasdaq Composite has fallen nearly 28% this year compared with a drop of just over 19% in the S&P 500 and the aforementioned predictions that a further even larger amount could fall from the value of the S&P500 before the year is out.

There are genuine fears of a looming recession across all Western markets. The pound is at a 37 year low against the US Dollar and Britain's economy is flagging, whereas despite a strong US Dollar and productive American economy, the inflation and interest rate rises have been a key catalyst in collapsing the value of company equities listed on top New York exchanges.

The volatility is there, but has to be navigated carefully!

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BTCUSD and XRPUSD Technical Analysis – 20th SEP 2022

BTCUSD: Bullish Engulfing Pattern Above $18293

Bitcoin was unable to sustain its bearish momentum and after touching a low of 18322 on 19th Sep, it has entered into a consolidation channel above the $19000 handle today in the European trading session.

The price of bitcoin continues to move in a tight range between 19200 and 19700 levels today suggesting that we have hit the bottom of the downtrend.

We can see the formation of an ascending channel pattern on the hourly chart of the BTCUSD.

The price of bitcoin is nearing the horizontal support level in the daily time frame indicating the bullish tone in the markets.

We can clearly see a bullish engulfing pattern above the $18293 handle which is a bullish reversal pattern because it signifies the end of a downtrend and a shift towards an uptrend.

Bitcoin touched an intraday high of 19679 in the Asian trading session and an intraday low of 19195 in the European trading session today.

Both the STOCH and Williams percent range are indicating overbought levels which means that in the immediate short term a decline in the prices is expected.

The relative strength index is at 53 indicating a NEUTRAL demand for bitcoin at the current market levels and the continuation of the buying pressure in the markets.

Bitcoin is now moving below its 100 hourly simple moving average and below its 200 hourly exponential moving averages.

Some of the major technical indicators are giving a BUY signal, which means that in the immediate short term, we are expecting targets of 20000 and 21500.

The average true range is indicating LESS market volatility with a mild bullish momentum.

• Bitcoin: bullish reversal seen above $18293
• The commodity channel index is indicating a neutral level
• The price is now trading just above its pivot level of $19399
• Some of the moving averages are giving a BUY market signal
  

Bitcoin: Bullish Reversal Seen Above $18293

The price of bitcoin has crashed below the important support level of $19000 due to the strength of the US dollar and the increase in the global market liquidity pattern.

The adaptive moving average AMA50 and moving average MA20 is giving a bullish trend reversal signal in the 15-minutes time frame.

We can see that the momentum indicator is giving a bullish trend signal in the weekly time frame.

We have also detected a bullish opening of the markets indicating the underlying bullish sentiment.

The immediate short-term outlook for bitcoin is bullish, the medium-term outlook has turned neutral, and the long-term outlook remains neutral under present market conditions.

Bitcoin’s support zone is located at $18000 and the prices continue to remain above these levels for the continuation of the bullish reversal in the markets.

The price of BTCUSD is now facing its сlassic resistance level of 19544 and Fibonacci resistance level of 19722 after which the path towards 20000 will get cleared.

In the last 24hrs BTCUSD has increased by 4.77% by 881$ and has a 24hr trading volume of USD 36.188 billion. We can see an increase of 6.47% in the trading volume compared to yesterday, which appears to be normal.

The Week Ahead

The price of bitcoin is moving in a consolidation zone above the $19000 level. At present the price of bitcoin is gaining a bullish traction against the US dollar in the medium-term range.

We can see the buildup of positive momentum in the markets with the prices moving close to the psychological support level of $20000.

The daily RSI is printing at 40 which indicates a weak demand from the long-term investors.

The price of BTCUSD will need to remain above the important support level of $18500 this week.

The weekly outlook is projected at $21000 with a consolidation zone of $20000.

Technical Indicators:

The moving averages convergence divergence (12,26): is at 5.20 indicating a BUY

The ultimate oscillator: is at 51.34 indicating a BUY

The rate of price change: is at 0.70 indicating a BUY

The average directional change (14): is at 28.61 indicating a BUY

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Disclaimer: CFDs are complex instruments and come with a high risk of losing your money.

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EUR/USD Remains At Risk, USD/CHF Could Increase Further

EUR/USD is struggling to stay above the 0.9950 support zone. USD/CHF is rising and might climb higher towards the 0.9750 resistance zone.

Important Takeaways for EUR/USD and USD/CHF

• The Euro is struggling to recover and trading below the parity level against the US Dollar.
• There was a break below a key bullish trend line with support at 0.9990 on the hourly chart of EUR/USD.
• USD/CHF started a fresh increase after it cleared the 0.9600 resistance zone.
• There is a major bullish trend line forming with support near 0.9640 on the hourly chart.
  

EUR/USD Technical Analysis

This past week, the Euro saw a major decline below the 1.0040 support against the US Dollar. The EUR/USD pair declined below the 1.0000 support level to move further into a bearish zone.

The pair formed a base above the 0.9950 level and recently started an upside correction. There was a move above the 0.9980 and 1.0000 resistance levels. The pair climbed above the 1.0020 level and the 50 hourly simple moving average.

EUR/USD Hourly Chart

However, the bears were active near the 1.0050 level. As a result, there was a fresh decline below the 1.0000 support. There was a break below a key bullish trend line with support at 0.9990 on the hourly chart of EUR/USD.

The pair traded as low as 0.9955 and is currently consolidating losses. An immediate resistance is near the 0.9980 level. It is near the 23.6% Fib retracement level of the downward move from the 1.0050 swing high to 0.9955 low.

The next major resistance is near the 1.0030 level. It is near the 50% Fib retracement level of the downward move from the 1.0050 swing high to 0.9955 low.

A clear move above the 1.0030 resistance zone could set the pace for a larger increase towards 1.0080. The next major resistance is near the 1.0120 zone.

On the downside, an immediate support is near the 0.9955 level. The next major support is near the 0.9920 level. A downside break below the 0.9920 support could start another decline.

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After a long period of hardship, the Japanese Yen is back on track

Japan's beleaguered economy has been kept relatively quiet on the global news scene over the past two years, but domestically, it has been at the forefront of everyone's minds for a long time now.

Japan's business-focused, ultra-conservative modus operandi was applauded by many during 2020 and 2021, as the country did not lock its population down and remained well and truly open for business at a time when many other nations did lock their population down.

Given that the country continues to demonstrate high quality industrial prowess in many manufacturing sectors, and that it has had a continuity of business at a time when other nations had theirs disrupted by their own governments, it would be an easy conclusion to draw that Japan is doing well.

Things are never quite that simple.

Japan has kept itself firmly out of the global political trends, and has focused on its own issues, another policy that would perhaps be very laudable under normal circumstances, however unfortunately the country's economy has been in dire straits for some time

During the course of this year until last week, the nation's currency, the Japanese Yen, had plunged in value by a remarkable 24% and competition from neighboring South East Asian nations in the field of electronics and precision engineering have been impacting the position of Japan as a top tier economy.

This week, however, there was a slight change in fortunes for the Japanese sovereign currency.

At the end of the US trading session yesterday, the Yen hit 144 against the US Dollar, which is a six-day high.

It also spiked against the British Pound, before relapsing to a low at the end of the British session.

Reuters conducted a poll which sought the opinion of 23 economists, 12 of which stated yesterday that their opinion is that the Japanese government would not buy up the yen in order to stop the currency from weakening further. However, 5 respondents did note that if USD/JPY were to hit 150, then it would prompt intervention by Japanese officials.

Perhaps the speculation that interest rates will likely not be increased gave the Yen a quick boost in confidence, given that increasing rates has been a major policy in the United States and Great Britain throughout 2022, with some pundits thinking that interest rates may rise to 7% by January in the United Kingdom from their current 1.75% rate.

The reality is that banks are looking to increase interest rates to around 5% for mortgages, which is still a jump from the existing rates available in the United Kingdom, and the Pound has taken a bashing over serious concerns that the economy is in big trouble.

It's a volatile period for the Yen, and this blip is a case in point.

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Disclaimer: CFDs are complex instruments and come with a high risk of losing your money.

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ETHUSD and LTCUSD Technical Analysis – 22nd SEP, 2022

ETHUSD: Hammer Pattern Above $1220

Ethereum was unable to sustain its bullish momentum and after touching a high of 1393 on 21st Sep the prices started to decline against the US dollar. The prices of Ethereum touched a low of 1220 on 22nd Sep after which we can see a bounce upwards.

We can see a continued buying pressure today and we can see the formation of a bullish harami cross pattern in the 15-minutes time frame.

We can clearly see a hammer pattern above the $1220 handle which is a bullish pattern and signifies the end of a bearish phase and the start of a bullish phase in the markets.

ETH is now trading just above its pivot level of 1288 and is moving into a strong bullish channel. The price of ETHUSD is now testing its classic resistance level of 1298 and Fibonacci resistance level of 1308 after which the path towards 1400 will get cleared.

The relative strength index is at 47 indicating a NEUTRAL demand for Ether and a shift towards a consolidation phase in the markets.

We can see that the adaptive moving average AMA50 and MA50 both are giving a bullish trend reversal signal in the markets.

The STOCHRSI is indicating an OVERBOUGHT market, which means that the prices are expected to decline in the short-term range.

Most of the technical indicators are giving a STRONG BUY market signal.

Some of the moving averages are giving a BUY signal and we are now looking at the levels of $1400 to $1500 in the short-term range.

ETH is now trading below both the 100 & 200 hourly simple and exponential moving averages.

• Ether: bullish reversal seen above the $1220 mark
• Short-term range appears to be mildly BULLISH
• ETH continues to remain above the $1200 level
• The average true range is indicating LESS market volatility
  

Ether: Bullish Reversal Seen Above $1220

ETHUSD is now moving into a mildly bullish channel with the prices trading above the $1250 handle in the European trading session today.

ETH touched an intraday low of 1220 in the Asian trading session and an intraday high of 1297 in the European trading session today.

We have seen that the prices are near support of the channel indicating a bullish scenario.

The moving average MA100 is also indicating the bullish tone in the daily timeframe and now we are looking at the levels of 1500 to 1600 in the medium-term range.

The daily RSI is printing at 35 indicating a neutral demand in the long-term range.

The key support levels to watch are $1200 and $1258, and the prices of ETHUSD need to remain above these levels for the continuation of the bullish reversal in the markets.

ETH has decreased by 3.54% with a price change of 47.38$ in the past 24hrs and has a trading volume of 22.404 billion USD.

We can see an increase of 61.35% in the total trading volume in the last 24 hrs which is due to the heavy buying seen at lower levels by the medium-term investors.

The Week Ahead

The prices have been ranging into an oversold zone from last week and an upwards correction is expected. We are now looking for a sharp rally into the markets towards the $1600 levels.

The recent fall in the levels of Ethereum is attributed to the Federal Reserve which hiked the key interest rates for the third time this year.

The immediate short-term outlook for Ether has turned mildly BULLISH, the medium-term outlook has turned BULLISH, and the long-term outlook for Ether is NEUTRAL in present market conditions.

The prices of ETHUSD will need to remain above the important support level of $1200 this week.

The weekly outlook is projected at $1500 with a consolidation zone of $1400.

Technical Indicators:

The average directional change (14): is at 16.88 indicating a NEUTRAL level

The Williams percent range: is at -36.05 indicating a BUY

The bull/bear power (13): is at 12.62 indicating a BUY

The ultimate oscillator: is at 52.57 indicating a BUY

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Disclaimer: CFDs are complex instruments and come with a high risk of losing your money.

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AUD/USD and NZD/USD Face Key Hurdles, Downtrend Intact

AUD/USD is facing a strong resistance near the 0.6660 zone. NZD/USD is also struggling to clear the 0.5900 resistance zone.

Important Takeaways for AUD/USD and NZD/USD

• The Aussie Dollar started a fresh decline from well above the 0.6700 zone against the US Dollar.
• There is a key bearish trend line forming with resistance near 0.6650 on the hourly chart of AUD/USD.
• NZD/USD started an upside correction from the 0.5800 support zone.
• There is a connecting bearish trend line forming with resistance near 0.5850 on the hourly chart of NZD/USD.
  

AUD/USD Technical Analysis

The Aussie Dollar failed to stay above the 0.6700 level and started a fresh decline against the US Dollar. The AUD/USD pair traded below the 0.6650 support zone to move into a bearish zone.

There was a clear move below the 0.6620 level and the 50 hourly simple moving average. The pair traded as low as 0.6575 on FXOpen and recently started an upside correction. There was a move above the 0.6620 level.

AUD/USD Hourly Chart

The bulls pushed the pair above the 38.2% Fib retracement level of the downward move from the 0.6747 swing high to 0.6575 swing low.

However, the bears remained active near the 0.6660 zone and the 50 hourly simple moving average. The pair failed to clear the 50% Fib retracement level of the downward move from the 0.6747 swing high to 0.6575 swing low.

There is also a key bearish trend line forming with resistance near 0.6650 on the hourly chart of AUD/USD. On the upside, the AUD/USD pair is facing resistance near the 0.6650 level.

The next major resistance is near the 0.6660 level. A close above the 0.6660 level could start a steady increase in the near term. The next major resistance could be 0.6720.

On the downside, an initial support is near the 0.6600 level. The next support could be the 0.6560 level. If there is a downside break below the 0.6560 support, the pair could extend its decline towards the 0.6500 level.

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Disclaimer: CFDs are complex instruments and come with a high risk of losing your money.

 

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Watch FXOpen's September 19 - 23 Weekly Digest Video

In this video, FXOpen UK COO Gary Thomson sums up the week’s happenings and discusses the most significant news reports.

• The British pound hits 37-year low against US dollar
• How mobilization in Russia will affect financial markets
• US stock market complacency on the bankers' radar
• After a long period of hardship, the Japanese yen is back on track
  

Watch our short and informative video, and stay updated with FXOpen.

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Disclaimer: CFDs are complex instruments and come with a high risk of losing your money.

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Wow Nice Post!

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GBP/USD Nosedives and GBP/JPY Gain Bearish Momentum

GBP/USD started a major decline and traded below 1.1000. GBP/JPY is also diving and there was a clear move below the 155.00 support.

Important Takeaways for GBP/USD and GBP/JPY

• The British Pound started a major decline below the 1.1000 support against the US Dollar.
• There is a connecting bearish trend line forming with resistance near 1.1220 on the hourly chart of GBP/USD.
• GBP/JPY declined steadily after it failed to clear the 165.00 resistance zone.
• There is a major bearish trend line forming with resistance near 152.50 on the hourly chart.
  

GBP/USD Technical Analysis

This past week, the British Pound started a major decline from the 1.1400 zone against the US Dollar. The GBP/USD pair declined below the 1.1200 support to move into a bearish zone.

There was a steady decline below the 1.1100 level and the 50 hourly simple moving average. The pair even traded below the 1.0850 support zone. The pair traded as low as 1.0341 on FXOpen and is currently consolidating losses.

GBP/USD Hourly Chart

An immediate resistance on the upside is near the 1.0580 level. It is near the 23.6% Fib retracement level of the recent decline from the 1.1364 swing high to 1.0341 level.

The next major resistance is near the 1.0850 level. It coincides with the 50% Fib retracement level of the recent decline from the 1.1364 swing high to 1.0341 level, above which the pair could start a steady increase.

There is also a connecting bearish trend line forming with resistance near 1.1220 on the hourly chart of GBP/USD. An upside break above 1.1220 might start a fresh increase towards 1.1350. Any more gains might call for a move towards 1.1450 or even 1.1500.

An immediate support is near the 1.0450. The next major support is near the 1.0350 level. If there is a break below the 1.0350 support, the pair could test the 1.0200 support. Any more losses might send GBP/USD towards 1.0000.

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Disclaimer: CFDs are complex instruments and come with a high risk of losing your money.

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Slight opening gain as FTSE 100 wakes up

The doom and gloom that has surrounded the British Pound's seemingly endless fall from glory to almost parity with the US Dollar in its lowest point in recorded history has been a major consideration for traders across the world.

A clear indicator of the dire straits that the British economy finds itself in after many years of policy which has blown the coffers to an extent that there are serious concerns about how many people will manage to get through the winter, the Pound still languishes, but the FTSE 100 index has begun to increase just a few ticks this morning.

As the opening bell sounded in London this morning, analysts and traders began their day with a degree of optimism, expecting the London Stock Exchange's index containing its 100 most prestigious publicly listed companies to begin the day a few points higher than yesterday.

This mood was created by the Pound's slight slowdown in its apparent freefall, and news from the British government that the Treasury will hold a full Budget in the spring of 2023 and the Bank of England confirmed that it is keeping watch on markets and would not hesitate to raise rates.

The impending rate rises are a cause for concern, however, as a potential increase from the current rate of around 2.25% to over 5% by January is being speculated upon, and if that happens, it could well cause a serious issue for borrowers and plunge the economy into a recession.

In line with expectations, The FTSE 100 rose over 27 points in the opening session this morning in London, arriving at 7048.65, a gain of 0.4%. It extended a marginal overall rise notched up by the end of the previous session partially as a result of the news from the UK treasury.

Caution is still abound, however, especially as some mortgage lenders have removed some of the deals available in anticipation of increasing interest rates, giving rise to a possible notion that they are afraid of possible defaults should the rates go to over 5% as is being mooted by some analysts and investment banks.

This morning's upward movers on the FTSE 100 index were mainly some of the raw materials and resource stocks. Anglo American was up 50p to 2647p and Rio Tinto gained 69p to 4767p.

Given the anticipation that interest rates will rise to much higher levels than current ones, it is perhaps to be expected that the fallers on the FTSE 100 index today are house building companies. Persimmon stock dropped by 6p per share to 1258p, and Barratt stock fell 2.2p to 383p,

Rightmove, which is an online portal for real estate agencies to list their properties for rent or sale, saw its stock fall 4.4p to 545p per share.

In congruence with this, some of the major retail banks, NatWest and Lloyds notably, experienced falling share prices.

It's been a raw materials dominated world this year, and today's figures are no different.

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Disclaimer: CFDs are complex instruments and come with a high risk of losing your money.

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BTCUSD and XRPUSD Technical Analysis – 27th SEP 2022

BTCUSD: Double Bottom Pattern Above $18566

Bitcoin was unable to sustain its bearish momentum and after touching a low of 18279 on 21st Sep, the price has continued to escalate upwards and crossed the $20000 handle today in the European trading session.

This upside break was long overdue and now marks the beginning of rebound towards the $25000 level.

We can see the formation of bullish engulfing lines in the 15-minute and weekly time frames.

The momentum indicator is back over zero indicating a bullish scenario in both the 30-minute and daily time frames.

We can clearly see a double bottom pattern above the $18566 handle which is a bullish reversal pattern because it signifies the end of a downtrend and a shift towards an uptrend.

Bitcoin touched an intraday low of 19097 in the Asian trading session and an intraday high of 20310 in the European trading session today.

Both the STOCH and STOCHRSI are indicating overbought levels which means that in the immediate short term, a decline in the prices is expected.

The relative strength index is at 75 indicating an OVERBOUGHT market, and the possibility of some downwards correction due to profit taking by the medium-term investors.

Bitcoin is now moving above its 100 hourly simple moving average and below its 200 hourly exponential moving averages.

Most of the major technical indicators are giving a STRONG BUY signal, which means that in the immediate short term, we are expecting targets of 22000 and 23500.

The average true range is indicating LESS market volatility with a strong bullish momentum.

• Bitcoin: bullish reversal seen above $18566.
• The Williams percent range is indicating an overbought level.
• The price is now trading just above its pivot level of $20179.
• All of the moving averages are giving a STRONG BUY market signal.
  

Bitcoin: Bullish Reversal Seen Above $18566

The price of bitcoin continues to rise amid the buying pressure and improved investor sentiments. We are now looking at the important target levels of $22000 and $25000 in the medium-term ranges.

The adaptive moving averages AMA20 and AMA50 are both giving a bullish trend reversal signal in the 15-minute and daily timeframes.

We can see the formation of a bullish harami pattern in the 2-hour time frame.

We have also detected a bullish opening of the markets indicating the underlying bullish sentiment.

The immediate short-term outlook for bitcoin is bullish, the medium-term outlook has turned bullish, and the long-term outlook remains neutral under present market conditions.

Bitcoin’s support zone is located at $19000, and the price continues to remain above these levels for the continuation of the bullish reversal in the markets.

The price of BTCUSD is now facing its classic resistance level of 20253 and Fibonacci resistance level of 20298 after which the path towards 22000 will get cleared.

In the last 24hrs, BTCUSD has increased by 5.87% by 1120$ and has a 24hr trading volume of USD 48.845 billion. We can see an increase of 46.08% in the trading volume compared to yesterday, due to global buying pressure by the long-term investors.

The Week Ahead

The price of bitcoin is moving in a consolidation zone above the $20000 level. Further upsides are projected at $21000 and $22500 as the immediate targets.

The price of bitcoin reached its peak value of $69000 last year the month of November, and at the present level of $20000, we still need to recover ground towards the $40000 level, which if reached will mark a gain of 100% from the present market level.

The history of bitcoin price action shows that it is capable of doing so, and has done in the past.

The daily RSI is printing at 52 which indicates a neutral level and a move towards the consolidation phase in the markets.

The prices of BTCUSD will need to remain above the important support level of $19000 this week.

The weekly outlook is projected at $22000 with a consolidation zone of $21500.

Technical Indicators:

The moving averages convergence divergence (12,26): is at 323.90 indicating a BUY

The ultimate oscillator: is at 62.28 indicating a BUY

The rate of price change: is at 5.93 indicating a BUY

The average directional change (14): is at 51.06 indicating a BUY

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Disclaimer: CFDs are complex instruments and come with a high risk of losing your money.

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Big British banks pull mortgages: Pound tanks further while dollar soars

Perhaps the greatest anomaly of this year remains why the US Dollar has held such a strong value against other major currencies given that the United States economy has been subjected to similar obstacles that have affected its peers in Great Britain and on the European Mainland.

As this week began, the British Pound collapsed in value to a record low against the US dollar as investors rushed to sell the currency and government bonds in a demonstration of skepticism over new Prime Minister Liz Truss’s economic plans, however since then further displays of low confidence have surfaced.

Yesterday, 10 major retail banks in the United Kingdom removed a plethora of mortgage products from the market, and considerably reworked the terms available on some of the mortgage products which remain on the market, in order to manage potential risk if interest rates rise to the expected 5 to 6% by January.

Should such a level of interest rates be reached, this would increase payments on personal and commercial debt substantially, as currently the interest rate is around 2.6%.

This, combined with a tanking Pound, and inflation heading for 18% by January according to Citigroup analysts last month, is a combination of equations which do not make for a healthy borrowing environment.

By removing these mortgage products, the property market outside London has begun to be affected, and consumer activity including house purchasing is likely to be curtailed, which would slow down the economy even further.

The FTSE 100 responded to this accordingly yesterday, with house building company stock losing value whilst raw materials providers and mineral extraction giants rose in value.

It certainly appears that the commodities and materials sector is buoyant due to high demand, but anything requiring borrowing in order to purchase the final product is now sinking in value.

The Pound is now almost at parity with the US Dollar, as demonstrated earlier today during the Asian trading session when the British Pound reached a low point of $1.0327 against the US Dollar, surpassing the previous record low reached in 1985, before making back some of its value.

Precarious is an understatement. With banks mitigating risk on such a massive scale, it looks like the roller coaster ride is not yet over.

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Disclaimer: CFDs are complex instruments and come with a high risk of losing your money.

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ETHUSD and LTCUSD Technical Analysis – 29th SEP, 2022

ETHUSD: Bullish Engulfing Pattern Above $1257

Ethereum was unable to sustain its bullish momentum and after touching a high of 1400 on 27th Sep the price started to decline against the US dollar. The price of Ethereum touched a low of 1266 on 28th Sep after which we can see a bounce upwards.

We can see a continued buying pressure today and the formation of a bullish engulfing line in the 2-hour time frame.

We can clearly see a bullish engulfing pattern above the $1257 handle which is a bullish pattern and signifies the end of a bearish phase and the start of a bullish phase in the markets.

ETH is now trading just above its pivot level of 1321 and moving into a strong bullish channel. The price of ETHUSD is now testing its сlassic resistance level of 1327 and Fibonacci resistance level of 1331 after which the path towards 1400 will get cleared.

The relative strength index is at 53 indicating a NEUTRAL demand for Ether and a shift towards the consolidation phase in the markets.

We can see that the adaptive moving average AMA20, AMA50, and AMA100 are giving a bullish trend reversal signal in the markets.

The STOCHRSI and Williams percent range is indicating a NEUTRAL market, which means that the prices are expected to remain in a consolidation phase in the short-term range.

Some of the technical indicators are giving a STRONG BUY market signal.

Most of the moving averages are giving a BUY signal and we are now looking at the levels of $1400 to $1550 in the short-term range.

ETH is now trading above both its 100 & 200 hourly simple and exponential moving averages.

• Ether: bullish reversal seen above the $1257 mark
• The short-term range appears to be mildly BULLISH
• ETH continues to remain above the $1300 level
• The average true range is indicating LESS market volatility
  

Ether: Bullish Reversal Seen Above $1257

ETHUSD is moving in a mildly bullish channel with the price trading above the $1300 handle in the European trading session today.

ETH touched an intraday high of 1351 in the Asian trading session and an intraday low of 1313 in the European trading session today.

We have seen that the ichimoku price is over the cloud in the 1-hour time frame indicating a bullish scenario.

The Bullish harami pattern is observed in the weekly timeframe and MACD indicator is giving a bullish divergence signal in the 4-hour time frame.

The parabolic SAR indicator is giving a bullish reversal signal in the 30-minute time frame and now we are looking at the levels of 1450 to 1500 in the medium-term range.

The daily RSI is printing at 40 indicating a neutral demand in the long-term range.

The key support levels to watch are $1245 and $1285 and the prices of ETHUSD need to remain above these levels for the continuation of the bullish reversal in the markets.

ETH has increased by 4.27% with a price change of 54.65$ in the past 24hrs and has a trading volume of 16.127 billion USD.

We can see a decrease of 13.25% in the total trading volume in the last 24 hrs which is due to the shift towards a consolidation phase in the markets.

The Week Ahead

The price of Ethereum declined due the ongoing strength of the United States dollar and the increase in the market liquidity. We can see that now we are moving into a consolidation zone and the prices tend to move in a narrow range.

We are now looking for a fresh upside wave of correction towards the $1500 and $1600 levels.

We can see the formation of a bullish trendline in place from $1257 towards $1491 level.

The immediate short-term outlook for Ether has turned mildly BULLISH, the medium-term outlook has turned BULLISH, and the long-term outlook for Ether is NEUTRAL in present market conditions.

The prices of ETHUSD will need to remain above the important support level of $1250 this week.

The weekly outlook is projected at $1550 with a consolidation zone of $1500.

Technical Indicators:

The average directional change (14): is at 25.71 indicating a BUY

The rate of price change: is at 0.156 indicating a BUY

The bull/bear power (13): is at 1.606 indicating a BUY

The ultimate oscillator: is at 56.76 indicating a BUY

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Gold Price and Crude Oil Price Could Gain Bullish Momentum

Gold price started a recovery wave from the $1,615 level. Crude oil price could gain bullish momentum if it clears the $82.50 resistance zone.

Important Takeaways for Gold and Oil

• Gold price found support near $1,615 and started a recovery wave against the US Dollar.
• There was a break above a key bearish trend line with resistance near $1,658 on the hourly chart of gold.
• Crude oil price also started a recovery wave from the $76.00 zone.
• There is a major bearish trend line forming with resistance near $81.75 on the hourly chart of XTI/USD.
  

Gold Price Technical Analysis

Gold price declined heavily below the $1,700 level against the US Dollar. The price gained bearish momentum and declined below the $1,680 level.

There was a clear move below the $1,650 support zone and the 50 hourly simple moving average. The price traded as low as $1,615 and recently there was a recovery wave. The price was able to clear the $1,625 resistance zone.

There was a move above the 50% Fib retracement level of the downward move from the $1,687 swing high to $1,615 low. There was also a break above a key bearish trend line with resistance near $1,658 on the hourly chart of gold.

The price of XAU/USD is now trading above the 61.8% Fib retracement level of the downward move from the $1,687 swing high to $1,615 low.

On the upside, the price is facing resistance near the $1,670 level. The first major resistance is near the $1,680 level. The main resistance is now forming near the $1,688 level, above which it could even test $1,700.

A clear upside break above the $1,700 resistance could send the price towards $1,720. An immediate support on the downside is near the $1,655 level. The next major support is near the $1,650 level, below which there is a risk of a larger decline. In the stated case, the price could decline sharply towards the $1,620 support zone.

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Disclaimer: CFDs are complex instruments and come with a high risk of losing your money.

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UK Government ditches high-earner tax rate cut; Pound freefall halted for the moment

The British Pound's tremendous freefall has been staggering viewing over the past few weeks. Just when it looked like it would not fall lower, a sudden further drop ensued, bringing the Pound to almost parity with the US Dollar and creating a degree of speculation that perhaps the US Dollar, given its remarkable recent strength, would overtake the Pound and replace it as the world's most valuable currency.

This has not yet happened, and today as the week's trading begins, the British Pound has made a very slight step in the upward direction, albeit still at very low values compared to its high points six months ago.

As the London market opened this morning, the Pound had risen by 0.7% to US1.2453 and 0.20% to EUR0.982.

It is being considered that new further tax cuts which are being expected to be released by Prime Minister Liz Truss in which the highest tax rate, 45%, which is applied to higher earners in the UK, presented a serious risk to the economy, and had been met with great unpopularity by the electorate.

Today, the government announced that it would not proceed with the tax cuts, and that the high rate of tax will remain at 45%, which has gone some way toward curtailing the freefall that the British economy has been in for some months now.

The new government has been criticized for potentially assisting 'the rich' whilst the majority of small businesses and private individuals in the country struggle against extremely difficult economic circumstances.

It is of course easy for those saddled with a 45% tax burden to disagree with the way that the current government has been spending their tax, however in terms of actual percentage of taxable income, it is unlikely that keeping the high rate at 45% will cause a 'brain drain' - that being a term for highly educated, high earners to consider leaving the country.

This is largely because any other Western country which provides a lifestyle as good as that in the United Kingdom will likely have similar tax rates, therefore not much advantage would be gained.

Whilst the Pound's dramatic fall in value appears to have slowed, the FTSE 100 is now in the sights of observers. It is expected to open lower today following heavy losses in the US on Friday and with ongoing nervousness about the state of the UK finances.

There is no doubt that just keeping the top tax rate at 45% is not going to resolve the serious situation that the British economy is in.

Stocks listed on the FTSE 100 are large, blue-chip companies with vast shareholder bases, and their ability to perform well on their home market is a critical measure of investor confidence and equally a measure of the overall condition of British industry.

At the moment, housebuilders and financial services firms are down, whereas raw materials miners are up.

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Disclaimer: CFDs are complex instruments and come with a high risk of losing your money.

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GBP/USD Eyes Steady Recovery, EUR/GBP Faces Hurdle

GBP/USD started a recovery wave from a new low at 1.0341 and climbed above 1.1000. EUR/GBP is now facing a major resistance near 0.8870.

Important Takeaways for GBP/USD and EUR/GBP

• The British Pound started a fresh recovery wave above the 1.0920 resistance zone against the US Dollar.
• There was a break above a couple of bearish trend lines at 1.0700 and 1.0800 on the hourly chart of GBP/USD.
• EUR/GBP started a sharp decline and traded below the 0.8900 level.
• There is a major bearish trend line forming with resistance near 0.8830 on the hourly chart.
  

GBP/USD Technical Analysis

The British Pound found support near the 1.0340 zone against the US Dollar. The GBP/USD pair started a recovery wave and was able to clear the 1.0650 resistance zone.

There was a decent increase above the 1.0920 level and the 50 hourly simple moving average. The pair even climbed above the 1.1100 level. During the increase, there was a break above a couple of bearish trend lines at 1.0700 and 1.0800 on the hourly chart of GBP/USD.

A high was formed near 1.1234 on FXOpen and the pair is now correcting gains. On the downside, an initial support is near the 1.1070 level. It is near the 23.6% Fib retracement level of the upward move from the 1.0540 swing low to 1.1234 high.

The next major support is near the 1.0880 level. It is near the 50% Fib retracement level of the upward move from the 1.0540 swing low to 1.1234 high. Any more losses could lead the pair towards the 1.0750 support zone or even 1.0680.

On the upside, an initial resistance is near the 1.1230 level. The next main resistance is near the 1.1300 zone. A clear upside break above the 1.1300 and 1.1310 resistance levels could open the doors for a steady increase in the near term. The next major resistance sits near the 1.1500 level.

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Tesla in the doldrums as Elon Musk offers political advice

Tesla stock is one of the more volatile among big-cap publicly listed corporations, and the last day's performance has demonstrated once again that there is still a lot of uncertainty with regard to its values.

Tesla stock fell over 8.6% in value during yesterday's New York trading session, adding a further downturn to the 14.6% it has lost over the five day moving average.

Opinions vary on what caused this particular collapse in value, however it did coincide with reports that the company's record delivery figures for its electric cars had shown how challenging it can be to secure vehicle transportation capacity and at a reasonable cost, but surely there must be more to it than that?

Record deliveries of a product which is manufactured by a publicly listed company with shareholders to please usually brings confidence and Tesla's revolutionization of the entire automotive industry toward electric vehicles plus its standing as a huge market contender globally should go along with these record delivery figures nicely.

But it didn't.

Some dissenters consider that the entry level Tesla models such as the Model 3 and Model Y are quite simply not premium products, and despite their pricetag, are not much more well equipped or better engineered than budget cars from established brands in Europe and Asia at less than half the cost, giving rise to a possible feeling of marketing over substance.

That still wouldn't be enough to create such a downturn in share price though, because the cars are selling in high numbers and the revenues are pouring in more than ever.

Increased operating costs are one perhaps interesting area to examine. An expert in balancing the books, rival car manufacturer Ford Motor Company, recently said that inflation-related costs would be $1 billion more than expected in the third quarter and that parts shortages had delayed deliveries.

However, it may well be Elon Musk's tendency to go down the political path in the public arena that has had some effect.

Yesterday, Elon Musk said that, in the current geopolitical conflict, UN-supervised elections in four occupied regions that Moscow has falsely annexed after what it called referendums. "Russia leaves if it is the will of the people" he said, prompting a Twitter response from Ukrainian President Volodymyr Zelensky.

Politics and business often do not mix, and the more conservative investors often take a dim view of involvement in such situations which can create commercial risk.

Elon Musk is no stranger to that, of course, and has in the past caused crashes and booms by taking to Twitter to voice his opinion!

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BTCUSD and XRPUSD Technical Analysis – 04th OCT 2022

BTCUSD: Three White Soldiers Pattern Above $18527

Bitcoin was unable to sustain its bullish momentum and after touching a high of 20328 on 27th Sep, it started to decline touching a low of 18525 on 28th Sep. After this decline, the prices have stabilized and we can see an uptrend in the markets.

The prices have crossed the $20000 mark in the European trading session today.

We can see that the price is back over the pivot point in the weekly time frame.

The price of bitcoin is ranging near the horizontal support levels in the weekly time frame.

We can clearly see a three white soldiers pattern above the $18527 handle which is a bullish reversal pattern because it signifies the end of a downtrend and a shift towards an uptrend.

Bitcoin touched an intraday low of 19510 in the Asian trading session and an intraday high of 20099 in the European trading session today.

Both the STOCH and STOCHRSI are indicating overbought levels which means that in the immediate short term a decline in the prices is expected.

The relative strength index is at 74 indicating a STRONG demand for bitcoin, and the continuation of the buying pressure in the markets.

Bitcoin is now moving above its 100 hourly simple moving average and above its 200 hourly exponential moving averages.

Most of the major technical indicators are giving a STRONG BUY signal, which means that in the immediate short term we are expecting targets of 21000 and 22500.

The average true range is indicating LESS market volatility with a strong bullish momentum.

• Bitcoin: bullish reversal seen above $18527
• The Williams percent range is indicating an overbought level
• The price is now trading just above its pivot level of $19931
• All of the moving averages are giving a STRONG BUY market signal
  

Bitcoin: Bullish Reversal Seen Above $18527

The strong bullish rebound that is seen is expected to continue in the short-term range and now we are looking at $21000 and $22000 as the immediate targets.

The adaptive moving average AMA20 is giving a bullish crossover pattern in the daily timeframe.

The parabolic SAR indicator is giving a bullish reversal signal on the daily time frame.

We have also detected the ichimoku bullish crossover pattern on the 4-hour time frame.

The immediate short-term outlook for bitcoin is bullish, the medium-term outlook has turned bullish, and the long-term outlook remains neutral under present market conditions.

Bitcoin’s support zone is located at $19005 and the prices continue to remain above this level for the continuation of the bullish reversal in the markets.

The price of BTCUSD is now facing its classic resistance level of 20007 and Fibonacci resistance level of 200048 after which the path towards 21000 will get cleared.

In the last 24hrs, BTCUSD has increased by 3.80% by 730$, and has a 24hr trading volume of USD 31.762 billion. We can see an increase of 28.33% in the trading volume as compared to yesterday, due to increased demand for bitcoin globally.

The Week Ahead

The prices of bitcoin are moving in a bullish zone above the $19900 level. Further upsides are projected at $21000 and $22000 as the immediate targets.

We have seen continued buying pressure at lower levels, as we can see the formation of an ascending price channel from $18527 towards the $20214 levels.

The daily RSI is printing at 52 which indicates a neutral level and a move towards the consolidation phase in the markets.

The price of BTCUSD will need to remain above the important support level of $19000 this week.

The weekly outlook is projected at $21000 with a consolidation zone of $20500.

Technical Indicators:

The moving averages convergence divergence (12,26): is at 142.70 indicating a BUY

The ultimate oscillator: is at 60.39 indicating a BUY

The rate of price change: is at 1.75 indicating a BUY

The average directional change (14): is at 52.40 indicating a BUY

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Disclaimer: CFDs are complex instruments and come with a high risk of losing your money.

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EUR/USD Recovers Ground, USD/JPY Could Resume Uptrend

EUR/USD started a decent recovery wave above the 0.9900 resistance zone. USD/JPY is rising and might soon clear the key 145.00 resistance zone.

Important Takeaways for EUR/USD and USD/JPY

• The Euro formed a base and started a decent recovery wave above the 0.9800 zone.
• There is a major bullish trend line forming with support near 0.9910 on the hourly chart of EUR/USD.
• USD/JPY declined sharply before it found support near the 143.50 level.
• There was a break below a key bullish trend line with support near 144.55 on the hourly chart.
  

EUR/USD Technical Analysis

This past week, the Euro found support near the 0.9550 zone against the US Dollar. The EUR/USD pair started a steady recovery wave above the 0.9600 and 0.9680 resistance levels.

There was a steady increase above the 0.9800 resistance zone and the 50 hourly simple moving average. The pair even climbed above the 0.9900 resistance zone. A high was formed near 0.9998 on FXOpen and the pair is now correcting lower.

An initial support on the downside is near the 0.9940 level. It is near the 23.6% Fib retracement level of the upward move from the 0.9754 swing low to 0.9998 high.

The first major support is near the 0.9920 level. There is also a major bullish trend line forming with support near 0.9910 on the hourly chart of EUR/USD. The main support sits near the 0.9880 zone. It is near the 50% Fib retracement level of the upward move from the 0.9754 swing low to 0.9998 high.

An immediate resistance on the upside is near the 1.0000 level. The next major resistance is near the 1.0050 level. An upside break above 1.0050 could set the pace for another increase. In the stated case, the pair might revisit 1.0150.  Any more gains might send the pair towards 1.0200.

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Disclaimer: CFDs are complex instruments and come with a high risk of losing your money.