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How to avoid being affected by inflation

For people who have a free, but not anarchic lifestyle, trading is another possibility to earn extra money. The most important factor is time, if you have it at your disposal, you can use it to make trades that lead you to live in a different way.

 

How to avoid being affected by inflation

Unfortunately, inflation is a very topical issue. At the time of writing, inflation in Europe is high and in Spain it has shot up to 8.7%. To sum it up quickly, inflation is how much prices are rising and the cause of money losing value. Realistic, analytical and scientific trading will increase your winning positions, get money back and, of course, protect you from inflation. This is because you will increase your income and avoid going into debt to continue living, which is unfortunately a very common practice.

 

We insist on the importance of training, doing trading is not to arrive and kiss the saint, it has a huge work behind that, too often, is not seen. If you have taken a stroll around the supermarket these days, you will have noticed that most of the products sold there are more expensive.

 

How to increase your savings

Many people who started out trading as a casual activity have gone on to make it a way to increase their income and, therefore, their ability to save. Trading is not about getting in and getting rich, in fact, those who go in with those intentions quickly achieve the opposite. If you keep a cool head and set aside a certain amount of your earnings, you will be acquiring financial freedom and you will have a basis for anything. Get the idea that trading is about casting the net and catching fish, not filling the boat immediately. If you are willing to make trading a way to hold on to your savings, you can do it as long as you take small steps.

 

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BTC USD - short-term price correction possible

The main driver of positive dynamics was the July data on US inflation: a slowdown in its growth to 8.5% made many investors hope that the peak of consumer price growth in the country has passed, and the indicator will now begin to move towards the target level of 2.0%, which may force the US Federal Reserve to abandon a sharp rate hike of 75 or 100 percentage points at the next meetings. It, in turn, became a catalyst for the active decline of the dollar against its main competitors. Also, the transition of the Ethereum network to the Proof-of-Stake (PoS) proof algorithm, scheduled for mid-September, arouses the interest of traders in the entire cryptocurrency market and “digital gold” in particular.

The price has rolled back down and not consolidated above 25000. Judging by the reversal of Stochastic near the overbought zone, the decline may continue to the middle line of Bollinger bands around 23650, and in case the quotes consolidate below it and 23437.5, return to 21875. Otherwise, growth will resume towards 25000, 26562.5, and 28125.

Resistance levels: 25000, 26562.5, 28125 | Support levels: 23437.5, 21875, 20312
 

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ETHUSD - Price growth may resume

Investors continue to show interest in the second world cryptocurrency against the background of the transition of the Ethereum network to the Proof-of-Stake (PoS) proof algorithm, which should happen very soon. Last week, the largest Goerli test network was transferred to PoS, and now users are waiting for September 15 or 16, when, according to the developers' calculations, the update will be activated on the main Ethereum blockchain. After switching to PoS, which should significantly increase the number of transactions processed, most investors expect further strengthening of the ETH price.

Technically, the ETHUSD pair is testing the support zone of 1895 - 1875, but the key for the "bears" is the level of 1750, supported by the middle line of the Bollinger Bands. If consolidated below it, the quotes will be able to fall to the levels of 1500 and 1375. The most important mark for the "bulls" remains 2000, the breakout of which will give the prospect of further growth to the levels of 2125, 2250.

Technical indicators generally point out the continuation of the upward trend: the Bollinger Bands are directed upwards, the MACD histogram is stable in the positive zone, and the Stochastic is directed downwards, which does not exclude the continuation of the downward correction, but is unlikely to lead to a reversal of the current trend.      

Resistance levels: 2000, 2125, 2250 | Support levels: 1750, 1500, 1375

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Key Releases

 

 

The USD today continues to strengthen against its main competitors – the euro, the pound and the yen.

 

Investors are still waiting for the publication of the minutes of the last meeting of the US Fed, which should be published on Wednesday. The document may contain comments on the latest increase in interest rates, as well as hints at further actions by the financial authorities. Thus, some investors believe that the slowdown in inflation in July from 9.1% to 8.5% can act as a catalyst for adjusting the indicator by 50.0 percentage points, while others tend to move to 75.0 percentage points, since the level of consumer price growth in the country remains extremely high and threatens the purchasing power of households. In this regard, we can note a review by analysts from The Goldman Sachs Group Inc., who believe that the decisions of the US Fed may be justified and not plunge the economy into a recession, but there is less and less chance of this. July data from the US construction market was also published today. The figures were mixed, with the number of building permits issued falling from 1.696M to 1.674M, better than the expected 1.650M, while the number of houses under construction corrected from 1.599M to 1.446M.

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The euro is weakening today against the USD and the pound, but is strengthening against the yen.

 

The focus of investors is the release of data on the index of economic sentiment from the Center for European Economic Research (ZEW) and trade data from the eurozone countries. Indicators in August showed negative dynamics: the value for the eurozone fell from -51.1 points to -54.9 points, and for the EU economic leader, Germany, from -53.8 points to -55.2 points, which is stronger than experts expected. In general, companies' biggest fear is that a continued rise in the cost of living will be reflected in private consumption and lead to a reduction in household spending. ZEW spokesman Michael Schroeder noted that high inflation and expected increases in heating and electricity tariffs are leading to lower profit expectations for companies. Also today came out the June data on the trade balance of the eurozone, which remained in deficit in the amount of 24.6B euros against the background of the rapid rise in oil and gas prices.

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The pound is weakening against the USD, but strengthening against the euro and the yen.

 

The data of the British labor market published today turned out to be generally weak: the unemployment rate in June remained the same and amounted to 3.8%, but employment increased only by 160.0K, which is lower than the forecasts of 256.0K, and the May indicator of 296.0K. At the same time, the level of wages continues to grow, which contributes to the development of inflation: excluding bonuses, the indicator increased by 4.75%, and including them – by 5.1%. However, it still does not keep up with the increase in prices, which creates additional pressure on the standard of living of citizens and may seriously reduce consumer demand in the future. This situation is likely to cause further sharp rate hikes by the Bank of England.

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The yen is weakening today against its main competitors – the USD, the euro and the pound.

 

In the absence of significant economic releases, the Japanese currency is traded under the influence of external factors. It is only worth noting that investors are preparing for the publication of foreign trade data for July. It is expected that the volume of exports of goods will slow down growth from 19.35% to 18.2%, and imports of products to Japan will be the June figure of 45.7%. The trade balance deficit will increase from 1.398B to 1.405B yen. Realization of forecasts may put additional pressure on the yen. We also note that the government is preparing a new package of support for the population in the amount of 4.7T yen, the details of which are not yet known, but experts believe that it will contain measures to curb rising fuel and food prices.

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The Australian dollar is weakening today against the pound and the USD, but is strengthening against the yen and has ambiguous dynamics paired with the euro.

 

In the focus of investors' attention is the publication of the minutes of the last meeting of the Reserve Bank of Australia (RBA). According to the document, the regulator still sees the need for a further increase in interest rates in order to prevent inflation from rising, but does not have a clear plan for tightening monetary policy and will try to prevent the economy from going into recession. It should be recalled that in August the RBA raised the rate by 50 percentage points, bringing it to 1.85%.

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Oil quotes are trying to grow today.

 

Oil quotes are attempting growth today, winning back yesterday's losses, but in general the situation on the market remains uncertain. The influence of two opposite factors is observed. On the one hand, investors fear a global economic slowdown that could hit demand for oil and fuel, as the latest economic data from China turned out to be weak: production rose by 3.8% instead of 4.6%, and retail sales – by 2. 7% instead of 5.0% expected. On the other hand, rising prices are supported by investors' hopes that the difficult economic situation will push the Chinese authorities to introduce new incentives that will revive the industry and demand. Chinese Premier Li Keqiang has already promised such measures. The situation with the “nuclear deal” between Western countries and Iran also remains ambiguous. Earlier, the authorities of the Islamic Republic gave a response to the new proposals developed by EU diplomats, but the text was not made public. During the day, investors are also waiting for the publication of a weekly report on the amount of oil reserves in the USA from the American Petroleum Institute (API). The last time the figure rose by 2.156M barrels. The continuation of this trend may put pressure on oil quotes.

 

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XRPUSD - Murrey analysis

The XRPUSD pair continues to rise for the third month in a row, correcting for a long-term downtrend as part of the overall market trend. The trading instrument has formed an ascending channel and is trying to resume growth from its lower border. The key “bullish” level is 0.3906 (Murrey [8/8]), a breakdown of which will give the prospect of further upward dynamics to 0.4150 (Murrey [+2/8]) and 0.4330 (Fibonacci correction 23.6%). To resume a serious decline, the price should drop below 0.3662 (Murrey [6/8]) and leave the ascending channel, in which case the targets of the downward dynamics will be 0.3418 (Murrey [4/8]), 0.3296 (Murrey [3/8]) and 0.3174 (Murrey [2/8]).

Technical indicators do not give a single signal: Bollinger bands are turning horizontally, the MACD histogram is stable in the positive zone, Stochastic reverses downwards, and the uptrend continues, however, a price reversal is not excluded soon.

Resistance levels: 0.3906, 0.415, 0.433 | Support levels: 0.3662, 0.3418, 0.3296, 0.3174

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Key Releases

USD is strengthening against its main competitors – EUR, GBP, and JPY.

The July data from the US construction market was published yesterday, which alarmed investors: the number of building permits issued decreased by 1.3%, and the volume of new homes – by 9.6%. Also, the American Association of Mortgage Bankers said that the demand for loans is at its lowest level since 2000, as potential home buyers are not ready to put up with high rates. Thus, the labor market is beginning to experience significant difficulties against the backdrop of a serious tightening of monetary policy, and some experts have already started talking about the onset of a recession in this particular economic sector. Poor July retail sales data in the US were released today, showing zero dynamics instead of the expected growth of 0.1%, as the effect of lower gasoline prices was leveled by a decrease in car sales. In the evening, investors are waiting to release the minutes of the US Federal Reserve meeting, from which they hope to find out whether the rate will increase by 75.0 basis points, as before, or by 50.0 basis points. Any hint of a monetary policy correction could cause significant price movement.

EUR is weakening against USD but is strengthening against JPY and GBP.

Q2 Eurozone macroeconomic data were published today: gross domestic product (GDP) grew by 0.6% QoQ and 3.9% YoY, slightly lower than the forecasted 0.7% and 4.0 % but still positive. Employment in the region is also increasing, albeit slower than before: by 0.3% QoQ and by 2.4% YoY. However, experts believe that the further economic prospects for the Eurozone are negative: GDP will begin to decline in the second half of the year under the pressure of high inflation and disruptions in supply chains. Most analysts believe that by the end of the year, the European economy will enter a recession, and next year's growth will be very insignificant.

GBP weakens against USD and EUR but strengthens against JPY.

Investors are focused on the publication of July data on inflation in the UK, where the consumer price index fell from 0.8% to 0.6% MoM, not justifying the analysts' forecast of 0.4%, and it rose from 9 .4% to 10.1% YoY, which is higher than the preliminary estimate of 9.8% and is the highest value since 1982. Experts say that the main driver of inflation is the increase in energy prices, which intensified after the start of the Ukrainian crisis, and they fear that the fight against it in the UK may last longer than in other countries. Under these conditions, the actions of Bank of England officials come to the fore, who have already adjusted the interest rate six times but so far have not been able to stop the rise in prices. According to calculations, the regulator is expected to continue its hawkish policy of tightening monetary parameters, which could catalyze an even deeper recession in the British economy in the year's second half.

JPY is weakening against its main competitors – USD, EUR, and GBP.

Investors are focused on the publication of the July data on foreign trade in Japan: the volume of exports increased by 19.0% instead of 18.2%, while the volume of imports added 47.2%, which is higher than the forecasted 45.7% and brought the trade balance deficit to 1.4368T yen. In general, the situation for Japanese companies remains difficult due to rising fuel prices and a weakening yen, and experts fear that the export-oriented national economy may begin to decline in the event of a global economic crisis. Also, today, poor June data on orders in the engineering sector was released, which is the main indicator of investment in production: the indicator rose by 0.9% MoM against the forecast of 1.3%, and the value fell from 7.4% to 6.5% YoY.

AUD is weakening against its main competitors – EUR, JPY, GBP, and USD.

AUD is under pressure amid the publication of data on the wage change index in the second quarter of this year: the indicator remained at the same level of 0.7% QoQ instead of the expected growth of 0.8%, and it rose from 2.4 % to 2.6% YoY, which is less than the forecast of 2.7%. Although wages are rising at the fastest rate in almost eight years, they still lag behind the pace of inflation, so consumer demand remains under pressure, worsening the economic situation in the country. On the other hand, a serious increase in wages caused by a shortage of qualified personnel could become a catalyst for a new wave of consumer price growth, as enterprises will shift the costs of hiring and retaining employees to buyers of their products. Under these conditions, the Reserve Bank of Australia (RBA) will be forced to continue aggressively raising interest rates, further increasing the risks of a recession in the national economy.

Oil quotes are trying to reduce.

The American Petroleum Institute (API) weekly report on energy inventories was released yesterday, which was generally positive for the market: the figure fell by 0.448M barrels, exceeding the forecasted decrease by 0.117M barrels, while gasoline inventories fell by 4.5M barrels. However, these data failed to strengthen fuel quotes significantly, as investors' fear of an impending global recession, supported by poor production data in China and July inflation statistics in the UK, continues to prevail. Today, markets are waiting for data on oil inventories from the Energy Information Administration of the US Department of Energy (EIA): the value may decrease by 0.0275M barrels, which will support energy prices.

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ADAUSD - Technical analysis

The ADAUSD pair is moving within a long-term downtrend, but since the middle of last month, it has attempted to grow, forming a short-term upward channel. Currently, under the influence of the delay in the activation of the Vasil update and the publication of the latest minutes of the US Federal Reserve, which confirmed the regulator's determination to continue raising interest rates, the price has dropped to 0.5280 (the middle line of Bollinger bands, the lower limit of the ascending channel). Consolidation below this level will give the prospect of quotes returning to 0.4882 (Murrey [4/8], bottom line of Bollinger bands) and 0.4638 (Murrey [3/8]). The key "bullish" level is 0.5615 (Murrey [7/8]), which has been repeatedly tested this week, and consolidation above which will allow the trading instrument to rise to 0.5859 (Murrey [8/8]), 0.6103 (Murrey [+1 /eight]).

Technical indicators do not give a single signal: Bollinger bands are directed upwards, the MACD histogram is increasing in the positive zone, and Stochastic is directed downwards. The level of 0.5280 is quite strong, so the return of the price to the upward movement within the short-term upward channel seems to be a more likely scenario.

Resistance levels: 0.5615, 0.5859, 0.6103 | Support levels: 0.5280, 0.4882, 0.4638

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Key Releases

The USD is weakening against the pound today and has ambiguous dynamics in pairs with the euro and the yen.

Investors are focused on the minutes of the last meeting of the US Fed, published earlier, which confirmed the “hawkish” mood of the regulator's members on the issue of adjusting monetary policy parameters until inflation begins to decline significantly. The calculated "neutral" level for them is the range of 2.25-2.50%. Department officials also noted that their actions will be based on economic data, which is the main difficulty for the market. After the US Fed meeting, the July inflation statistics were released, according to which the rate slowed down to 8.5%, and it is not yet known whether this will be enough to start adjusting the interest rate to 50.0 basis points. In addition, weekly data on the US labor market turned out to be better than experts' expectations: initial applications for unemployment benefits increased by 250.0K, which is lower than the 265.0K expected by analysts, and the total number of citizens receiving benefits reached 1.437M, which also inferior to the forecast of 1.438M.

The euro is weakening against the pound and the yen today and has ambiguous dynamics paired with the USD.

In the focus of investors' attention is the publication of the July data on inflation in the eurozone: the consumer price index fell from 0.8% to 0.1% on a monthly basis, and increased from 8.6% to 8.9% on an annual basis, while the base monthly value adjusted from 0.2% to -0.2%, and the annual value from 3.7% to 4.0%. A significant contribution to the growth of inflation was made by the increase in prices for electricity (by 4.02%), food products, alcohol and tobacco (by 2.08%). These data may force the European Central Bank (ECB) to take another rate hike in the near future, and possibly more serious than in July (by 50.0 basis points). Regulator board member Isabel Schnabel has already said that there were no noticeable results after the introduced measures, and her rhetoric was interpreted by investors as a signal of continued tightening of monetary policy in the future.

The pound is strengthening against the USD and the euro today and has ambiguous dynamics paired with the yen.

The British currency is recovering its positions lost after the release of weak July data on inflation in the UK. In general, the situation in the national economy remains unstable, and market participants are preparing for the onset of a recession. In the last week alone, consumer spending tracked by debit and credit cards fell by 0.7%, according to the UK Office for National Statistics, as high inflation continues to limit demand. We also note that Liz Truss, the leader of the election campaign for the post of Prime Minister of the country, who previously announced her intention to partially limit the independence of the Bank of England, has now turned her attention to other regulators. In particular, she is going to review the functions of the Financial Conduct Authority (FCA), the Prudential Regulatory Authority of the Bank of England (PRA) and the Payments System Regulator (PSR). The reason for this was the insufficient attention of these organizations to ensuring economic growth in the country.

The yen is strengthening against the euro today and has ambiguous dynamics in pairs with the pound and the USD.

In general, the Japanese currency is still under pressure from the release of negative July trade data, which recorded a serious predominance of the volume of imports over exports, which continued to grow due to the increase in prices for oil, coal and gas. The released data testify to the instability of the national economic recovery process and may give the Bank of Japan more arguments in favor of maintaining the current soft monetary policy. Tomorrow, investors expect the publication of the July data on inflation in Japan. The consumer price index is projected to fall from 2.4% to 2.2% on an annualized basis, while the base value will increase from 2.2% to 2.4%. In any case, the indicator will continue to remain above the target level of 2.0%.

The Australian dollar is weakening today against the euro and the pound, but is strengthening against the yen and the USD.

The focus of investors is the publication of the July data on the labor market, which turned out to be mixed: the unemployment rate fell from 3.5% to 3.4%, which is a forty-eight-year low. Total employment decreased by 40.8K instead of the expected growth by 25.0K, while full employment decreased by 86.9K. Thus, the labor market is beginning to experience pressure from the tightening of monetary policy by the Reserve Bank of Australia (RBA). Nevertheless, experts are confident that interest rates will continue to rise in the near future, since the problem of high inflation is seen by officials as the most dangerous for economic development.

Oil quotes continue to rise today.

Prices are supported by the report of the Energy Information Administration of the US Department of Energy (EIA), which recorded a serious reduction in the reserves of "black gold" by 7.056M barrels instead of the expected decrease by 0.275M barrels, and gasoline – by 4.642M barrels, with a forecast of 1.096M barrels. However, only distillate inventories rose insignificantly by 0.766M barrels. Meanwhile, there is still no clarity around the “nuclear deal” between the Western countries and Iran, which could provide an additional volume of cheaper energy to the market. The lack of new comments from Iran, the EU and the USA is alarming for investors.

Oil quotes are trying to reduce.

The American Petroleum Institute (API) weekly report on energy inventories was released yesterday, which was generally positive for the market: the figure fell by 0.448M barrels, exceeding the forecasted decrease by 0.117M barrels, while gasoline inventories fell by 4.5M barrels. However, these data failed to strengthen fuel quotes significantly, as investors' fear of an impending global recession, supported by poor production data in China and July inflation statistics in the UK, continues to prevail. Today, markets are waiting for data on oil inventories from the Energy Information Administration of the US Department of Energy (EIA): the value may decrease by 0.0275M barrels, which will support energy prices.

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Cryptocurrency Market Review

The cryptocurrency market has been actively correcting downwards this week. A sharp drop in prices occurred on Friday without obvious fundamental reasons, so experts attribute the loss of positions of digital instruments to the speculative activities of the "whales." BTC is currently trading around 21800.00 (–11.5%), ETH is at 1730.00 (–14.8%), USDT is around 1.0000 (–0.02%), USDC is at 0.9999 (+0.01%), while BNB is around 280.00 (–12.6%). The total market capitalization has decreased to 1.048T dollars, and the share of BTC in it was 40.01%.

Two opposite trends influenced the digital asset market. The pressure on quotes was exerted by the publication of the minutes of the last meeting of the Federal Open Market Committee of the US Federal Reserve (FOMC) but a serious drop in prices until Friday was hindered by the expectation of an early transition of the Ethereum network to the Proof-of-Stake (PoS) proof algorithm, which supported investor interest in the entire crypto sphere. The minutes of the meeting of the American regulator, released on Wednesday, confirmed that the increase in interest rates would continue until inflation shows serious signs of slowing down and moving towards the target level of 2.0%, so there is no break in the monetary policy tightening cycle expected, and this will continue to support the US currency against alternative assets. So far, the predictions of the head of Galaxy Digital, Michael Novogratz, who previously stated that the "hawkish" rhetoric of the financial authorities would put pressure on digital assets, and the BTC rate is unlikely to exceed 30000.00 by the end of the year, and most likely will remain in the corridor of 20000.00–30000.00.

From the news of the cryptocurrency community, we can note the problems of the stablecoin HUSD, previously presented by Huobi Global and Paxos as a safe and reliable asset that combines the stability of the US dollar and the efficiency of blockchain technology. The coin lost its peg to the dollar and dropped to 0.890 as FTX removed it from its stablecoin basket. Singapore-based cryptocurrency lending service Hodlnaut announced the need to reduce financial costs due to a police investigation. 80% of the staff has already been laid off.

We also note several European Central Bank (ECB) documents published this week. Thus, regulator officials reported that the introduction of state digital currencies is the only solution that guarantees the stable state of the current monetary system, as physical money loses its economic attractiveness and cryptocurrencies of large digital platforms continue to fill the market. Such comments prepare the European community for the imminent introduction of the digital euro, which should provide a serious alternative to private cryptocurrencies.

Next week, quotes of most cryptocurrencies may consolidate or continue to decline.

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NZDUSD - Technical analysis

H4
On the four-hour chart, there is the formation of a Three Black Crows candlestick analysis pattern, which means a continuation of the downtrend. In addition, under the resistance level of 0.6239, another Three Black Crows figure appeared, which confirms the previous pattern and emphasizes the strength of the "bears". However, at the moment, one can see the construction of the Morning Star reversal pattern above the level of 0.6152, which means that a strong support line has formed at the current level, where buyers have activated, but in order to fully confirm the reversal, the "bulls" should consolidate above the resistance level of 0.6239. In this case, the asset can restore positions to the zone of 0.6362 – 0.6475. If the trading instrument reaches the key support level of 0.6102 and consolidates below it, one should expect further downward movement to the range of 0.5929 – 0.5785.

D1
On the daily chart, at the level of 0.6362, there is the formation of a Hanging Man reversal pattern, after which the asset showed a decrease to the level of 0.6189. In addition, the movement was accompanied by the formation of the Three Black Crows candlestick analysis model, which included the Shooting Star candlestick. The combination of these figures may mean a continuation of the negative dynamics for the instrument after a short-term price rebound. It is likely that the NZD/USD pair will continue to lose positions after an upward correction to 0.6239, thus testing the broken down level, overcoming which will allow quotes to reach the area of 0.6102, where the buying zone is concentrated. If the "bulls" fail to hold this level, the asset may fall down to the level of 0.5785.

Support levels: 0.6102, 0.5929, 0.5785 | Resistance levels: 0.6239, 0.6362, 0.6475

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USD is strengthening against its main competitors – GBP, EUR, and JPY.
The July poor data on sales in the US secondary housing market were published yesterday: the figure fell from 5.11M to 4.85M or 5.9%. Earlier, it became known that the number of building permits issued decreased by 1.3%, and the volume of new housing construction – by 9.6%, so experts are already talking about the possibility of a recession in the construction sector. Nevertheless, the US labor market, which remains stable, continues to support the US economy, despite the weakness in other areas. Louis Fed President James Bullard said that the regulator was considering another significant rate hike in September and added that it is not yet possible to say with certainty that inflation in the country has reached its peak.

EUR weakens against USD but strengthens against GBP and JPY.
Today, the German Producer Price Index for July was published: the indicator rose from 0.6% to 5.3% MoM and 32.7% to 37.2% YoY. Growing inflationary pressures in the economy leave the European Central Bank (ECB) with no other option than a further tightening of monetary policy, which threatens the region with a recession. For example, Germany is already in serious trouble: according to the monthly report released yesterday by the Ministry of Finance, the outlook for the German economy is negative due to reduced gas supplies from Russia, persistently high prices for energy and other goods, and longer-than-expected disruptions in supply chains. Of the positive news, we can note the release of the June data on the balance of the current account of the Eurozone countries: the balance again became positive and amounted to 4.2B euros.

GBP is weakening against EUR and USD but has ambiguous dynamics against JPY.
GBP remains under pressure from poor inflation data for July, with the CPI rising from 9.4% to 10.1% YoY, higher than the forecasted 9.8% and the highest reading since 1982. Under these conditions, the Bank of England is likely to continue raising rates, increasing the risks of a recession in the economy. British retail sales for July released today were generally positive, rising by 0.3% MoM instead of an expected decline of 0.2% and falling by 3.4%, which, however, is less than June's 6.1%. However, these statistics failed to strengthen the pound's position, as the positive effect was leveled by the start of transport workers' strikes, which could put additional pressure on the national economy.

JPY is weakening against EUR and USD but has ambiguous dynamics against GBP.
Investors are focused on the publication of data on inflation in Japan for July: the nationwide consumer price index rose from 2.4% to 2.6% YoY, while the underlying value corrected from 2.2% to 2.4%. Thus, the indicator exceeds the target level of the Bank of Japan for the fourth month in a row, calling into question the statements officials that the rise in prices is a temporary phenomenon. However, soon, the Japanese regulator is unlikely to abandon the current ultra-soft monetary policy.

AUD strengthens against GBP and JPY but has ambiguous dynamics against EUR and USD.
Due to a lack of significant economic releases, AUD is traded under the influence of external factors. Investors are looking ahead to Monday when preliminary data on business activity for August are released in Australia. It is predicted that the value in the manufacturing sector will decrease from 56.2 points to 55.0 points, and for the service sector, it will increase from 50.9 points to 51.0 points. These statistics will give an idea of the state of the Australian economy and whether it can withstand the pressure of the current rate hike by the Reserve Bank of Australia (RBA).

Oil quotes are being corrected amid the strengthening of the USD and investors' fears about a slowdown in the global economy.
Experts believe that a significant increase in inflation in the Eurozone and the UK, a decline in production in China, and a weakening of the US construction market may reduce global oil demand. However, not all traders look at the situation pessimistically: for example, the new head of OPEC, Haitham Al Ghais, said that the global economy would cope with the current crisis and a decline in energy demand next year is possible but will not be serious.

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ETHUSD - Decline may continue

According to analysts, the fall of the second world cryptocurrency was caused by a serious decline in BTC, which pulled down all the major altcoins. It is likely that soon the trading instrument will remain in a state of uncertainty since two opposite factors will influence it. On the one hand, investors are waiting for the speech of the head of the US Federal Reserve, Jerome Powell, who may announce a further tightening of monetary policy or even hint at an increase in the rate of increase in the interest rate since the current inflation rate in the US, despite the rebound to 8.5%, is still very high. In this case, the US currency will receive additional support and strengthen its position against its main competitors. On the other hand, a further decline in quotes is hindered by the expectation of the transition of the Ethereum network to the Proof-of-Stake (PoS) proof algorithm. Now the developers are actively engaged in ensuring the security of smart contracts, and the update should take place on September 15 or 16.

However, the negative impact of monetary factors is still more serious than the upcoming upgrade of the Ethereum blockchain.

During the last few sessions, the trading instrument formed a sideways channel 1625–1520 (Fibonacci retracement 23.6%, Murrey [4/8]). The breakdown of the lower border of the channel and 1500 (Murrey [4/8]) will give the prospect of further decline to 1375 (Murrey [3/8]), 1250 (Murrey [2/8]). The key “bullish” level is 1750 (Murrey [6/8]), the middle line of Bollinger bands), which breakout will give the prospect of further growth to 1895 (Fibonacci correction 38.2%, Murrey [7/8]), 2030 (area of August highs).

Technical indicators do not give a single signal, demonstrating market uncertainty: Bollinger bands are horizontal, the MACD histogram is preparing to move into the negative zone, and Stochastic may leave the oversold zone.

Resistance levels: 1750, 1895, 2030 | Support levels: 1500, 1375, 1250

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