2023-10-31 22:25

EUR/USD, NASDAQ 100 OUTLOOK: The Fed’s interest rate announcement will take center stage on Wednesday A dovish monetary policy outlook could spark a rally in risk assets and weigh on the U.S. dollar. A hawkish outcome would have the opposite effect In this article, we scrutinize key technical thresholds for observation on the Nasdaq 100 and EUR/USD Most Read: Japanese Yen Craters after BoJ Fails to Appease Bears, USD/JPY & EUR/JPY Soar The Federal Reserve will disclose its penultimate monetary policy decision of the year tomorrow. Wall Street analysts expect the central bank to keep its benchmark rate unchanged in its current range of 5.25% to 5.50%. This puts the spotlight on forward guidance, particularly Chairman Powell's remarks during his press conference. In September, the Fed left open the possibility of additional policy firming this year, but conviction around further tightening has been waning of late, with several key officials indicating that the bond market is doing the work for them by tightening financial conditions via rising yields. Traders should closely heed Powell's views on this matter. If Powell expresses preference for another quarter-point hike in 2023, the Nasdaq 100 could take a strong hit. For its part, the U.S. dollar could climb sharply against the euro as traders reprice higher the Fed’s terminal rate. With the economy holding up remarkably well and inflation displaying notable stickiness, this scenario should not be completely ruled out at this stage. Conversely, if the FOMC chief adopts a more cautious stance and signals that the hawkish hiking campaign that began in 2022 has ended, there is scope for the Nasdaq 100 to stage a solid rally. The EUR/USD may also see an upturn, but any gains would be curtailed by the macroeconomic challenges confronting the Eurozone economy, including the potential threat of a recession. Keen to understand the role of retail positioning in EUR/USD's price action dynamics? Our sentiment guide delivers all the essential insights. Get your free copy today! EUR/USD TECHNICAL ANALYSIS EUR/USD retreated on Tuesday after failing to clear its 50-day simple moving average near 1.0695, with sellers back at the steering wheel at the time of writing. If weakness intensifies in the upcoming days, trendline support at 1.0535 may provide a buffer against further losses, unless a breakdown unfolds, in which case, we could witness a move toward the 1.0500 handle. On the flip, if the bulls engineer a strong resurgence and manage to push prices higher, initial resistance stretches from 1.0670 to 1.0695. Upside clearance of this region could rekindle upward momentum, paving the way for a move towards 1.0765, an important ceiling that corresponds to the 38.2% Fibonacci retracement of the July/October pullback. EUR/USD TECHNICAL CHART EUR/USD Chart Created Using TradingView NASDAQ 100 TECHNICAL ANALYSIS The Nasdaq 100 has rebounded from an area of cluster support that spans from 14,150 to 13,930, where the lower limit of the short-term descending channel aligns with the 200-day SMA and the 38.2% Fibonacci retracement of the October 2022/July 2023 rally. To create a potential route for a bullish comeback, confluence support in the 14,150/13,930 range must hold – failure to do so could set in motion a substantial pullback, potentially leading prices to 13,270, the 50% Fibonacci retracement. In the event that the bulls succeed in driving the Nasdaq 100 higher, initial resistance is located at 14,600. Successfully piloting above this barrier could boost buying interest, setting the stage for a climb towards 14,860. On further strength, the focus shifts to 15,100. NASDAQ 100 TECHNICAL CHART Nasdaq 100 Futures Chart Created Using TradingView https://www.dailyfx.com/news/forex-nasdaq-100-eur-usd-forecast-fed-policy-outlook-to-dictate-market-trend-20231031.html

2023-10-31 19:24

BITCOIN, CRYPTO KEY POINTS: Bitcoin Remains Below the $35k Mark and May Need a Catalyst for a Move Higher. Sentiment Around the Crypto Industry Continues to Improve. To Learn More AboutPrice Action,Chart Patterns and Moving Averages,Check out the DailyFX Education Series. READ MORE: Gold (XAU/USD) Prices Flirt with $2000 Level, Eyeing the FOMC Meeting for Fresh Impetus Bitcoin prices have taken a bit of a breather since the expansive rally that broke above the $35k mark last week Tuesday. Since then, it appears to be a case of uncertainty and rangebound trade but Bitcoin remains underpinned by hopes of the BlackRock Spot Bitcoin ETF approval. Supercharge your trading prowess with an in-depth analysis of gold's outlook, offering insights from both fundamental and technical viewpoints. Claim your free Q4 trading guide now! A sign of the strength and confidence from bulls is the lack of a significant pullback despite a resurgence in the DXY. The resurgence which has see many FX pairs and Gold lose ground to the Greenback has had very little impact on the price of Bitcoin. There has been a sizeable shift in market sentiment around Crypto markets and Bitcoin in particular over the past month or so. This is reflected in the image below as the crypto fear and greed index has risen from 48 a month ago to 66 today, which keeps it in “Greed” territory. Source: FinancialJuice The world's largest cryptocurrency ad crypto markets faced calls that it was dying toward the back end of 2022 before becoming the best performing asset of 2023. It does appear however that Crypto and blockchain technology are on their way to mainstream adoption. This is evidenced by the countless number of global institutions like JPMorgan, BNP Paribas and Santander are among those who are currently involved in various blockchain projects. The hype around the ETF is justified as we have heard comments from many asset managers and CEOs confirming they are fielding many enquiries and calls regarding diversification into Crypto. This hype seems to be underpinning Bitcoin right now so if we do have a rejection of the BlackRock Bitcoin ETF then we could be in for a deeper retracement. Right now, it does appear that that markets are leaning on the side of an approval, will we get it though? Source: TradingView READ MORE: HOW TO USE TWITTER FOR TRADERS TECHNICAL OUTLOOK AND FINAL THOUGHTS From a technical standpoint BTCUSD is currently stuck in a 2k range between the $33.3k and $35.3k. Price action is choppy as we appeared ready to make a new high before a bearish doji candle close yesterday hinting at a fresh low. However today we have seen the $34177 support area hold firm with the daily candle looking likely too close as a hammer candlestick. The question will be whether we can push on to make a fresh high above the $35.3k. Of course, we have the US FOMC meeting tomorrow evening which could stoke some volatility. However, looking at the resilience in Bitcoin today, I’m hesitant to say that a hawkish Fed will push Bitcoin prices lower. Today saw a sizeable rally in the DXY and still Bitcoin prices have held the high ground, a sign of the buying pressure still present. Key Levels to Keep an Eye On: Resistance levels: 35000 35300 37500 Support levels: 34177 32528 31493 BTCUSD Daily Chart, October 31, 2023. Source: TradingView, chart prepared by Zain Vawda https://www.dailyfx.com/news/bitcoin-btc-usd-technical-outlook-golden-cross-pattern-fails-to-inspire-higher-prices-what-next-20231031.html

2023-10-31 17:25

JAPANESE YEN FORECAST The Japanese yen depreciates sharply against the U.S. dollar and the euro after the Bank of Japan maintains its policy of negative rates and only modestly tweaks its yield curve control program Japan’s Ministry of Finance says it has not intervened in the FX market recently This piece examines the crucial technical levels for USD/JPY and EUR/JPY to monitor in the upcoming trading sessions Most Read: British Pound – GBP/USD and EUR/GBP Technical Outlooks The Japanese yen suffered large losses against the U.S. dollar and euro on Tuesday following Bank of Japan’s monetary policy announcement. In early afternoon trading in New York, USD/JPY was up about 1.5% to 151.35, a level it had not reached since October last year. Meanwhile, EUR/JPY was up around 1.2%, breaking above the 160.00 threshold and hitting its highest mark in 15 years. The BoJ maintained its benchmark rate unchanged at -0.10% and tweaked its yield curve control program, indicating that it would take a more flexible approach to controlling long-term rates. Under the new scheme, the institution would allow the 10-year government bond yield to rise above 1.0%, characterizing this level as a reference point rather than a rigid cap as previously considered. While the BoJ’s action is a step in the direction of dismantling its controversial accommodative position of the past decade, the measure didn’t live up to expectations after a media leak on Monday suggested that the institution, under Kazuo Ueda's leadership, was prepared to implement a more substantial and meaningful change to its current strategy. The yen’s drop was worsened by news that the Ministry of Finance had stayed out of FX markets recently. Traders believed that the government had taken measures to support the currency earlier this month, but official data contradicts this claim. This means that the high volatility experienced a few weeks ago, when USD/JPY broke above 150.00, was probably the result of trading algorithms. With the BoJ not yet ready to exit its ultra-dovish stance altogether and the Japanese government not doing much to contain FX weakness, rampant speculative activity could keep driving USD/JPY and EUR/JPY higher in the near term. This could mean fresh multi-year highs for both pairs heading into November. USD/JPY TECHNICAL ANALYSIS USD/JPY broke out on the topside, clearing the 151.00 handle on Tuesday hitting its highest level in more than 12 months. With bullish momentum on its side, the pair could soon challenge a key ceiling at 151.95, which corresponds to last year’s peak. On further strength, the focus shifts to channel resistance at 152.85. On the flip side, if the bears return and trigger a pullback, initial technical support becomes visible at 150.95. Breaching this floor could entice new sellers to enter the market, setting the stage for a retracement towards 148.90. Below this area, traders’ attention turns to the psychological 148.00 handle, followed by 146.00. USD/JPY TECHNICAL CHART USD/JPY Chart Created Using TradingView EUR/JPY TECHNICAL ANALYSIS EUR/JPY also blasted higher on Tuesday, capturing its strongest level in 15 years. Despite this outsize rally, the pair failed to clear trendline resistance at 161.00. For clues on the outlook, this technical zone should be watched carefully in the coming days, bearing in mind that a breakout could spark a move towards 162.80. In the unexpected event that sellers regain control of the market, support can be spotted at 159.70. Below this area, the focus shifts to 156.65 and 154.50 thereafter. EUR/JPY TECHNICAL CHART EUR/JPY Chart Created Using TradingView https://www.dailyfx.com/news/forex-japanese-yen-craters-after-boj-fails-to-appease-bears-usd-jpy-eur-jpy-soar-20231031.html

2023-10-31 15:30

XAU/USD, DXY PRICE FORECAST: Gold (XAU/USD) Rallies Above $2000/oz but the Move Proves Short-Lived as the DXY Recovers. Dollar Index (DXY) Advanced as Well in Light of Another Positive Data Release. IG Client Sentiment Shows that Retail Traders are Overwhelmingly Long on Gold. To Learn More About Price Action, Chart Patterns and Moving Averages, Check out the DailyFX Education Section. MOST READ: S&P 500 and Gold (XAU/USD) Take Diverging Paths Ahead of a Raft of Data Releases Gold prices fell to a low of around $1990/oz in the Asian session before a bounce in the European session has resulted in the precious metal regaining the $2000/oz handle. There is however quite a bit of selling pressure above the $2000/oz handle as the Dollar Index (DXY) also looks to be staging a US session recovery. Supercharge your trading prowess with an in-depth analysis of gold's outlook, offering insights from both fundamental and technical viewpoints. Claim your free Q4 trading guide now! US DATA, FOMC MEETING AND MIDDLE EAST TENSION US data continues to go form strength to strength with today's Consumer Confidence number beating estimates of 100 with a print of 102.6 in October. The September print was revised higher from 103 to 104.3, a further sign of the improvement in the outlook of consumers despite some recent challenges. The only concern from the data is the 1-year consumer inflation expectations which remains elevated at 5.9% with the 4-year inflation expectation number coming in at 5.9% as well. This is concerning for the Fed and market participants a his would hint that the Fed may need to do more and could explain in part the resurgence in the US Dollar Index (DXY). The FOMC meeting tomorrow is expected to result in a pause from the Fed tomorrow but given another round of solid data will Fed Chair Powell err on the Hawkish side? Comments around the door is open for another hike may not be hawkish enough for the DXY bulls to extend the recent rally beyond the 107.00 mark. The language from the Fed Chair will be of utmost importance at tomorrow's meeting and could stoke volatility as the rate decision is unlikely to do that. US Dollar Index, Daily Chart Source: TradingView, Created by Zain Vawda Looking at the Middle East situation and we are seeing a step up in attacks on US bases in the region while Israel conducted airstrikes on Hezbollah targets in Lebanon overnight. This could stoke tensions further and see safe-haven appeal return. This continues to drive markets and in particular Gold and can thus not be ignored. RISK EVENTS AHEAD The rest of the week brings some high impact data from the US with the FOMC meeting tomorrow evening, but before that we do also have manufacturing PMI data. Friday could prove to be more volatile as we have the NFP print as well as Services PMI data which is always massive for the US as it remains primarily a serviced driven economy. TECHNICAL OUTLOOK GOLD Form a technical perspective, Gold has struggled above the $2000 this week with today no different. The precious metal is failing to find acceptance above the level an extended rally to the upside as tension erupted in the Middle East. Looking ahead of tomorrow's FOMC meeting and we could see the precious metal remain rangebound ahead of the meeting. The range between $1980 and $2020 may remain intact as the precious metal looks for a catalyst to renew its bullish vigor. Key Levels to Keep an Eye On: Resistance levels: 2000 2007 2020 Support levels: 1990 1980 1969 Gold (XAU/USD) Daily Chart – October 31, 2023 Source: TradingView, Chart Prepared by Zain Vawda IG CLIENT SENTIMENT Taking a quick look at the IG Client Sentiment, Retail Traders are Overwhelmingly Long on Gold with 60% of retail traders holding Long positions. Given the Contrarian View to Crowd Sentiment Adopted Here at DailyFX, is this a sign that Gold may continue to fall? https://www.dailyfx.com/news/gold-xau-usd-prices-flirt-with-2000-level-eyeing-the-fomc-meeting-for-fresh-impetus-20231031.html

2023-10-31 13:30

British Pound – GBP/USD and EUR/GBP Technical Outlooks US dollar weakness helps GBP/USD push higher. Euro pushing higher against GBP despite weak data. The US dollar is caught in a small down draft, prompted by a sell-off in US Treasury yields. After hitting a multi-year high of 5.26% last week, the rate-sensitive US 2 year is now offered at 5.02%, while the benchmark US 10 year is quoted at 4.82%, down from just over 5.02% last Monday. While US yields may stay higher for longer, a commonly quoted Fed refrain, a raft of currencies are paring back some of their recent losses against the greenback, in the short term at least. Sterling is trading at a one-week high against the US dollar but further tests lie ahead for cable. On Wednesday the latest FOMC policy decision will be announced, followed by Fed Chair Jerome Powell’s press conference. The US central bank is expected to leave all policy levers untouched but Chair Powell’s post-decision commentary will be closely parsed for any clues on the health of the US economy. On Thursday, the Bank of England is also expected to leave interest rates unchanged, while the market will wait to hear the latest from BoE Governor Andrew Bailey at his post-decision press conference. Cable has short-term support between 1.2070 and 1.2090 with a break of the former opening the path to the October 4th low at 1.2038. A cluster of recent highs will see the pair struggle to break 1.2303 in the short-term, GBP/USD Daily Price Chart Euro Breaking News: EU GDP Contracts in Q3, Euro Rises The Euro has been strengthening against the British Pound over the last few weeks and has taken out a prior level of channel resistance. EUR/GBP is now trading at its highest level since early May and, more importantly, has broken above all three simple moving averages with conviction. Prior resistance now turned support around 0.8700 and should hold in the short-term with the 20-day sma at 0.8680 as the next level of support. If the Euro continues to firm then the next level of horizontal resistance is situated around 0.8828. EUR/GBP Daily Price Chart Charts using TradingView What is your view on the British Pound – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1. https://www.dailyfx.com/news/british-pound-gbp-usd-and-eur-gbp-technical-outlooks-20231031.html

2023-10-31 11:06

EU GDP, Inflation Breaking News EU economy contracts in Q3 (QoQ). Growth almost flat year on year German data yesterday revealed negative growth – Euro traded higher EU Economy Contracts but Inflation Reveals Signs of Continued Progress Economic growth in the euro zone contracted in Q3, following in the footsteps of Germany yesterday. The 0.1% contraction from the prior quarter confirms the challenging external environment as the global growth slowdown moves up a notch. However, the miss to the downside had not added to the euro’s woes and in fact the currency rose. Even yesterday, despite Germany’s economic contraction, the currency found some strength, although coming off a low base. EUR/USD is now on track for two days of gains, heading towards 1.0700 once more. The ECB signaled it is content with interest rates where they are and inflation continues to show signs of improvement, keeping stagflation fears at bay for now. In addition, recent Chinese stimulus announced by Beijing officials has acted to stem declines in Chinese and China related assets in recent days. With China being a sizeable trading partner, the stimulus measures could help stem euro declines. Next up, FOMC, Non-farm payrolls and US services PMI data. EUR/USD Daily Chart Source: TradingView, prepared by Richard Snow Europe’s largest economy Contracts but Data is Better than Initially Feared Germany, Europe’s economic powerhouse, contracted quarter on quarter as well as year on year to post dismal figures although, the data was not as bad as initially feared. @RichardSnowFX https://www.dailyfx.com/news/euro-breaking-news-eu-gdp-contracts-in-q3-euro-rises-20231031.html