VOT Research Desk
Nov1
Market Analyitics and Considerations
Despite the fact that you may be attempting to profit from the US dollar’s rise relative to other major currencies, we still think signals of tiredness will be sold into.
Gold
The gold market tried to rebound earlier in the week, but it has since retreated from the 200-Weekly EMA and the pivotal $1680 level, which was formerly a highly significant sector. We may very well be getting set to test the $1620 level below, which is where we created a short-term double bottom, as we are closing toward the bottom of the candlestick. Gold is likely to fall all the way to $1500 if we finally break through that barrier, which we do believe we will accomplish. Watch the press conference that the Federal Reserve held late on Wednesday for hints.
BTC/USD
Although Bitcoin had a marginally better week, it is still essentially flat on its back. I don’t think Bitcoin has suddenly hit bottom, and if the Federal Reserve continues to be hawkish, maybe even in that press briefing on Wednesday, Bitcoin will probably take a beating. The $18,000 mark is a big, round, psychologically meaningful number, and it’s a place where there has historically been a lot of support. If that is broken, Bitcoin drops significantly. On the other side, rallies that reach levels of $25,000 do little more than keep us in the consolidation phase.
EUR/USD
During the trading week, the EUR/USD has surged pretty strongly to break over the parity level. As expected, the European Central Bank increased interest rates to a level of 2.00%. However, it appears that the market is not terribly thrilled since the day after such gains, selling activity picked up and we eventually dropped under parity. The subsequent candlestick resembles a shooting star, and it appears that we will keep moving down, especially if the Fed continues to be aggressive.
GBP/USD
The GBP/USD has risen for the majority of the week, crashing into a significant trendline. We’ve previously heard some noise at the 1.16 level, thus it will be vital to pay attention to. A prolongation of the “bear market bounce” made a lot of sense given that the British pound had already been severely oversold entering into this week. This is particularly the case now that the British have a new prime leader and appear to be going back on their terrible budget.
However, given that the UK still has a challenging winter ahead of it, We continue to think that indications of depletion will be played up. On the other hand, if you’re looking to profit from the US dollar’s resilience relative to other major currencies, you’ll probably find it simpler in contrast to the Euro or the Yen.
S&P 500
As we neared the 3900 mark, the S&P 500 E-mini contract rallied throughout the majority of the week. As of now, the market will be expecting to hear from the Federal Reserve on Wednesday.
It appears like everyone is trying to jump ahead of Jerome by speculating that the Federal Reserve would either slow down interest rate rises or possibly raise rates by only 50 basis points rather than the anticipated 75.Jerome Powell has a very strong chance of disappointing the bullish. Because they have inferred that the Reserve Bank of Australia and the Bank of Canada raising less money than expected is a sign of what the Federal Reserve would do, We predict that by the end of the week, the sellers will start buying again. Despite this, they entirely disregarded the ECB and the fact that they raised the expected amount of money.
Crude Oil WTI
Even though it started from a severely oversold position, the West Texas Intermediate Crude Oil market rallied during the week. Recently, there was an increase in prices, possibly as a result of the OPEC members cutting 2 million barrels per day, but it still seems to me that the markets were left with some unanswered issues. This market is expected to go notably higher if we can break above the highs from two weeks ago; before everything is said and done, it may even try to hit $120. On the other hand, if we were to fall below the $80 mark, oil may fall significantly.
DAX
Similar to most other stock markets, the Frankfurt exchange initially retreated a bit during the trading week before turning around and displaying signs of strength. Traders are now beginning to focus on the possibility that central banks might limit the tempo of interest rate increases, but to be honest, that’s not a positive indication since it demonstrates that there are still many economic hurdles present. Yes, it might give stocks a bounce in the short term, but there will still be a lot of downward pressure in the long run. The DAX could be somewhat choppy this next week, in our opinion.
USD/CAD
Throughout the trading week, the US dollar has fluctuated as a result of the Bank of Canada raising interest rates a little less than expected. However, others are attempting to draw the conclusion that because the Canadians did this, the Americans would undoubtedly raise less money than expected. However, looking at the weekly chart, I believe this is more a case of the market trying to shake off a load of hype because we had raced upward. It appears that we are still oscillating between the 1.35 and 1.40 levels. Because the Canadian dollar might be protected by the oil markets, We predict that this week will likely be more of the same.
