2023-10-28 12:03
The pound is trading near a six-month low reached earlier in October. UK jobs data indicated a decrease in inflationary pressures. The Bank of England (BoE) will likely maintain its current rates next week. The GBP/USD weekly forecast is bearish as investors have locked their eyes on the Bank of England (BOE), expecting the central bank to wrap up its tightening cycle. Ups and downs of GBP/USD The pound ended the week lower due to market apprehension amid the ongoing Middle East war, which boosted the dollar. All eyes are now focusing on the upcoming Bank of England meeting. Currently, the pound is trading near a six-month low of 1.2039, reached earlier in October. -If you are interested in automated forex trading, check our detailed guide- Notably, a UK jobs report on Tuesday indicated a decrease in inflationary pressures within the labor market. This data caused the pound to drop, as it reinforced expectations that the BoE would maintain its current interest rates at the upcoming meeting. Moreover, the British currency was vulnerable to global trends, particularly the dollar’s strength. Next week’s key events for GBP/USD Next week, GBP/USD traders will watch monetary policy meetings from the US and the UK. Markets are expecting the Fed to hold rates steady in November. Moreover, they are pricing an 80% chance of the same happening in December. Meanwhile, several reports this week confirmed the expectation that the Bank of England (BoE) will maintain its current rates during its policy meeting next week. The BoE will likely keep the rates unchanged at 5.25% on November 2, as per the consensus among most economists. Finally, market participants will focus on US employment data, which might show continued strength in the labor market. GBP/USD weekly technical forecast: Bears set to retest 1.2050 support. On the charts, the GBP/USD pair trades between the 1.2050 support and the 1.2324 resistance levels. Although the price is chopping through the 22-SMA, the RSI shows that bears have the upper hand. The RSI trades in bearish territory under 50. Moreover, the previous trend was bearish, with the price respecting the 22-SMA as resistance. It makes it likely the downtrend pauses as bears take a break. If you are interested in guaranteed stop-loss forex brokers, check our detailed guide- As such, there is a high chance bears will challenge the 1.2050 support in the coming week. A break below this support would continue the downtrend. However, if the price breaks above the 1.2324 resistance, we could see a bullish trend reversal. https://www.forexcrunch.com/gbp-usd-weekly-forecast-boes-tightening-nears-finish-line/
2023-10-28 11:57
The European Central Bank paused its aggressive monetary policy tightening. The US economy expanded by nearly 5% during the third quarter. Futures markets are almost certain the Fed won’t raise rates in November. In the EUR/USD weekly forecast, the winds are blowing with a distinctly bearish tone due to the recent decision by the ECB to hit the brakes on its rate hike campaign. Ups and downs of EUR/USD EUR/USD had a bearish week, where the European Central Bank paused its aggressive monetary policy tightening. Meanwhile, rising tensions in the Middle East and positive data supported the dollar. -If you are interested in automated forex trading, check our detailed guide- Since July 2022, the ECB has increased interest rates by 4.5 percentage points to address soaring inflation. However, they pledged to halt further rate hikes last month. This decision comes as the record-high borrowing costs are beginning to impact the economy. Elsewhere, the US economy expanded by nearly 5% during the third quarter. This growth was driven by increased wages resulting from a tight labor market. Next week’s key events for EUR/USD Next week will be eventful for the EUR/USD as the Federal Reserve will hold its monetary policy meeting. Moreover, the US will release data on employment. Futures markets are almost certain the Fed won’t raise rates in November. Moreover, they give an 80% probability of rate stability in December, as per CME’s FedWatch Tool. Policymakers plan to maintain the current key rate through most of 2024, which is longer than markets had expected. Meanwhile, the employment report could continue showing a robust labor market. EUR/USD weekly technical forecast: Bulls rally to reverse the trend. The EUR/USD price has gone above the 22-SMA on the daily chart. The move shows that bulls are attempting to reverse the trend. However, the RSI is still in bearish territory below 50, showing bears are also still strong. If you are interested in guaranteed stop-loss forex brokers, check our detailed guide- The price found strong resistance at the 1.0700 key level, where the price paused and fell to retest the 22-SMA. If the SMA is firm as support, the price will likely ascend in the coming week to retest and take out the 1.0700 resistance. However, if bears are still strong, as seen in the RSI, the price might break below the SMA and the 1.0500 key support level. Such a move would signal the continuation of the downtrend as it would lead to a lower low. https://www.forexcrunch.com/eur-usd-weekly-forecast-ecbs-hike-campaign-grinds-to-a-halt/
2023-10-27 12:29
The bias remains bullish as long as it stays above the uptrend line. The US data could bring high action later today. I’ve drawn a descending pitchfork, hoping to catch a new leg. The USD/JPY price is trading in the red at 150.01. After the last rally, a downside correction was due. Still, the bias is bullish despite temporary retreats. Yesterday, the price registered sharp movements in both directions, signaling an indecision. The DXY’s short-term retreat weakened the greenback, while the Japanese Yen Futures helped the Yen. -Are you interested in learning about the forex signals telegram group? Click here for details- Surprisingly or not, the price retreated even if the US reported positive economic data in the last trading session. Also, don’t forget that the ECB meeting had a big impact. Today, the Tokyo Core CPI registered 2.7% growth, beating the 2.5% expected and the 2.5% growth in the previous reporting period. Later, the US data should drive the markets. The Core PCE Price Index is expected to report 0.3% growth versus the 0.1% growth in the previous reporting period, while Revised UoM Consumer Sentiment could remain steady at 63.0 points. Furthermore, Personal Income may report a 0.4% growth again, while Personal Spending could announce a 0.5% growth. From the technical point of view, the USD/JPY pair retreated a little, but the bias remains bullish as long as it stays above the uptrend line. -Are you interested in learning about forex indicators? Click here for details- The price action developed a potential rising wedge pattern, but the formation is far from confirmed. After its amazing upward movement, a corrective phase could be natural. I’ve drawn a descending pitchfork, hoping to catch a new leg. Still, a potential larger correction could be activated only by a valid breakdown below the uptrend line and by the upper median line (UML) retest. Testing the uptrend line may announce new bullish momentum. https://www.forexcrunch.com/usd-jpy-price-loses-steam-above-150-0-eyes-on-us-pce/
2023-10-27 09:35
The ECB concluded a prolonged sequence of 10 consecutive rate hikes. The Eurozone economy is showing a significant slowdown. Investors increased their expectations for ECB rate cuts. The EUR/USD price analysis points south as the ECB held steady on interest rates. It concluded a prolonged sequence of 10 consecutive rate hikes. However, the ECB firmly stated that the growing talk of rate cuts in the market was premature. -Are you interested in learning about the forex signals telegram group? Click here for details- In its efforts to curb rapid price increases, the ECB has raised rates by 4.5 percentage points since July 2022. However, the bank pledged a pause last month as the exceptionally high borrowing costs began affecting the economy. With price pressures diminishing, inflation dropping by more than half within a year, and the economy showing a significant slowdown, a recession is possible. This scenario makes additional rate hikes unlikely. ECB President Christine Lagarde, repeating the guidance from six weeks ago, hinted at a steady policy in the near future. However, she offered little additional direction. She even left the door slightly ajar for the potential of future rate hikes, though as a distant possibility. Lagarde argued that the Eurozone economy appeared weak, possibly even weaker than predicted last month. However, she emphasized that price pressures remained robust. Moreover, they could intensify if the conflict in the Middle East led to increased energy costs. Despite her efforts to resist expectations of rate cuts, she couldn’t sway market sentiment. Investors remained unconvinced and increased their expectations for rate cuts, characterizing the guidance as “dovish.” Currently, markets indicate a significant likelihood of the ECB initiating interest rate cuts in April. EUR/USD key events today Investors are awaiting core inflation data with two major components, The core PCE price index (MoM) The core PCE price index (YoY) EUR/USD technical price analysis: 1.0525 support holds firm for now. The EUR/USD price is bearish on the charts as the price has fallen below 30-SMA. It has paused at the 1.0525 support level, where bulls are trying a rebound. However, with the price below the SMA and the RSI under 50, it will be hard for bulls to maintain the recovery. -Are you interested in learning about forex indicators? Click here for details- The highest price before bears return is the 30-SMA and the 1.0600 resistance level. A break above this zone would confirm a bullish takeover. However, given the bearish bias, the price will likely bounce lower to retest the 1.0525 and the 1.0500 support levels. https://www.forexcrunch.com/eur-usd-price-analysis-ecb-keeps-interest-rates-unaltered/
2023-10-27 08:30
Over the past three months, the pound has fallen by more than 6% against the US dollar. Money markets are pricing in no further BoE rate hikes. British retailers reported their worst October for sales volumes on record. Friday’s GBP/USD outlook is pessimistic as bearish sentiment persists near three-week lows amid dampened BoE rate hike expectations. Recently, economic data has reinforced the expectation that the Bank of England will hold rates unchanged at its upcoming policy meeting. -Are you interested in learning about the forex signals telegram group? Click here for details- According to Kirstine Kundby-Nielsen, an analyst at Danske Bank, the pound’s recent decline can be attributed to the BoE’s dovish comments. Moreover, there has been weaker-than-expected UK data and a growing market consensus that another rate hike is unlikely. Notably, the pound has fallen by more than 6% over the past three months against the US dollar. Meanwhile, data from Tuesday revealed a loosening labor market. Moreover, the flash reading of the S&P Global UK Purchasing Managers’ Index (PMI) for the services sector dropped to 49.2 in October. There was unexpected stability in September’s inflation at 6.7%, the highest among major advanced economies. However, the BoE is widely expected to maintain rates at 5.25% on November 2. Currently, money markets are pricing in no further rate hikes and are even considering rate cuts as early as June next year. Last Friday, BoE Governor Andrew Bailey stated that September’s inflation data was close to the central bank’s expectations. Further underscoring the economic challenges, British retailers reported their worst October for sales volumes on record. Moreover, they anticipate another tough month in November. This decline came as households grappled with the rising cost of living. GBP/USD key events today The US will release a significant inflation report comprising the following: Core PCE Price Index (MoM) Core PCE Price Index (YoY) GBP/USD technical outlook: Price hits a new low below 1.2100. The bias for GBP/USD on the 4-hour chart is bearish as the price made a lower low when it breached the 1.2100 key level. Although it has pulled back to trade above 1.2100, the bias remains strong as the price is below the 30-SMA. -Are you interested in learning about forex indicators? Click here for details- Additionally, the RSI shows strong bearish momentum trading below 50. Bears look prepared to continue the downtrend by retesting the 1.2100 support. A break below this support would push the price to retest the 1.2050 support, making a lower low. https://www.forexcrunch.com/gbp-usd-outlook-boe-rate-hike-prospects-weigh-on-pound/
2023-10-26 08:43
The Australian dollar reached a roughly two-week high after Australia’s inflation report. There is a 66% probability of a quarter-point increase to 4.35%. Business activity in the US improved significantly. After an unexpectedly robust inflation report, the AUD/USD price analysis took a bullish turn. The Australian dollar strengthened due to expectations of interest rate hikes. It surged to 0.7%, reaching a roughly two-week high of $0.6400 on Wednesday. Notably, Australia’s consumer price index increased by 1.2% in the third quarter. It surpassed the market expectations of 1.1% and was up from a 0.8% rise in the previous quarter. Consequently, traders began seeing higher chances of a potential interest rate hike by the RBA following four rate pauses next month. Futures markets are now placing a 66% probability of a quarter-point increase to 4.35%, up from 35% before the data release. Meanwhile, two major Australian banks, the Commonwealth Bank of Australia and ANZ, shifted their stance on Wednesday. They abandoned their previous view of a rate pause. Both now anticipate a quarter-point hike in November. Such a move would position the RBA as one of the few central banks in the developed world still pursuing a tightening policy. Meanwhile, markets believe the US Federal Reserve and the European Central Bank have completed their rate hikes. Elsewhere, business activity in the US improved significantly. S&P Global reported on Tuesday that its flash US Composite Purchasing Managers Index reached its highest level since July. This development might give the US Federal Reserve more flexibility to maintain elevated interest rates. AUD/USD key events today Investors are expecting several important reports from the US, including: The building permits report. The new home sales report. A speech from Fed Chair Jerome Powell. AUD/USD technical price analysis: Bulls’ key to uptrend lies at 0.6400. AUD/USD 4-hour chart On the charts, Aussie is bullish as the price shot up from the 0.6350 support level to the 0.6400 resistance. A strong move occurred above the 30-SMA, showing that the bulls are in control. Additionally, there is support from the RSI, which trades in bullish territory. However, on a larger scale, the price has been stuck in a sideways move, chopping through the SMA. Therefore, this may continue if bears take over at 0.6400 resistance. For the price to start trending up, bulls must break above the 0.6400 resistance. https://www.forexcrunch.com/aud-usd-price-analysis-surprising-inflation-bolsters-aussie/
