Polkadot price looks weaker than most digital assets. Before opening a position, traders should consider giving the digital asset more time to consolidate or invalidate the downtrend.
Polkadot price signals weak hands in the market as the bulls are failing to establish price action above the bearish engulfing candle that suppressed the DOT price into the current $10 zone. From a technical point of view, DOT price displays nothing worth considering as a serious argument for a countertrend tally. In fact, the slope of the current decline resonates with wave three price action. Secondly, the Relative Strength Index has a newly breached buyers zone on the 4-day chart,
Polkadot price failure to hint at a countertrend rally like other cryptocurrencies in the space warrants the idea of bullish exhaustion. At best, one can expect diminishing returns for the Polkadot price and, at worst, a $4 low to wipe out long-term buyers’ interest in the market. The ramping pattern on the volume indicator adds further confluence to the bearish thesis.
DOT/USDT 4-Day Chart
Invalidation of the bearish thesis lies at $14.25. If the bulls breach this level, a $22 target for the DOT price could be in the cards, resulting in a 125% increase from the current Polkadot price.
EUR/GBP recovers some ground after falling towards the 50-day moving average (DMA) at around 0.8396, though it is staging a recovery during the day but faltering to break above the 0.8500 mark, settling at around 0.8470s. At 0.8481, the EUR/GBP sits above the 200, 50, and 100-DMA and is ready to re-test the one-year-old downslope trendline, broken on May 6, though later reclaimed by EUR/GBP bears.
Risk-aversion keeps risk-sensitive currencies like the British pound under pressure. That benefits the shared currency, which despite recording losses against the greenback, its low-yield status vs. the pound, attracts investors as they seek safe-haven protection.
During the overnight session for North American traders, the EUR/GBP opened near the lows of the session, around 0.8440, and rose once EU inflationary readings crossed wires, at the same time that UK’s figures showed that inflation reached 9%. Both news caused a jump near the 0.8500 mark, but EUR bulls could not pierce the figure, retreating towards the 100-hour simple moving average (SMA) at 0.8479.
The 1-hour chart depicts the pair as neutral biased but slightly tilted to the upside. EUR/GBP traders need to be aware of a falling-wedge chart pattern formed after a bullish impulse, meaning that once broken, the EUR/GBP should aim higher, targeting the 200-hour SMA at 0.8517.
However, for that scenario to play out, EUR/GBP traders would need to break above 0.8500. Break above would expose the 200-hour SMA at 0.8517, which, once cleared, would open the door for further gains around the R2 daily pivot at 0.8530, followed by the R3 pivot point at 0.8560.
AUD/USD reverses the pullback from the weekly top, after posting the biggest daily fall in a week, as traders prepare for the all-important Australia employment report for April. Even so, the broad risk-off mood probe the recovery moves near 0.6975-80 amid the early Thursday morning in Asia.
Market sentiment soured the previous day with the usual catalysts, namely inflation and growth, weighing down the risk appetite. Higher inflation numbers from the UK, Eurozone and Canada appear to be fueling the fears of slowing growth moving forward. The same could be witnessed in the recently watered-down US Gross Domestic Product (GDP) forecasts from the leading banks.
Elsewhere, Shanghai’s refrain from total unlocks and an increase in covid cases in mainland China joined fresh virus-led activity restrictions in Tianjin, the port city near Beijing, also contributing to the risk-aversion and weighing on AUD/USD prices.
Additionally, downbeat prints of Australia’s Westpac Leading Index for April, Q1 2022 Wage Price Index and China’s housing numbers were also responsible for the AUD/USD pair’s downside. It’s worth noting that the US housing data for April gained little importance as the flight to safety underpinned the US Dollar Index (DXY) to post the biggest daily gains of a week, not to forget snapping the previous three-day downtrend.
Amid these plays, Wall Street benchmarks saw the red while the US 10-year Treasury yields dropped 11 basis points (bps) to 2.88% by the end of Wednesday’s North American trading session.
Looking forward, Australia is up for publishing April month employment data that bears upbeat forecasts with the headline Employment Change likely rising to 30.0K from 17.9K previous readout whereas the Unemployment Rate is expected to ease to 3.9% versus 4.0% prior.
“Given that weekly payrolls suggest weather and holiday events dampened jobs growth in April, Westpac anticipates employment to lift by 20k for the month. The participation rate holding flat at 66.4% should see the unemployment rate move downwards (Westpac f/c: 3.9%),” said Westpac ahead of the release.
AUD/USD reverses from 100-SMA on 4H, around 0.7035 by the press time, for the third time in a month as MACD teases bears, suggesting further downside towards the weekly bottom surrounding 0.6870.Full Article
The EUR/USD pair is attempting to find a cushion around 1.0460 after a sheer downside move from 1.0564 recorded on Wednesday. A thunderous FX arena on a soaring risk-aversion theme brought a swift sell-off in the risk-sensitive currencies. The asset sees more weakness as negative market sentiment is still dominating the global markets.
The shared currency bulls found barricades near their crucial resistance at 1.0550 after the Eurostat reported the Harmonized Index of Consumer Prices (HICP) on Wednesday. The annualized Eurozone HICP landed at 7.4%, a little lower than the estimates and prior figure of 7.5%. The euro bulls are facing tremendous pressure despite a minor fall in the HICP numbers as investors have started believing that the inflationary pressures will persist longer due to supply chain issues and the Eastern European crisis. To contain the ramping up inflation, European Central Bank (ECB) policymakers advocate a rate hike cycle to start with a quarter-to-a-percent rate hike in July.
On the dollar front, the US dollar index (DXY) has rebounded sharply amid an improved safe-haven appeal. The DXY is oscillating marginally below 104.00 and is expected to overstep the round-level resistance as market sentiment may remain negative for a little longer. Also, Philadelphia Federal Reserve (Fed) Bank President Patrick Harker has favored two 50 basis points (bps) rate hikes in June and July.
This week, the Eurozone Consumer Confidence will remain in focus. The confidence of the European consumers is expected to improve to -21.5 against the prior print of -22.Full Article
JP Morgan cut its expectation for US real Gross Domestic Product (GDP) for the second half of 2022 and for 2023, per Reuters.
The details suggest that the firm’s economic and policy research department cut its second half view to 2.4% from 3% and cut its first half 2023 target to 1.5% from 2.1% and for the second half of 2023 it cut its view to 1% from 1.4%.
The forecast report also mentions, “It said there may be enough of a growth slowdown to lead to a gradual increase in the unemployment rate later next year, helping to relieve some wage pressures that have been building.”
In the end, the research led by economist Michael Feroli concludes, “In short, we forecast a soft landing, but are well aware that this outcome has rarely (if ever) occurred.”
Fears of inflation and growth are omnipresent nowadays and exert major pressure on the risk assets. The same weighs on the Antipodeans and underpins the US dollar strength. That said, the US Dollar index snapped a three-day downtrend on Wednesday whereas the AUD/USD prices declined the most in a week the previous day, around 0.6970 by the press time.Full Article
The Australian dollar gave back its Tuesday’s gains after Wednesday’s Asian Pacific session began on the wrong foot, once the Wage Price Index (WPI) rose lower than estimations, meaning that expectations of a 40-plus bps rate hike by the Reserve Bank of Australia (RBA) wane, putting 25-bps instead in play. At the time of writing, the AUD/JPY is trading at 89.22.
Sentiment remains dismal, as shown by US equities tumbling between 3.57% and 5.06%. Asian stocks point to a lower open, and those factors in the FX market weighed on risk-sensitive currencies, like the AUD, the NZD, the CAD, and the GBP.
During the Asian session, the Australian economic docket featured the Q1 Wage Price Index rose by 2.4% y/y, lower than the 2.5% estimated, while the quarterly reading grew 0.7%, also less than the 0.8% foreseen. Even though both figures grew more than the previous period, they are trailing the high inflationary pressures in Australia, with the inflation rate reported at 3.7%, the highest since 2009, and headline inflation reaching 5.1%.
Once the data is in the rearview mirror, that would likely deter the RBA from increasing the size of tightening monetary policy, as some banks backpedaled from expecting a 40-bps rate hike to a 25-bps one.
Meanwhile, during the overnight session for North American traders, the AUD/JPY opened around 90.89, but once the Aussie WPI was released, the cross-currency pair tumbled, following the AUD/USD, which also erased Tuesday’s gains. That said, the AUD/JPY fell below the 50, 200, and 100-hour simple moving averages (SMAs) each at 990.44, 90.19, and 89.77, respectively, and settled around 89.10s.
From a daily chart perspective, the cross stills neutral-upward biased, but failure at 91.00 leave the pair vulnerable to further selling pressure, which means that the AUD/JPY might tumble towards 87.30 before resuming the uptrend.
The AUD/JPY 1-hour chart depicts the pair as downward biased. The ascending channel, which depicted a bearish flag, kept the price within those boundaries until it finally broke around 90.10, which exacerbated the cross fall towards 89.10s.
That said, the AUD/JPY first support would be the 89.00 mark. Break below would expose the S1 daily pivot at 88.44, followed by the 88.00 mark, and the S2 daily pivot at 87.72, before reaching the abovementioned 87.30 YTD low.
Gold price (XAU/USD) is oscillating in a tight range of $1,815.64-1,822.05 in the early Asian session despite the market mood jitters on soaring inflation worldwide. The precious metal has not been affected by intensified negative impulse in the FX domain. Risk-sensitive currencies have taken a bullet and global equities have witnessed an intense sell-off on Wednesday as the risk-off impulse heightened.
The gold prices are untouched amid carnage in the risk-perceived assets while the US dollar index (DXY) has rebounded sharply after hitting a low of 103.20 on Wednesday. Earlier, the DXY eased 1.5% from its 19-year high at 105.00 recorded last week.
Meanwhile, Philadelphia Federal Reserve (Fed) Bank President Patrick Harker has dictated that the Fed is expected to feature two 50 basis points (bps) interest rate hikes in June and July’s monetary policy meetings. Later, it will stick to a traditional quarter-to-a-percent rate hike to contain the price pressures.
The gold prices are expected to react to risk sentiment and the movement of the DXY amid the unavailability of any major economic event in the US that could result in a decisive move for the bright metal.
On an hourly scale, gold prices have rebounded sharply after successfully testing their previous lows at $1,807.72. The precious metal has formed a Double Bottom chart pattern that signals a bullish reversal on lower selling volume while testing the previous lows. The 20- and 50-period Exponential Moving Averages (EMAs) at $1,817.37 and $1,816.43 respectively have turned flat, which signals a directionless move. Meanwhile, the Relative Strength Index (RSI) (14) is oscillating in a 40.00-60.00 range that signals the further auction in a tight range.
At 0.6294, NZD/USD is under pressure in the open of Asian trade due to generalised rout in risk assets. The moves in markets come on the heels of the US Federal Reserve Chair Jerome Powell who amplified a strong hawkish tone yesterday, pledgeding to ratchet up interest rates as high as needed, including taking rates above neutral, in order to cap runaway inflation that he said threatened the foundation of the economy.
The initial reaction in markets immeadiately after the interview with the Walls Street Journal was a firmer US dollar and risk-off in financial markets, but the moves were soon pared and the US benchmarks rallied to fresh highs on the day.
However, all of this was reversed on wednesday when the retailer, Target, reported that higher-than-expected costs ate into its quarterly earnings. The stock fell over 25% and was tracking its worst day since the Black Monday crash on Oct. 19, 1987, highlighting worries about the US economy after the retailer became the latest victim of surging prices.
Consequently, the Dow Jones Industrial Average tumbled by 3.6% to 31,490.07 while the S&P 500 plunged 4% to 3,923.68. The Nasdaq Composite was 4.7% lower at 11,418.15. The US 10-year yield fell by 8.6 basis points to 2.88%.
”Big beats to UK and Canadian CPI stoked inflationary fears, and US retailer stocks have been hammered. So we’re back to watching the ebb and flow of global risk appetite again, and it’s still volatile, and showing no real signs of basing,” analysts at ANZ bank said.
”Budgets don’t tend to be as important for FX as they are for bonds, but anything that clearly upsets the fragile fiscal sustainability/growth/
Algorand price action has recovered a significant amount of last week’s losses, but the technical structure screams of a bearish continuation move. First, however, sellers need to show a clear rejection of higher prices – so far, this has not happened.
Algorand price is at a make-or-break point on its daily Ichimoku chart. Today is exactly one week from the flash crash made on May 12. Since that crash, Algorand has made an impressive 40% gain off those lows – but those gains are now at risk of being wiped out.
A standard bearish continuation pattern known as a bear flag is currently present. Bear flags are upwards moving channels that occur after a downtrend, then typically weaken or lose momentum before sellers return and resume downside pressure to new lows.
The critical price level that bears will want to target is a daily Algorand price close at or below $0.44. A close at $0.44 would be the lowest close in five days and position ALGO just a hair above last Tuesday’s flash crash close and below the open. ALGO has an open path to the 2022 low at $0.34. However, Algorand price may move lower than $0.34, possibly to the 2020 Volume Point of Control at $33.
ALGO/USDT Daily Ichimoku Kinko Hyo Chart
If bulls want to invalidate any further downside pressure, then, at a minimum, they’ll need to close Algorand price above the Tenkan-Sen at or above $0.50. But the road above $0.50 has many strong resistance levels, some sharing the same value area, which exacerbates that resistance. As a result, any near-term upside potential is likely limited to the 2022 Volume Point of Control at $0.75.
As per the prior analysis, AUD/USD Price Analysis: Bulls rest up at 50% mean reversion target, the price has started to melt from the resistance of the 50% mean reversion area on the daily chart. There are now prospects of a downside continuation for the days ahead.
The price is being met by sellers at the resistance zone and should the bears commit beyond the 0.6950s, the case for a downside continuation of the broader bear trend will be strong.
From a four-hour perspective, the price has moved in on what could be a support zone, resulting in a reversion to retest the old support near 0.6990. If bears commit to there, then the path of least resistance will likely be to the downside for a fresh daily low towards 0.6750/70.Full Article
Gold spot (XAU/USD) is trading negative in the day, though it remains at familiar levels, trapped in the $1800-20 region amid the lack of a catalyst that can push the bright metal beyond its current boundaries. At the time of writing, XAU/USD is trading at $1813.69
Gold remains on the defensive, despite having a risk-off environment, which usually helps the yellow metal. However, US dollar strength overshadows XAU/USD’s prospects, as the greenback gains some 0.18% against a basket of currencies, portrayed by the US Dollar Index at 103.486. Also, on Tuesday, Federal Reserve Chair Jerome Powell said that “What we need to see is inflation coming down in a clear and convincing way, and we’re going to keep pushing until we see that. If that involves moving past broadly understood levels of ‘neutral,’ we won’t hesitate at all to do that.”
Meanwhile, some financial analysts believe that the Fed will struggle to achieve a soft economic landing, meaning that it could cause a recession if needed to bring inflation down. This environment could be positive for gold, but bulls have been unable to challenge the 200-DMA at around $1837, much less the $1890 level, which needs to be reclaimed if they aim to lift prices above $1900.
Analysts at TD Securities wrote in a note that “With downside momentum firming among the precious metals complex, and broad macro liquidations also weighing, we continue to see further downside potential for gold. ETF holdings have fallen for a ninth straight day while positioning analytics still argue for the potential of additional pain for gold bugs.”
Macroeconomic-wise, the US docket featured Building Permits and additional housing data, which came mixed. Building Permits rose to 1.819 million, higher than the 1.812 million foreseen, but Housing Starts increased by 1.724 million, lower than the 1.765 million estimated, beginning to show signs of the Federal Reserve tightening. Later in the day, Philadelphia’s Fed Patrick Harker will cross wires.
At the time of writing, XAU/USD is trading below the two-year-old upslope trendline, drawn from September 2018 swing lows, as depicted by the weekly chart. It’s also worth noting that the 50-week moving average (WMA) crossed under the 100-WMA, each located at $1831.76 and $1840.96, respectively, a signal of sellers’ strength entering the market.
With that said, XAU/USD’s first support would be $1800. A breach of the latter would put the YTD lows at $1780.18 in play, a level that needs to be broken by gold bears if they aim to push prices towards $1700. Once XAU/USD bears reclaim $1780.18, the last line of defense would be December 15, 2021, swing low at $1752.35, followed by $1700.
Reuters reported that Philadelphia Federal Reserve Bank President Patrick Harker on Wednesday said he expects the US central bank to deliver two more half-point rate hikes before switching to quarter-point increments until the “scourge” of inflation is beaten back.
“Going forward, if there are no significant changes in the data in the coming weeks, I expect two additional 50 basis point rate hikes in June and July,” Harker said in remarks prepared for delivery to the Mid-Size Bank Coalition of America.
“After that, I anticipate a sequence of increases in the funds rate at a measured pace until we are confident that inflation is moving toward the Committee’s inflation target.”
While the comments have had no direct impact on markets, there is an undertone of hawkishness at the Fed that is roiling markets on Wednesday.
As a consequence, the US dollar is firmly higher on Wednesday, on pace to snap a three-session losing streak. Rising inflation has knocked sentiment following yesterday’s WSJ interview with the Federal Reserve Chair Jerome Powell who struck a more hawkish tone.Full Article