PPI input +3.6% q/q
- prior 1.1%
PPI output +2.6% q/q
- prior 1.4%
more to come
Articles
Polkadot price signals “weak hands holding” as bears aim for $4
May 19, 2022 06:51 FXStreet Market News
- DOT price is on a steep decline.
- Polkadot price has breached buyers’ territory on the Relative Strength Index.
- Invalidation of the bearish trend is a breach at $14.25.
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 is due for more decline.
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 Price Analysis: Bulls regain control, and target the 200-hour SMA at 0.8517
May 19, 2022 06:51 FXStreet Market News
- On Wednesday, the EUR/GBP recorded gains of 0.42%, erasing Tuesday’s losses.
- A dampened market mood weighed on the risk-sensitive British pound.
- EUR/GBP Price Forecast: The 1-hour chart depicts the formation of a falling wedge preceded by an uptrend, with the 200-hour SMA as its target.
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.
EUR/GBP Price Forecast: Technical outlook
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.
Key Technical Levels
Full ArticleAUD/USD braces for Australia employment data below 0.7000, risk-aversion in play
May 19, 2022 06:45 FXStreet Market News
- AUD/USD pares the biggest daily loss in a week, picks up bids of late.
- Risk appetite worsens on inflation, covid fears, softer Aussie, China data also strengthened bearish impulse.
- Australia’s jobs report for April will be eyed amid chatters of RBA’s 40 bps rate hike.
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.
Technical analysis
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 ArticleAustralian jobs market report coming up Thursday 19 May 2022 – growth in jobs expected
May 19, 2022 06:33 Forexlive Latest News Market News
The report is due at 0130GMT.
This
snapshot (below) is from the ForexLive economic data calendar, access
it here.
- The
numbers in the right-most column are the ‘prior’ (previous month)
result. - The
number in the column next to that, where is a number, is the
consensus median expected.
Westpac are looking for a below-consensus headline result:
- 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 unemployment rate move downwards (Westpac f/c: 3.9%).
Canada says China has lifted its restrictions on Canadian canola (after 3 year ban)
May 19, 2022 06:26 Forexlive Latest News Market News
The Canadian government has announced that China has lifted its restrictions on Canadian canola.
The ban had been in place for around 3 years – a three-year-old trade dispute. Market access for two Canadian canola companies has been reinstated.
Info via Canadian media reporting.
Full ArticleEUR/USD sees a downside to 1.0400 as risk-off mood looms, EU Consumer Confidence in focus
May 19, 2022 06:26 FXStreet Market News
- EUR/USD is expecting more downside on souring market mood.
- Sustained Eurozone HICP numbers are compelling for a rate hike by the ECB.
- The DXY has rebounded sharply on improvement in safe-haven appeal.
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 ArticleJPMorgan cuts US GDP estimates for 2022 and 2023
May 19, 2022 06:21 FXStreet Market News
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.”
FX implications
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.
Read: Forex Today: Dollar soars as Wall Street plunges
Full ArticleJPMorgan has cut its US GDP estimates for both 2022 and 2023
May 19, 2022 06:17 Forexlive Latest News Market News
The narrative has shifted for equity market losses, from at first being about rising interest rates and tightening financial conditions, to now being also about growth/earnings worries as inflation erodes spending power and profits.
This via Reuters with updated JPM forecasts showing slower growth expected ahead:
- H2 GDP 2.4% (from 3%)
- H1 2023 1.5% (from 2.1%)
- H2 2023 1% (from 1.4%)
JPM say there may be enough of a growth slowdown to lead to a gradual increase in the unemployment rate later in 2023, this will alleviate some of the wage pressures that have been building.
“In short, we forecast a soft landing, but are well aware that this outcome has rarely (if ever) occurred,”
SPX (weekly candles):
Deutsche Bank says S&P500 to 3650, then as high as 4800 by the end of this year
May 19, 2022 06:09 Forexlive Latest News Market News
Deutsche Bank with their latest SP500 forecast, says it’ll fall to 3,650
- this would be a 24% decline, which is an average recession decline
DB citing:
- growth is slowing
- thus earnings-led declines for stocks, valuations are vulnerable
DB says that if the labour market can hold up and growth is not hit too hard then they see a year-end rally to 4,700 / 4,800
Weekly S&P500 candles:
AUD/JPY Price Analysis: Broke a bearish flag and accelerates towards 89.00 and beyond, as bears eye 87.30
May 19, 2022 06:09 FXStreet Market News
- On Wednesday, the AUD/JPY grinds lower by almost 2% on weak Aussie data and dismal sentiment.
- A bearish flag in the 1-hour chart targets 88.40, but the market mood could drive prices towards 88.00.
- AUR/JPY Price Forecast: In the 1-hour chart is downward biased and could aim towards 87.30 if bears achieve a daily close below 88.40.
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.
AUD/JPY Price Forecast: Technical outlook
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.
Key Technical Levels
Full ArticleGold Price Forecast: XAU/USD remains steady around $1,820 despite the freaky risk-off impulse
May 19, 2022 06:09 FXStreet Market News
- Gold price has turned topsy-turvy despite negative market sentiment looms.
- Fed policymaker is expecting two more jumbo rate hikes in June and July.
- A 40.00-60.00 range of the RSI (14) is indicating rangebound moves going forward.
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.
Gold technical analysis
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.
Gold hourly chart
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