official Daily Market Analysis By FXOpen

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EUR/USD Gains Momentum, USD/CHF Eyes Upside Break

EUR/USD started a decent increase and it broke the 1.1800 resistance zone. USD/CHF is rising, but it is facing a major resistance near 0.9185-0.9190.

Important Takeaways for EUR/USD and USD/CHF

• The Euro started a fresh increase from well below 1.1700 against the US Dollar.
• There is a major bullish trend line forming with support near 1.1800 on the hourly chart of EUR/USD.
• USD/CHF started a fresh increase from the 0.9120 support zone.
• There was a break above a key bearish trend line with resistance near 0.9165 on the hourly chart.

EUR/USD Technical Analysis

The Euro formed a support base above 1.1680 and started a fresh increase against the US Dollar. The EUR/USD pair broke the 1.1750 resistance zone to move into a positive zone.

The pair even surpassed the 1.1800 resistance zone and it settled above the 50 hourly simple moving average. Finally, there was a spike above the 1.1840 level. A high was formed near 1.1845 on FXOpen before the pair started a downside correction.

There was a break below the 1.1820 and 1.1810 levels. The pair declined below the 23.6% Fib retracement level of the upward move from the 1.1734 swing low to 1.1845 high.

It is now consolidating above the 1.1800 support zone. There is also a major bullish trend line forming with support near 1.1800 on the hourly chart of EUR/USD. The next major support is near the 1.1790 level.

It is near the 50% Fib retracement level of the upward move from the 1.1734 swing low to 1.1845 high. The main support is near the 1.1780 level. A downside break below the 1.1780 support could start another decline.

On the upside, an initial resistance is near the 1.1820 level. The main resistance is near 1.1850. If there is an upside break above the 1.1850 resistance zone, the price could rise steadily towards the 1.1920 resistance zone.

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NO SIGNIFICANT RESISTANCE ON BITCOIN’S PATH TO $100,000

Bitcoin will continue the rally that started in August, and after successfully breaking through the psychological resistance level of $50,000, it could further grow to reach $100,000 with minimal resistance, says Bloomberg's analyst and strategist Mike McGlone.

“After enduring a gut-wrenching correction, we see the crypto market more likely to resume its upward trajectory than drop below the 2Q lows. What could stop Bitcoin and Ethereum from achieving record highs in 2H may be the more elusive question. Increasing demand and adoption are facing diminishing supply,” McGlone wrote in his report.

Meanwhile, JPMorgan analysts have warned the investors about the “frothy-looking” crypto markets and unstable prices over the long term. They have also noted that the factors boosting the BTC price include continued interest from institutional investors and the general public.

The chart seems to confirm this optimism. An inside bar with low volumes was formed on Saturday, and on Sunday, the price rose paired with increasing volumes. Taking into account the decline in activity typical for a weekend, we see an indication that the market is more interested in rallying than balancing around the 50k level.

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Eurozone Inflation at 10-Year High Ahead of the September ECB Meeting

Inflation is running hot all over the world, and the Eurozone could not differ. Ahead of the ECB meeting scheduled this Thursday, the inflation rate in the Euro area reached a 10-year high.

Unlike the Federal Reserve of the United States, the ECB has only one mandate – price stability. The ECB measures price stability by bringing inflation below but close to 2%. It recently adjusted its target to a more symmetrical one, something similar to the average inflation targeting in the United States.

But the bottom line is that the ECB only looks at inflation before changing its monetary policy. The Fed, on the other hand, looks at inflation and job creation. Therefore, while inflation is way above the target in the United States, the Fed will not act on rates until the job market recovers. As we saw last Friday, the last NFP report disappointed – the U.S. economy only created one-third the jobs the market expected.
The Euro Trades with a Bid Tone Ahead of the ECB Meeting

The common currency, the euro, bounced recently from its lows. The EUR/USD exchange rate is up from below 1.17 and traded briefly above 1.19 after last Friday’s NFP report in the United States.

Similar to the EUR/USD, the EUR/JPY is in a bullish trend too. It regained the 130 level and trades with a bid tone.

The market expects that the ECB will signal the removal of its monetary accommodation, and thus the euro is bid against its peers. However, the risk is that the ECB will do nothing and the recent strength in the euro pairs will vanish.

All in all, an interesting week for financial markets lie ahead. Inflation is a problem in Europe, and the ECB will likely reiterate its view that inflation is transitory. If that is the case, and the ECB does nothing to address inflation fears, the euro bulls will be disappointed.

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NATURAL GAS SETTING NEW RECORDS IN THE US AND EUROPE

On Monday, September 6, US natural gas futures reached the mark of $4.7 per million Btu. This is the highest index since December 2018.

Such a hike in gas prices was triggered by Hurricane Ida: production in the Gulf of Mexico is not going according to plan. The demand for home air conditioning is likely to remain as strong, since it will be as hot in early September.

In Europe, the gas price has climbed even higher due to shortage fears. The threat of shortage stems from the fact that Russia, the largest gas supplier to Europe, has refused to book large volumes of gas pumped through pipelines in Ukraine ahead of the completion of the Nord Stream 2 pipeline.

From a technical point of view, the chart shows that gas prices have reached the overbought level and the line of the long-term upward channel. This increases the likelihood of a rollback.

Whether you would like to take a risky position against an uptrend, or wait for a pullback (for example, closer to the strong support of 4.200 or 4.500) to enter a long position at the end of it, FXOpen is ready to be your reliable partner.

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EUR/USD Could Resume Decline While USD/JPY Aims Higher

EUR/USD extended its increase before it faced sellers near 1.1910. USD/JPY is rising and it might revisit the 110.40 resistance zone.

Important Takeaways for EUR/USD and USD/JPY

• The Euro failed to gain pace above 1.1900 and started a downside correction.
• There was a break below a major bullish trend line with support near 1.1875 on the hourly chart of EUR/USD.
• USD/JPY started a fresh increase and it cleared the 110.00 resistance zone.
• There was a break above a key bearish trend line with resistance near 109.95 on the hourly chart.

EUR/USD Technical Analysis

This past week, the Euro saw a steady increase above the 1.1800 zone against the US Dollar. The EUR/USD pair broke the 1.1850 resistance to move into a positive zone.

The pair even spiked above the 1.1900 level, but it failed to extend gains. A high was formed near 1.1908 on FXOpen before the pair started a fresh decline.

There was also a break below a major bullish trend line with support near 1.1875 on the hourly chart of EUR/USD. The pair traded as low as 1.1837 and it is now consolidating losses.

An immediate resistance is near the 1.1855 level. It is near the 23.6% Fib retracement level of the recent decline from the 1.1908 swing high to 1.1837 low. The first key resistance is near the 1.1865 level and the 50 hourly simple moving average.

The 50% Fib retracement level of the recent decline from the 1.1908 swing high to 1.1837 low is also near 1.1865. A close above 1.1865 could open the doors for a steady increase towards 1.1900.

If there is no break above 1.1865, the pair might continue to move down. An immediate support is near the 1.1840. The next major support is near 1.1820, below which the pair could drop towards the 1.1750 support in the near term.

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AUD/USD and NZD/USD Could Start Fresh Increase

AUD/USD is forming a base above 0.7345 and it could start a fresh increase. NZD/USD might also start a steady increase above the 0.7135 resistance zone.

Important Takeaways for AUD/USD and NZD/USD

• The Aussie Dollar is forming a decent support base near the 0.7350 zone against the US Dollar.
• There was a break above a key bearish trend line with resistance near 0.7375 on the hourly chart of AUD/USD.
• NZD/USD is also forming a base above the 0.7075 pivot level.
• There was a break above a major bearish trend line with resistance near 0.7100 on the hourly chart of NZD/USD.

AUD/USD Technical Analysis

After struggling to clear the 0.7470 resistance, the Aussie Dollar started a downside correction against the US Dollar. The AUD/USD pair broke the 0.7400 and 0.7375 support levels to move into a short-term bearish zone.

The pair even broke the 0.7360 support and the 50 hourly simple moving average. A low was formed near 0.7345 on FXOpen before the pair started a recovery wave. There was a break above the 0.7375 zone and the 50 hourly simple moving average.

There was also a break above a key bearish trend line with resistance near 0.7375 on the hourly chart of AUD/USD. The pair cleared the 23.6% Fib retracement level of the recent decline from the 0.7468 swing high to 0.7345 low.

An immediate resistance is near the 0.7390 level. The next major resistance is near the 0.7400 level. It is close to the 50% Fib retracement level of the recent decline from the 0.7468 swing high to 0.7345 low.

A close above the 0.7400 level could start a steady increase in the near term. The next major resistance could be 0.7450. An initial support on the downside is near the 0.7370 level. The next major support is near the 0.7345 level. If there is a downside break below the 0.7345 support, the pair could extend its decline towards the 0.7300 level.

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GBP/USD Eyes More Upsides While GBP/JPY Remains At Risk

GBP/USD started a fresh increase above the 1.3800 resistance. GBP/JPY seems to be facing a major resistance near the 152.20 and 152.30 levels.

Important Takeaways for GBP/USD and GBP/JPY

• The British Pound traded as low as 1.3727 before it started a fresh increase against the US Dollar.
• There was a break above a major bearish trend line with resistance near 1.3800 on the hourly chart of GBP/USD.
• GBP/JPY topped near 152.65 and started a downside correction.
• There is a short-term bullish trend line forming with support near 152.00 on the hourly chart.

GBP/USD Technical Analysis

This past week, the British Pound saw a drop below the 1.3820 level against the US Dollar. The GBP/USD pair even broke the 1.3800 and 1.3750 support levels.

It traded as low as 1.3727 on FXOpen before it started a fresh increase. There was a steady increase above the 1.3750 resistance level. The price surpassed the 1.3800 resistance level and the 50 hourly simple moving average.

GBP/USD Hourly Chart

There was also a break above a major bearish trend line with resistance near 1.3800 on the hourly chart of GBP/USD. The pair even climbed above 1.3850 and retested the 1.3880 resistance.

A high is formed near 1.3888 and the pair is now correcting gains. It traded below the 23.6% Fib retracement level of the recent wave from the 1.3727 low to 1.3887 high. An immediate support is near the 1.3825 level and the 50 hourly simple moving average.

The next major support is near the 1.3810 level. The 50% Fib retracement level of the recent wave from the 1.3727 low to 1.3887 high is also near 1.3807. If there is a break below the 1.3800 support, the pair could test the 1.3278 support.

If there are additional losses, the pair could decline towards the 1.3720 level. On the upside, the pair is facing a major resistance near the 1.3880 and 1.3900 levels. A clear break above the 1.3900 resistance could increase the chances of a move towards the 1.4000 resistance.

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Dax Index Adds 10 New Companies Ahead of the German Federal Elections

September 2021 will remain in history as the month when the German Dax index undergoes the biggest reform in its existence. Starting with September 20th, ten new companies will be added to the Dax index, and so the number of its constituents increases from 30 to 40.

One of the reasons cited for the change in the Dax is the need to add new companies that reflect the new economy. Truth be said, the Dax had underperformed its peers for some time now. For example, the S&P 500 index outperformed the German Dax index, and so did other indices in the United States.

The ten companies to be added to the Dax index are “promoted” from the MDAX. MDAX is an index tracking middle-sized businesses in Germany, and by adding the new companies, the number of constituents in the Dax increases, while the one in the MDAX decreases.

Puma, Zalando, or Airbus, are some of the names known by the general public that will be added to the Dax. Some other ones, not so popular, are equally important – Symrise, Sartorius, Qiagen.

Will the changes make the Dax index more attractive to investors? It remains to be seen.

Euro Traders Prepare for the German Federal Elections

The federal elections in the United States are scheduled on September 26th, and the market participants are aware that this is the main event in the Euro area for the rest of the year. The importance of it cannot be understated – Angela Merkel, the German Chancellor, will not be candidate, as she ends a long-lasting political career.

With only two weeks until the elections, the SPD, or the socialists, are rising in polls. Olaf Scholz, their leader, is now viewed as the one with the biggest chances to win the German Chancellor position. If the socialists do win, it will mark a change in the German leadership, and the markets embrace for changes in the fiscal space too.

All in all, an interesting September lies ahead for traders monitoring events in Germany. Because the German economy is the largest in the Eurozone, what happens in Germany will affect the common currency, the euro.

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EUR/USD and EUR/JPY: Euro Remains At Risk

EUR/USD started another decline below 1.1820. EUR/JPY is also declining and it broke the 129.80 support zone.

Important Takeaways for EUR/USD and EUR/JPY

• The Euro failed to clear the 1.1880 resistance and started a fresh decline.
• There is a key bearish trend line forming with resistance near 1.1820 on the hourly chart.
• EUR/JPY also started a fresh decline from well above the 130.00 level.
• There was a break below a declining channel with support near 129.50 on the hourly chart.

EUR/USD Technical Analysis

The Euro started a major decline after it struggled to clear the 1.1880 resistance against the US Dollar. The EUR/USD pair broke the 1.1820 support zone to move into a bearish zone.

The pair even traded below the 1.1800 support and settled below the 50 hourly simple moving average. A low was formed near 1.1769 on FXOpen and the pair is now correcting losses. There was a break above the 1.1800 level.

The pair even spiked above the 1.1820 resistance level and a key bearish trend line with current resistance near 1.1820 on the hourly chart.

However, the bulls failed to remain in action above 1.1835. A high was formed near 1.1845 and the pair declined once again. It traded below the 50% Fib retracement level of the upward move from the 1.1769 swing low to 1.1845 high.

It is now consolidating near the 1.1800 level and the 50 hourly simple moving average. An immediate resistance is near the 1.1820 level. The main resistance is still forming near the 1.1840 and 1.1850 levels. A clear break above the 1.1850 resistance could push EUR/USD towards 1.1900.

On the downside, the 1.1800 level is a major support. Any more losses might lead EUR/USD towards the 1.1750 support zone in the near term. The next major support sits near the 1.1720 level.

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Gold Price Nosedives While Crude Oil Price Extends Rally

Gold price started a major decline and traded below the $1,785 support. Crude oil price is rising and it is broke the $72.00 resistance zone.

Important Takeaways for Gold and Oil

• Gold price started a major decline from the $1,800 resistance zone against the US Dollar.
• There was a break below a short-term bullish trend line with support near $1,793 on the hourly chart of gold.
• Crude oil price started a fresh increase from the $70.00 support zone.
• There is a major bullish trend line forming with support near $72.00 on the hourly chart of XTI/USD.

Gold Price Technical Analysis

Gold price failed to stay above the $1,800 support zone against the US Dollar. As a result, the price started a fresh decline below the $1,800 and $1,790 levels.

The price gained pace after it broke the $1,785 support and the 50 hourly simple moving average. There was also a break below a short-term bullish trend line with support near $1,793 on the hourly chart of gold.

Gold Price Hourly Chart

The price declined below the $1,750 level and traded as low as $1,745 on FXOpen. It is now correcting higher and trading above $1,750.

An immediate resistance is near the $1,760 level. It is near the 23.6% Fib retracement level of the recent decline from the $1,808 high to $1,745 swing low. The first major resistance is near the $1,775 level.

The main resistance is near the $1,785 level and the 50 hourly simple moving average. A close above the $1,785 levels could open the doors for a steady increase towards $1,800. The next major resistance sits near the $1,810 level.

Conversely, the price might resume its decline below the $1,750 level. The first major support is near the $1,745 level. A downside break below the $1,745 support zone may possibly spark a sharp decline. In the stated case, the price could test the $1,720 support.

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GBP/USD Remains At Risk, USD/CAD Gains Momentum

GBP/USD started a fresh decline below the 1.3850 support. USD/CAD rallied and it was able to clear the 1.2750 resistance zone.

Important Takeaways for GBP/USD and USD/CAD

• The British Pound started a major decline below the 1.3850 and 1.3800 support levels.
• There is a key bearish trend line forming with resistance near 1.3770 on the hourly chart of GBP/USD.
• USD/CAD started a major increase after it cleared the 1.2700 and 1.2720 levels.
• There was a break above a contracting triangle with resistance near 1.2680 on the hourly chart.

GBP/USD Technical Analysis

After struggling to clear the 1.3900 resistance, the British Pound started a major decline against the US Dollar. The GBP/USD pair broke the 1.3850 support level to move into a bearish zone.

The bears gained strength and were able to push the pair below the 1.3800 support. The pair even broke the 1.3750 support zone and the 50 hourly simple moving average. Finally, it spiked below 1.3720 and traded as low as 1.3701 on FXOpen.

GBP/USD Hourly Chart

It is now consolidating losses near the 1.3700 zone. An immediate resistance is near the 1.3725 level. It is near the 23.6% Fib retracement level of the recent drop from the 1.3812 high to 1.3701 low.

The first major resistance is near the 1.3755 level. It is close to the 50% Fib retracement level of the recent drop from the 1.3812 high to 1.3701 low. There is also a key bearish trend line forming with resistance near 1.3770 on the hourly chart of GBP/USD.

If there is an upside break above the trend line, the pair could recover above 1.3780. The next key resistance could be 1.3800 and the 50 hourly simple moving average, above which the pair could gain strength.

On the downside, the first key support is near the 1.3700 area. If there is a break below 1.3700, the pair could decline extend its decline. The next key support is near the 1.3640 level. Any more losses might call for a test of the 1.3600 support.

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US Dollar Flexing Muscles Ahead Of The Fed’s Decision

The US dollar ended the previous week with a bang, rising to new heights and outpacing its main peers. The new trading week saw a continuation of this march of triumph.

Meanwhile, investors are preparing for what may prove to be the Fed meeting of the year. On Wednesday, the Federal Reserve is expected to announce the tapering of its asset purchases, a move already communicated to markets via its forward guidance model.

Yet, even with this information in mind, it is quite hard to predict the market’s reaction. One of the things that bring uncertainty is the dot plot.

Fed members are required to project the federal funds rate for the years ahead. The sum of their forecast is displayed on a chart in the form of dots. The number of rate hikes and, more importantly, their timing is what affects the way the financial markets move. Should the Fed members reveal an unexpected hawkish outlook, the dollar may grow even stronger.

Risk-Off Sentiment Dominates

Ahead of the Fed’s meeting and outcome announcement, a risk-off sentiment seems to be dominating the markets. Evergrande, a Chinese property developer, is on the verge of collapsing, and the government has no intention to bail the company out. The big question for financial market participants is: Will the collapse of Evergrande have an impact on the international financial system, or will it end up being a local event?

In any case, part of the US dollar’s strength rides on the back of lower equities in the States. Moreover, futures markets are showing renewed weakness at the start of the trading week, so the dollar's growth prospects are good.

All in all, this trading week will be packed with political events (i.e., Canadian and German federal elections) and central banks’ decisions (i.e., Federal Reserve, Bank of Japan, Bank of England, Swiss National Bank, etc.). In other words, volatility is guaranteed to reach new record levels.

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Natural Gas Prices Soar To New Heights. What Is Driving the Climb?

One of the sharpest rallies in 2021 is taking place in the commodities market. Natural gas, seen below as XNGUSD, has doubled in price since late May, and the bullish run may continue into the winter season as it is about to start in the Northern Hemisphere.

Before discussing some of the reasons why natural gas has entered an uptrend, let’s look at the technical state of things. Below is the daily timeframe of the XNGUSD pair which tracks the price of natural gas in US dollars.

The bullish run started in 2020 as the market made a double bottom within the $1.50 area. By the end of 2020, the price action stalled, and consolidation began. A contracting triangle finally acted as a continuation pattern, and the bullish breakout that followed led to the sharp rally mentioned above.

Why Is Natural Gas Rallying?

Different countries charge different prices for natural gas, but now, the prices have one thing in common: they are rising all over the world. In Europe, for example, the natural gas price jumped to record levels, driven by factors such as Russian supply bottlenecks or lack of wind in the UK.

The trend is likely to continue because natural gas is used for electricity generation, plus winter is coming soon. Additionally, Russia announced recently that it wouldn’t increase gas supply to Europe, so the pressure on higher prices remains.

Let’s not forget that rising demand from Asian economies drives the price higher as well. As the post-COVID-19 economic recovery continues, the higher demand will result in more bottlenecks and shortages.

In the UK, the situation is dire, too. The country uses 40% natural gas to meet its energy demands. This week, the UK natural gas wholesale price settled at the highest-ever closing level. If we transform the price of natural gas expressed in mBtu (i.e., million British thermal units) into oil equivalent, we get $150 per barrel of oil.

All in all, while the rally in the natural gas price is nothing short of impressive, we may see more of the same in the months to come. As winter reaches the Northern Hemisphere, the pressure on natural gas prices remains elevated.

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EUR/USD Faces Hurdles, USD/CHF Could Extend Decline

EUR/USD started a fresh decline below the 1.1800 support zone. USD/CHF is declining and it might continue lower below the 0.9220 zone.

Important Takeaways for EUR/USD and USD/CHF

• The Euro started a fresh decline below the 1.1800 and 1.1750 support levels against the US Dollar.
• There is a major bearish trend line forming with resistance near 1.1735 on the hourly chart of EUR/USD.
• USD/CHF failed to clear 0.9335 and started a fresh downward move.
• There was a break below a key bullish trend line with support near 0.9290 on the hourly chart.

EUR/USD Technical Analysis

The Euro struggled to continue higher above the 1.1840 resistance zone against the US Dollar. As a result, the EUR/USD pair started a fresh decline below the 1.1800 support zone.

The pair traded below the 1.1750 support level and settled above the 50 hourly simple moving average. There was also a break below the 1.1720 level. A low was formed near 1.1700 on FXOpen before the pair started an upside correction.

The pair recovered above the 1.1720 level, but it failed near 1.1750. A high is formed near 1.1748 and the pair is now moving lower.

There was a break below the 50% Fib retracement level of the upward move from the 1.1701 swing low to 1.1748 high. It is now consolidating near the 1.1720 level and the 50 hourly simple moving average. An immediate support is near the 1.1718 level.

It is near the 61.8% Fib retracement level of the upward move from the 1.1701 swing low to 1.1748 high. The next major support is near the 1.1700 level. A downside break below the 1.1700 support could start another decline.

On the upside, an initial resistance is near the 1.1735 level. There is also a major bearish trend line forming with resistance near 1.1735 on the hourly chart of EUR/USD.

The main resistance is near 1.1750. If there is an upside break above the 1.1750 resistance zone, the price could rise steadily towards the 1.1800 resistance zone.

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AUD/USD and NZD/USD Could Eye More Upsides

AUD/USD started a fresh increase above the 0.7260 resistance zone. NZD/USD also climbed higher and it might continue to rise towards the 0.7150 level.

Important Takeaways for AUD/USD and NZD/USD

• The Aussie Dollar started a decent increase above the 0.7260 barrier against the US Dollar.
• There was a break above a major bearish trend line with resistance near 0.7260 on the hourly chart of AUD/USD.
• NZD/USD also gained pace after it broke the 0.7020 resistance.
• There was a break above a key bearish trend line with resistance near 0.7020 on the hourly chart of NZD/USD.

AUD/USD Technical Analysis

After a steady decline, the Aussie Dollar found support near the 0.7225 zone against the US Dollar. The AUD/USD pair formed a base above the 0.7220 level and recently started a fresh increase.

The pair broke the 0.7250 and 0.7260 resistance levels. There was also a break above a major bearish trend line with resistance near 0.7260 on the hourly chart of AUD/USD. The pair even cleared the 0.7300 level and the 50 hourly simple moving average.

AUD/USD Hourly Chart

A high was formed near 0.7316 on FXOpen and the pair is now consolidating gains. It is trading near the 23.6% Fib retracement level of the recent increase from the 0.7223 swing low to 0.7316 high.

An initial support on the downside is near the 0.7285 level. The next major support is near the 0.7370 level and the 50 hourly simple moving average. It is close to the 50% Fib retracement level of the recent increase from the 0.7223 swing low to 0.7316 high.

If there is a downside break below the 0.7370 support, the pair could extend its decline towards the 0.7325 level.

An immediate resistance is near the 0.7315 level. The next major resistance is near the 0.7320 level. A close above the 0.7320 level could start a steady increase in the near term. The next major resistance could be 0.7365.

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GBP/USD Remains At Risk, EUR/GBP Could Extend Gains

GBP/USD is trading in a bearish zone below the 1.3750 resistance zone. EUR/GBP is rising and it could gain pace if it clears the 0.8600 resistance.

Important Takeaways for GBP/USD and EUR/GBP

• The British Pound declined below the 1.3800 and 1.3765 support levels.
• There is a key contracting triangle forming with resistance near 1.3685 on the hourly chart of GBP/USD.
• EUR/GBP started a decent increase and cleared the 0.8550 pivot level.
• There was a break above a major bearish trend line with resistance near 0.8565 on the hourly chart.

GBP/USD Technical Analysis

The British Pound started a major decline from well above 1.3800 against the US Dollar. The GBP/USD pair traded below the 1.3720 and 1.3700 support levels to enter a bearish zone.

The pair even broke the 1.3650 support and settled below the 50 hourly simple moving average. It traded as low as 1.3609 and recently started an upside correction. The pair climbed above the 1.3700 resistance, but the bears were active near 1.3750.

A high was formed near 1.3750 before the pair started a downside correction. There was a break below the 1.3700 support level. It traded below the 50% Fib retracement level of the upward move from the 1.3609 swing low to 1.3750 high.

It is now consolidating near the 1.3665 support level. It is close to the 61.8% Fib retracement level of the upward move from the 1.3609 swing low to 1.3750 high. There is also a key contracting triangle forming with resistance near 1.3685 on the hourly chart of GBP/USD.

If there is an upside break above the triangle resistance, the price could surpass 1.3720. The main resistance is near the 1.3750 zone. Therefore, a proper break above the 1.3750 resistance could open the doors for a steady increase. The next major resistance for the bulls could be 1.3800.

If not, the pair could break the 1.3665 and 1.3660 support levels to continue lower. The first key support is near the 1.3620 level. Any more losses could lead the pair towards the 1.3550 support zone.

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Oil’s Rally Continues Ahead of the OPEC’s World Oil Outlook Release

The rally of oil prices continues and is getting threateningly close to reaching a new high for the year. With just a day left before OPEC releases its World Oil Outlook, the WTI crude oil price trades with a bid tone, up over 1% at the start of the trading week.

The WTI crude oil price has grown over 85% in the last year, moving in a steady, bullish trend. It corrected over the summer months, but found strong support at the $60 level.

Goldman Sachs Remains Bullish

The price of oil was driven higher by strong demand following the coronavirus lockdowns and OPEC’s swift reaction to the pandemic. As we get closer to the end of the year, Goldman Sachs remains bullish on the price of oil. More precisely, Goldman sees Brent oil at $90/barrel at the end of the year, and it also lifted its price targets for 2022 and 2023.

Oil is a commodity, and, as such, its price is affected by the imbalances between supply and demand. For now, demand is strong as economic recovery from the pandemic slump continues. Because OPEC has cut production below the demand level, the oil prices recovered from the negative territory in April 2020 all the way to $77, the 2021 high for the WTI crude oil.

The Vienna talks are seen as the biggest risk for the price of oil. Iran is ready to come back to the negotiations table after the local elections ended, and the markets expect them to be successful. If the Iranian oil hits the market, the price of oil will have to reflect the extra 2 million barrels or so per day. But the negotiations are yet to start… and they usually take a lot of time.

Therefore, the bias remains bullish for the price of oil for the end of the trading year. If the market manages to make a new higher high above $77, more upside is likely to come.

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BTCUSD and XRPUSD Technical Analysis – 28th SEPT, 2021

BTCUSD: Grinding above $40K Support

Bitcoin is currently struggling to keep itself above the $40k support and the price is oscillating between the Fibonacci levels of $41472 and 100-day moving average of $42834. It remains in accumulation mode in the London trading session. BTC bullish sentiment was seen at the opening of this week when it touched a high of $44304. Long-term outlook for bitcoin appears bullish and the short-term decline currently reinforces a mild bearish trend formation.

• The relative strength index (14-day) and ultimate oscillator are both indicating a SELL at the current market levels of $41745.
• A short-term correction below $40000 is expected before the continuation of the bullish trend.
• Simple and exponential moving averages indicate a strong SELL.
• Average true range (14-day) indicates high volatility.

Bitcoin Short-Term Bearish Formations

Bitcoin saw a mixed start this week and there is no sign of a bullish momentum. The 100 day moving average is indicating a strong SELL.

The immediate targets would be breaching the classic support levels at $41243 and further moving towards the next major support located at $35819.

Bitcoin is witnessing increased volatility after China banned all crypto transactions during the previous weekly closing on Friday. The support that is holding this week could be broken and bitcoin could start a further decline this week pushing below the psychological support level of $40000.

In the last 24hrs, BTCUSD has dropped by -4.76% (+2087$) and has a 24hr trading volume of USD 31.47 billion.

Bitcoin Sell-Off Continues

Bitcoin is facing selling pressure after the China ban and the trading volumes are high at the Asian exchanges today.

Also, many crypto currency exchanges are closing their Chinese accounts, leading to a withdrawal of funds in the US dollars and putting a selling pressure on BTCUSD.

Technical Indicators:

Relative strength index (14-day):  at 32.442 with a SELL

Ultimate oscillator: at 40.38 with a SELL

Moving averages convergence divergence (12,26): at -370.10 with a SELL

Price of rate change ROC: at -2.31 indicating a SELL

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EUR/USD Could Recover, USD/JPY Extends Rally

EUR/USD extended its decline and traded close to 1.1665. USD/JPY is rising and it might continue to rise above the 111.70 level.

Important Takeaways for EUR/USD and USD/JPY

• The Euro started a major decline below the 1.1750 and 1.1720 support levels.
• There is a key bearish trend line forming with resistance near 1.1690 on the hourly chart of EUR/USD.
• USD/JPY started a fresh increase and it cleared the 111.00 resistance zone.
• There is a crucial bullish trend line forming with support near 111.40 on the hourly chart.

EUR/USD Technical Analysis

This week, the Euro started another decline below the 1.1750 support against the US Dollar. The EUR/USD pair traded below the 1.1720 support to move into a bearish zone.

The pair even broke the 1.1700 level and settled below the 50 hourly simple moving average. A low is formed near 1.1667 on FXOpen and the pair is now consolidating losses. An immediate resistance is near the 1.1688 level.

EUR/USD Hourly Chart

The 23.6% Fib retracement level of the recent decline from the 1.1749 swing high to 1.1667 low is also near the 1.1688 level. The first key resistance is near the 1.1690 level and the 50 hourly simple moving average.

There is also a key bearish trend line forming with resistance near 1.1690 on the hourly chart of EUR/USD. The next major resistance could be 1.1710. It is near the 50% Fib retracement level of the recent decline from the 1.1749 swing high to 1.1667 low.

A close above 1.1720 could open the doors for a steady increase towards 1.1750. Any more gains may possibly lead the pair towards the 1.1800 level.

If there is no break above 1.1690, the pair might continue to move down. An immediate support is near the 1.1665. The next major support is near 1.1650, below which the pair could drop towards the 1.1600 support in the near term.

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ETHUSD and LTCUSD - Technical Analysis – 30th SEPT, 2021

ETHUSD: Ether Rebounding Towards $3000

Ethereum failed to clear the $3200 mark after opening this week on a bullish tone and has since then seen correction touching a low of $2781.58. ETH is now moving above the 100 hourly moving average and would need to cross the major resistance located at $3511.

• Ethereum is gaining traction above $2800 today.
• A correction is expected towards $2955 before the continuation of the bullish trend.
• Staying above both the 100 hourly simple and exponential moving averages.
• The pair is expected to cross $3500 in the opening of the next week.

Ether Dips Well Supported

Ethereum is now on its path towards $3500 after clearing the 20-day moving average of 2913.76 The volatility in Ethereum is low, which is expected to continue next week.

ETH has gained 1.89% with a price change of +$55.32 in the past 24hrs, and has a trading volume of 17.985 billion USD.

The Week Ahead

Ethereum is rebounding after falling towards $2800 as the investors are buying the dips. The movements in Ethereum correlate to the US stocks as the Federal Reserve has hinted it will start hiking interest rates in the coming year.

The rebound was strong and the 50-day moving average, also indicating a BUY.

This week, ETHUSD is expected to close at above the $3200 level, and the trend will continue in the opening of the next week.

In the next week, Ether is expected to cross its resistance located at $3300. Any rally in the crypto markets could steer it above the $3550 level.

Technical Indicators:

Moving averages convergence divergence (12,26): at 37.67, indicating a BUY.

100 hourly moving average: at 2955.89, indicating a BUY.

Ultimate oscillator: at 52.42, indicating a BUY.

Relative strength index (14 days): at 57.79, indicating a BUY.

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Gold Price and Crude Oil Price Remain Supported

Gold price started a fresh increase from the $1,720 support. Crude oil price rallied and it even broke the $75.00 resistance before correcting lower.

Important Takeaways for Gold and Oil

• Gold price started a decent increase above the $1,735 resistance against the US Dollar.
• There was a break above a major bearish trend line with resistance near $1,737 on the hourly chart of gold.
• Crude oil price started a fresh rally from the $70.00 support zone.
• There was a break below a key bullish trend line with support near $74.85 on the hourly chart of XTI/USD.

Gold Price Technical Analysis

Gold price extended its decline below $1,740 against the US Dollar. However, it found support near the $1,720 zone. A low was formed near $1,721 on FXOpen and the price started a fresh increase.

It was able to clear the $1,735 resistance and the 50 hourly simple moving average. There was a break above a major bearish trend line with resistance near $1,737 on the hourly chart of gold.

Gold Price Hourly Chart

The price even broke the 50% Fib retracement level of the key decline from the $1,787 swing high to $1,721 swing low. It is now consolidating gains near the $1,750 level. The first major resistance is near the $1,762 level.

The 61.8% Fib retracement level of the key decline from the $1,787 swing high to $1,721 swing low is also near $1,762. The main resistance is near the $1,780 level. A close above the $1,780 levels could open the doors for a steady increase towards $1,800.

The next major resistance sits near the $1,820 level. On the downside, an initial support is near the $1,745 level. The first major support is near the $1,735 level. A downside break below the $1,735 support zone may possibly spark a sharp decline. In the stated case, the price could test the $1,720 support.

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GBP/USD Faces Hurdle While GBP/JPY Eyes Recovery

GBP/USD extended its decline below the 1.3500 support zone before correcting higher. GBP/JPY is rising and it could gain pace if it clears the 150.60 level.

Important Takeaways for GBP/USD and GBP/JPY

• The British Pound traded as low as 1.3411 before it started a fresh increase against the US Dollar.
• There was a break above a key bearish trend line with resistance near 1.3455 on the hourly chart of GBP/USD.
• GBP/JPY found support near 149.20 and started a decent increase.
• There is a major bearish trend line forming with resistance near 150.60 on the hourly chart.

GBP/USD Technical Analysis

This past week, the British Pound saw a drop below the 1.3650 support level against the US Dollar. The GBP/USD pair even broke the 1.3600 and 1.3500 support levels.

It traded as low as 1.3411 on FXOpen before it started a fresh increase. There was a steady increase above the 1.3450 resistance level. The price surpassed the 1.3500 resistance level and the 50 hourly simple moving average.

GBP/USD Hourly Chart

There was also a break above a key bearish trend line with resistance near 1.3455 on the hourly chart of GBP/USD. Besides, the pair surpassed the 38.2% Fib retracement level of the key decline from the 1.3717 swing high to 1.3411 low.

The pair even climbed above 1.3550 and retested the 1.3560 resistance levels. However, the pair is now facing resistance near the 1.3575 level. It is also struggling near the 50% Fib retracement level of the key decline from the 1.3717 swing high to 1.3411 low.

A close above the 1.3575 level could open the doors for more gains. The next major hurdle is near 1.3620, above which the pair could surge towards 1.3750. An immediate support is near the 1.3525 level.

The next major support is near the 1.3480 level and the 50 hourly simple moving average. If there is a break below the 1.3480 support, the pair could test the 1.3420 support. If there are additional losses, the pair could decline towards the 1.3350 level.

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Investors Expect US Dollar’s Safety Despite Rising Inflation

A new trading month has started pretty much on the same note as the previous one: rising inflation and a stronger US dollar. Last Friday, inflation in the Eurozone and the United States exceeded expectations.

In Germany, for example, it is above 4%, and the last time the annual inflation was as high, the interest rates were higher still. In the US, the Core PCE inflation rose by +0.3% in the previous month. This is the Fed’s favorite way of measuring inflation because it does not consider energy and food prices.

Speaking of energy prices, they are going through the roof. Last week, some interesting milestones were reached. First, Brent crude oil has reached $80/barrel, a 3-year high. Second, Asian coal has reached $203 a tonne, also a record. Natural gas in Europe and Asia hit a record high as well, $34/mBtu.

Although energy prices are not included in the Core PCE calculation, Core PCE is still on the rise, which is evident from Friday’s data. If we judge by the M2 (i.e., money supply)’s correlation to inflation, as shown by the chart below, then inflation is just about to explode.

Why Is US Dollar Getting Stronger Despite Rising Inflation?

One of the questions that many traders and investors are asking is, why is the US dollar getting stronger in a rising inflation environment? Indeed, the US dollar gained against its peers in 2021. Take the EUR/USD exchange rate: it started the year above 1.23 and closed last Friday around 1.16 – a decline of over seven big figures (i.e., seven hundred pips).

There are a few reasons for this. First, USD’s status as the world's reserve currency has not changed during the pandemic despite the US Federal Reserve printing more money than ever.

Second, the Fed prepares to remove some of the monetary accommodation. Most likely, the Fed will announce the start of the tapering of its asset purchases program in November, and the actual reduction in bond-buying in December. Thus, there will be no more bond-buying from the Fed by the middle of next year, as quantitative easing will have officially ended.

In doing so, the Fed is way ahead of other central banks. And it responds to – you guessed it – rising inflation.

Rising inflation prompts central banks to tighten the monetary policy. The quicker the response, the easier it would be to contain the rise in the prices of goods and services. Judging by how far the prices went, it could be that the Fed and other central banks in the world are behind the curve with their monetary policy measures.

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BTCUSD and XRPUSD Technical Analysis – 05th OCT, 2021

BTCUSD: Rising Uptrend Channel Above $48k

Bitcoin is gaining traders sentiment and inching towards $50k in the London trading session. BTC is moving in a rising uptrend channel formation currently trading above its 100 hourly moving averages of $47914. The medium to long term outlook for bitcoin remains bullish with immediate targets for today at $52900.

Relative strength index (14-day) and ultimate oscillator are both indicating a BUY at the current market levels of $49488.

• A bullish momentum is seen above the levels of 47801. The price is expected to remain above these levels.
• BTCUSD is expected to touch an intraday high of $52500 in the US trading session.
• Simple and exponential moving averages indicate a strong BUY.
• Average true range (14-day) indicates less volatility.

Bitcoin Medium-Term Bullish Trend

Bitcoin saw a bullish tone this week and has since continued to rise aiming towards the $50k mark. It is now facing classic resistance levels of $50083 after which the path towards $52000 will get cleared.

In the last 24 hrs BTCUSD has risen by +3.50% to reach +2020$ and has a 24hr trading volume of USD 33.36 billion.

Bitcoin Demand Continues

The year 2021 has been a turnaround year for bitcoin after its widespread adoption and usage. Since the recent ban by China, BTCUSD has gone through a short selling phase. But the recent comments from the Fed Chair Powell indicated that the United States has no plans to follow China or ban crypto. Bitcoin is witnessing a steady increase in prices today in the European trading session.

Bitcoin is witnessing a continuous buying pressure across the major cryptocurrency exchanges worldwide, leading to a continuous surge in prices.

Technical Indicators:

Average direction change (14-day): at 34.157 indicating a BUY

Bull/Bear power (13-day): at 620.67 indicating a BUY

Moving averages convergence divergence (12,26): at 314.80 indicating a BUY

StochRSI (14-day): at 58.88 indicating a BUY

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EUR/USD and EUR/JPY: Euro Eyes Recovery

EUR/USD extended its decline to 1.1565 before correcting higher. EUR/JPY is rising, but it is facing hurdles near 129.50 and 129.75.

Important Takeaways for EUR/USD and EUR/JPY

• The Euro gained bearish momentum below 1.1650 and 1.1600.
• There is a major bearish trend line forming with resistance near 1.1600 on the hourly chart.
• EUR/JPY is attempting a recovery wave above the 129.20 resistance level.
• There is a key bullish trend line forming with support near 129.00 on the hourly chart.

EUR/USD Technical Analysis

The Euro started a major decline after it struggled to clear the 1.1750 resistance against the US Dollar. The EUR/USD pair broke the 1.1650 support zone to move into a bearish zone.

The pair even traded below the 1.1600 support and settled below the 50 hourly simple moving average. A low was formed near 1.1563 on FXOpen and the pair is now correcting losses. There was a break above the 1.1600 level.

EUR/USD Hourly Chart

The pair even spiked above the 1.1620 resistance level, but it faced a strong resistance near the 1.1640 level. A high was formed near 1.1639 and the pair corrected lower.

It traded below the 50% Fib retracement level of the upward move from the 1.1563 swing low to 1.1639 high. There is also a major bearish trend line forming with resistance near 1.1600 on the hourly chart.

It is now consolidating near the 1.1590 level and below the 50 hourly simple moving average. An immediate resistance is near the 1.1600 level. The main resistance is forming near the 1.1640 and 1.1650 levels. A clear break above the 1.1650 resistance could push EUR/USD towards 1.1750.

On the downside, the 1.1665 level is a major support. Any more losses might lead EUR/USD towards the 1.1520 support zone in the near term. The next major support sits near the 1.1500 level.

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