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Inflation

GOLD RALLYAfter the death cross was confirmed earlier this week, to test critical support near $ 1,805 with a 200-day moving average (DMA) and 50 DMA match, it lasted below the January 19 low of $ 1,810. A break is needed. This level also brings a wedge support line. The US Federal Reserve (Fed) matched extensive marketplace forecasts even as maintaining the benchmark hobby costs and tapering goals intact. However, the exciting element from the Monetary Policy Statement was, “The Committee expects it's going to quickly be suitable to elevate the goal variety for the federal budget rate. The US Treasury yield plummeted 1.85% over a 10-year period and was offered slightly after recording the largest daily rise in three weeks. However, US and European stock futures have fallen by more than 1.0% during the day at a press conference. Gold prices can quickly continue to fall as technical failures add to the root cause. However, today's US fourth-quarter GDP and December durable goods orders are important for the short-term direction.
FXOPEN:XAUUSD
by FiscalAutonomy
AUD/USD AnalysisThe AUD/USD has resumed its decline in Asia, despite surprised by the sharp rise in inflation data. “Underlying inflation accelerated to 1% quarter-on-quarter and 2.6% year-on-year in the fourth quarter. Quarterly trimmed inflation was at its highest level since the third quarter of 2008, with annual figures For the first time since mid-2014, we are above the center of the Reserve Bank of Australia's target range, ". "RBA will almost certainly need to adjust forward guidance to admit that rate hikes are possible this year. RBAs are likely to want wage growth to accelerate significantly. Therefore, it seems that the main argument is not to shift to a rate hike in 2022. However, it is possible to prove this faster than expected. " The AUD / USD has returned to the well-known conflict level around 0.7160, which has played both support and resistance roles since last September. Beyond this area, the 100-day simple moving average (SMA), which is the level at which the bulls struggled earlier this month, will be tested. Alternatively, 23.6% Fibonacci retracement seems likely to be the level of support after the daytime descent could not break Fibonacci.
by FiscalAutonomy
USDCAD sellers attack 1.2450 key support ahead of Canadian CPIAlthough USDCAD buyers keep lurking around an upward sloping trend line from June, failures to stay decisively above the 200-DMA keep sellers hopeful of breaking the 1.2450 support. Adding to the bearish bias are the downbeat MACD and RSI conditions. That said, 61.8% Fibonacci retracement (Fibo.) of June-December 2021 advances, near 1.2370, is likely next support to watch on a clear break of 1.2450. It’s most likely that the RSI will turn oversold at the crucial Fibo. level and trigger a corrective pullback, if not then October’s low of 1.2287 will be on bear’s radar. Alternatively, a disappointment by the monthly Canadian CPI could trigger a much-awaited rebound of the Loonie pair, which will need validation from Friday’s peak of 1.2570. Following that, a convergence of the 100-DMA and a monthly resistance line, around 1.2620, will be crucial for the USDCAD bulls to watch. Should the pair buyers manage to cross the 1.2620 hurdle, the odds of witnessing a run-up towards the monthly high of 1.2813 can’t be ruled.
Short
by MTradingGlobal
EURUSD rebound needs to stay beyond 1.1385 to convince bullsEURUSD extends the run-up beyond 200-SMA to cross a two-month-old horizontal area surrounding 1.1385 post-US inflation data. Given the price-positive signals from the MACD and RSI, the major currency pair is likely to keep the recent rebound. However, a sustained run-up beyond 1.1385 becomes necessary for the pair buyers to challenge the mid-November peak near 1.1465. Following that, the 1.1500 threshold will offer an intermediate halt during an upward trajectory towards early November’s swing highs around 1.1600. Meanwhile, failure to stay beyond 1.1385 could trigger a pullback move targeting the 200-SMA level near 1.1310. It should be noted, however, that the EURUSD weakness past 1.1300 will be challenged by an upward sloping support line from late November, around 1.1265. Also acting as a downside filter is the year 2021 bottom close to 1.1185. In a case where the major currency pair drops below 1.1185, March 2020 high near 1.1150 and 61.8% FE of November 09-30 moves, around 1.1120, will gain the market’s attention. To sum up, EURUSD crossed a strong hurdle to the north after the US Consumer Price Index (CPI) data but bulls seek confirmation from 1.1385.
by MTradingGlobal
2
Gold buyers tighten grips ahead of US inflation dataGold keeps the bounce off 23.6% Fibonacci retracement of November-December fall to cross the 100-SMA surrounding $1,805, backed by firmer RSI and higher-low formation. As MACD is also shifting in favor of the bulls, the metal prices are likely heading towards 61.8% Fibo. level near $1,830. However, a two-month-old horizontal resistance and tops marked during the July-September period, around $1,834, will be tough challenges for the gold bulls to cross before convincing markets. Hence, a short-term upward trajectory is brewing ahead of the key data. Meanwhile, a downside break of the weekly support line, around $1,795 at the latest, will trigger a fresh round of gold-selling towards the recent swing low of $1,787. Though, any further weakness will be challenged by multiple supports marked since early November close to $1,760. If at all the gold bears keep reins past $1,760, December’s bottom of $1,751 will act as the last hope for buyers before throwing dice for sellers targeting September’s low surrounding $1,721.
OANDA:XAUUSD
by MTradingGlobal
NZDUSD braces for a bull-run ahead of next week’s RBNZFirmer RBNZ Inflation Expectations for Q4 propels NZDUSD towards confirming falling wedge bullish formation, extending run-up towards the 200-SMA level of 0.7070 by the press time of early Thursday. It should be noted, though, that the 38.2% Fibonacci retracement (Fibo.) of September-October upside, near 0.7085, adds to the upside filter and may probe the bulls before directing them to the monthly peak surrounding 0.7200. In doing so, the RBNZ’s rate hike will be crucial to watch. Meanwhile, failures to keep the wedge breakout could drag the quote back to 61.8% Fibo. level near the 0.7000 threshold. Following that, a six-week-old horizontal support zone near 0.6980 and the wedge’s support line close to 0.6970 will test the NZDUSD bears before directing them to 78.6% Fibonacci retracement level and September’s bottom, respectively near 0.6930 and 0.6860. To sum up, NZDUSD flag bullish bias before the key RBNZ interest rate decision.
Long
by MTradingGlobal
EURUSD pulls back from 200-SMA ahead of US inflation dataEURUSD defies a three-day recovery ahead of the key US Consumer Price Index (CPI) data on early Wednesday. The major currency pair’s weakness could also be linked to the failures to cross the 200-SMA, bearish MACD signals and RSI retreat. Hence, the quote is likely to decline further towards monthly horizontal support near 1.1525-32. However, the yearly low around 1.1510 and 61.8% Fibonacci Expansion (FE) of the September 14 to October 28 moves, near 1.1490, also joined by the March 2020 bottom, could challenge the pair bears afterward. Meanwhile, recovery moves will be challenged by a convergence of the 200-SMA and 23.6% Fibonacci retracement of September-October fall, around 1.1610. Following that, a downward sloping resistance line from September 03, around 1.1645 and late October’s swing high around 1.1695 will lure the EURUSD bulls. Should the pair buyers manage to cross the 1.1700 hurdle, backed by softer US inflation numbers, the quote may not hesitate to challenge the 61.8% Fibonacci retracement level of 1.1760.
by MTradingGlobal
Key SMA confluence probes gold buyers below $1,800Gold prints four-day uptrend, tracking monthly support line amid early Friday. However, a convergence of the 100 and 200-DMAs near $1,795 offers a tough nut to crack for the bulls. Should the quote rise past $1,795, the mid-September peak near $1,809 may offer an intermediate halt during the run-up targeting the $1,834 crucial resistance, marked twice in 2021. It’s worth noting that the latest inflation chatters underpin the US Treasury yields and may recall the US dollar bulls should today’s PMIs for October arrive as strong, which in turn could pull the gold prices back from a strong resistance level. On the contrary, a downside break of the stated support line, around $1,778 by the press time, may need validation from $1,770 and June’s low near $1,750 to convince gold sellers. Following that, 23.6% Fibonacci retracement of June-August fall, near $1,733, could probe the fall targeting the $1,700 threshold and the yearly bottom surrounding $1,668. Overall, gold remains in the consolidation mode and needs confirmation for further upside.
OANDA:XAUUSD
by MTradingGlobal
EURUSD eyes 1.1790 break to keep controls on US inflation dayEURUSD struggles to keep rebound from monthly low ahead of the key US Consumer Price Index (CPI) data for August. Given the latest chatters over Fed tapering before the next week’s FOMC, today’s US inflation data becomes crucial for the markets. Ahead of the data, the US dollar slips and prints mild gains on the face of the EURUSD. However, failures to cross the 1.1910 horizontal resistance and sluggish oscillators keep sellers hopeful. It should be noted, though, that the 50-DMA and 20-DMA, respectively around 1.1795 and 1.1790, restrict the quote’s short-term downside ahead of July’s low near 1.1790. If US inflation data rejects tapering concerns with a downbeat figure, the EURUSD prices may recover from the key moving averages. With this, the latest swing high around 1.1850 may offer an intermediate halt before highlighting the 1.1910 horizontal area, comprising multiple tops marked since June 30. In a case where the EURUSD bulls manage to keep reins past 1.1910, odds of its rally towards May’s bottom near 1.1985 and the 1.2000 psychological magnet should return to the charts.
Short
by MTradingGlobal
The NIFTY will crash in August 2021 . The reasons: why the nifty will crash ( Auguest 2021 )? 1. The weakening of USD against INR, The weaker USD will result in stronger INR which will directly result in the Indian stock market becoming " Expensive " to the FII . These FII have taken huge sums of money from Federal Reserve, USA. As the interest rates are the lowest they have been but the recent reports published by Pew Research and Federal Reserve indicate that the USA Inflation has reached 4%, The highest it has even been in the past 13 years. They'll have to increase the interest rates to lower the inflation otherwise the Debt Bonds the US issues to its DII and FII will become worthless and thus, crashing the US financial Institutions. 2. When the rupees become stronger than USD, due to the USD becoming weaker in the international, It becomes expensive for the FII to invest money in the Indian stock markets and causes a mass sell-off of stocks, bonds, debt, and many other financial instruments. BUY NIFTY AUGUST PUTS. SELL NIFTY AUGUST CALLS.
NSE:NIFTYShort
by jaideeppandeji
2
Gold stays pressured below $1900 as traders await ECB, US CPIGold prices remain on the back foot amid anxious hours of early Thursday as markets wait for the ECB and the US Consumer Price Index (CPI) data. Although the ECB is less likely to become a major catalyst, the anticipated optimism of the bloc’s policymakers could offer intermediate bounce to gold prices. However, a stronger-than-expected beat of the US inflation data won’t be taken lightly and can drag the yellow metal on release. It should, however, be noted that ascending support line from mid-May and late April, respectively around $1,879 and $1,871, could probe sellers whereas 200-SMA near $1,848 and May 10 top close to $1,845 adds to the downside filters. Meanwhile, an upside clearance of the monthly resistance line, close to $1,900, will aim for the recent high of $1,917. In a case where the gold buyers keep reins past $1,917, October 2020 levels near $1,933 should offer an intermediate halt during the rally targeting the yearly peak of $1,960. To sum up, today is a test for the gold buyers who seemed to have tired of late.
OANDA:XAUUSDShort
by MTradingGlobal
New Zealand dollar soars on RBNZThe New Zealand dollar has recorded sharp gains on Wednesday. In the European session, NZD/USD is trading at 0.7303, up 1.02% on the day. As was widely expected, the Reserve Bank of New Zealand maintained its policy settings and kept the Official Cash Rate (OCR) at 0.25%. The RBNZ also upgraded its economic forecasts for 2o21. This was not a surprise, given the economy's strong recovery. However, the rate statement was more hawkish than the market had expected, in particular the forward guidance as to a potential rate hike. The central bank's OCR projection suggested that we could see a rate hike as early as the fourth quarter of 2022. Ahead of the policy meeting, the well-respected Westpac Group said that they did not expect a rise in rates prior to 2024. The potential of a rate hike occurring much earlier than expected has sent the New Zealand dollar sharply higher. Will the RBNZ be able to deliver on a rate hike late next year? That will depend on the strength of the economy, in particular, the inflation and employment situation. It is a hazardous game to predict rate hikes, as we saw Westpac forced to wipe egg off its face after its forecast for a rate hike was way off the mark. It's been a banner week for the kiwi, which has racked gains of 1.8 per cent. The US dollar continues to stumble and is broadly weaker against the majors. We could still see further movement this week, as the US releases key data. The highlight is US Preliminary GDP for the first quarter, which will be released on Thursday. The initial estimate came in at 6.4%, and the consensus for the second estimate has been upwardly revised to 6.5%. This will be followed on Friday by the Core PCE Price Index, which is the Federal Reserve's preferred inflation gauge. The index is expected to rise to 0.6% in April, up from 0.4%. With higher inflation still a concern, a higher reading than the consensus could boost the US dollar. NZD/USD is testing resistance at 0.7239, which has held since February 26. Above, there is resistance at 0.7314. There is support at 0.7120 and 0.7076 .
by OANDA
New Zealand dollar continues to gain groundThe New Zealand dollar continues to head higher this week. In the North American session, NZD/USD is trading at 0.7244, up 0.37% on the day. It has been a strong start to the week for the New Zealand dollar, which is up 0.95%. The US dollar is once again struggling against the major currencies. Inflation surged in April, which led to speculation that the Fed might contemplate scaling back QE. This gave the US dollar a brief boost earlier in May, but the market appears to have accepted the Fed line that higher inflation is transitory and any tightening of policy is a while off. The Federal Reserve continues to send out a consistent, clear message to the market that its ultra-accommodative policy will continue and that will maintain current QE levels. With a tighter policy unlikely in the short term, the US dollar has become less attractive to investors. The Reserve Bank of New Zealand holds its policy meeting on Wednesday. New Zealand data has been strong, but there are concerns of reflation as the economy heats up. The central bank is expected to sound dovish, with no changes forecast in policy. Still, given the strength of the economic recovery, investors will be looking for any hints of potential tapering to QE, which would be bullish for the New Zealand dollar. Westpac expects the RBNZ to upwardly revise its economic forecasts for 2021. It also is projecting that inflation will easily surpass 2 per cent this year, but adds that the RBNZ has anticipated this and will view higher inflation as transitory. We have seen this script with the Federal Reserve, which has dismissed a recent surge in inflation as merely temporary. Finally, Westpac does not expect the central bank to hike rates before 2024. NZD/USD is testing resistance at 0.7239. Above, there is resistance at 0.7314. There is support at 0.7120 and 0.7076 .
by OANDA
PART 1/2 Connecting the dots: QE, MMT and inflation Inflation is a tough one to get your head around, and QE, MMT and fiscal spending is popular terms these days. I will try to connect the dots short and sharp in two posts. I’ll use gold as an inflation metric, i.e. higher gold price equals higher inflation. First, "inflation is always and everywhere a monetary phenomenon", Milton Friedman once said. There are many inflation terms (e.g. cost pull and demand pull), but in terms of Friedman, real inflation must come from a rise in money. Where do money come from? The only entity that can print US dollars is the US government, but do US dollars have to come from the government? During the great inflation, government spending was low, but the effective Federal funds rate went from 3% to almost 20% in order to deal with the inflation. If government spending was low, and interest rates (IR) was high, how could the money be flooding the streets? The answer is the private banking system. QE are bank reserves the private banks CAN use in order to make new loans (US dollars). I write can in capital letters, because that’s the important point. If the private banks don’t use the banks reserves to make new loans, every single dollar of bank reserves printed by the Federal Reserve never enter the real economy, and, hence, can’t be inflationary. Bottom line: QE can be inflationary but is NOT as long as the private banks don’t want to take on more risk and make new loans (US dollars). If the private banks can’t make the US dollars needed, MMT is a popular solution these days. MMT brings the money creation from the private banks back to the US government. If MMT is a good or a bad idea is not the purpose of this post, but put simple, this is what you need to know: MMT is a response to the private banks not making sufficient US dollars the global economy (USD = world reserve currency) needs in order to grow. Summary: QE is potentially inflationary but it’s not as long as the private banks don’t use the bank reserves to make US dollars. MMT is the response to the insufficient flows of US dollars from the private banking system.
FRED:FYFSD
by eirikb007
BTCUSD long term analysis on the weekly time frameBTCUSD has been supported perfectly on the weekly 200MA as I discussed in my previous post in 2019 The 200MA has proved to be a perfect entry on the corona dump. As one can see, the downward sloping trendline resistance has been broken. Also the 10000-10500 area which was proving to be a major resistance zone has been flipped as support which confirms the bull run For buying one can consider taking position on the retest of the weekly 21EMA. The bigger parabolic moves and price discovery are highly likely to be seen in 2021
BITSTAMP:BTCUSDLong
by shaumitagarwal
GOLDGOLD had a sharp sell off like equities in the 1st week of March due to Central Banks across the globe pumping liquidity and reducing rates. Besides the domino principle of one pulling the other (losses in equities globally being cleared via unwinding of long gold positions) as one asset manages the other in a systematic risk environment. Current set up suggest $1675 where it would complete its minimum Bullish Dragon (trigger - hourly close above $1630). Only if it sustains above that $1800 is the next level with some resistance near $1735. Else a dip till $1575 before it attempts another up move. From a medium to long term prospective this could be the last leg of the rally from 2016, post this Gold could start a fresh downside cycle.
OANDA:XAUUSDEducation
by Dinesh_C_Nagpal
1
Trump on Twitter, undervalued euro and important dataTraditionally, financial markets could not relax mainly because of one person. It is all about US President Donald Trump. Yesterday, he said that if the head of Sino, Xi Jinping, does not meet with him at the G-20 summit, the United States will impose additional tariffs on Chinese goods. So, as we warned, you should not relax and calm down. Accordingly, buying gold and Japanese yen, especially at current prices, seems to us one of the best trading ideas today. Well, about Trump, we cannot but pay attention to the next wave of verbal interventions on his part. This time, he said that "The Euro and other currencies are devalued against the dollar, putting the U.S. at a big disadvantage." Not that everyone rushed to buy euros after that, but Trump definitely sowed seeds of doubt. Immediately, a whole series of major analysts burst out with forecasts in favor of euro growth. In particular, Deutsche Bank noted that the euro is undervalued by 7 against the dollar and should cost 1.20. And according to the Organization for Economic Cooperation and Development model, the euro is generally undervalued by 22% (!). Yesterday, unexpectedly, quite good data on the UK labor market appeared. Employment in April rose by 32K (with the forecast +4K), and the average salary showed growth above analysts' expectation 3.1% (with a forecast 3.0%). We have been waiting for much weaker statistics. Nevertheless, we consider the pound growth as an opportunity for its sales. Well, there are no reasons for the pound optimism. Brexit pauses until the new Prime Minister will be chosen this will happen no earlier than July. And it is not a fact that it will be a positive sign for the pound. So, you can re-open trade a little bit later in case of os stop-loss execution. The main event of the day will be the inflation statistics publication from the United States. The output of data below forecasts or below 2% (the Feds target ), would be a pretty strong signal in favor of dollar sales. Recall, in a week the Fed’s decision on the parameters of monetary policy in the United States will be announced and it is very likely that the rate will be lowered this month. Perhaps even by 0.5%. Today's data will have an impact on it. Our trading preferences for today are as follows: we will continue to look for points for the sales of the US dollar against the Japanese yen, as well as the euro, sales of oil and the Russian ruble, as well as buying of gold and sales of GBPUSD.
Long
by Trade24Fx
3