Last Week’s Market Wrap
Yesterday the economic calendar was light, starting with the KOF Economic Barometer from Switzerland which showed a decent improvement this month, followed by Spanish consumer inflation CPI (consumer price index). Inflation ticked higher in Spain this month to 5.8%, while the German GDP for Q4 showed a 0.2% contraction in economic activity. Mostly forex majors traded sideways, with a slight bias toward USD bulls in the evening. Crude Oil slipped lower as Chinese and US stocks turned bearish.
This Week’s Market Expectations
Today started with the Chinese manufacturing and services reports, which were expected to show both sectors coming out of contraction this month. The Eurozone flash GDP reading is expected at -0.1%, but the contraction might be larger after seeing yesterday’s German Q4 GDP numbers. Later on, the November GDP figures are expected to show a 0.1% expansion in Canada, while the US CB Consumer Confidence is expected to show a slight improvement this month. The New Zealand unemployment rate is expected to remain unchanged at 3.3% later in the evening.
Yesterday the price action was slow, but was enough for us to pick a few trades. We opened several trading signals in forex, commodities and cryptocurrencies, with only one losing signal. We got caught on the long side in Ethereum as cryptos turned lower, but had several other winning trading signals and our long term sell Oil signal is approaching our take profit target.
Booking Profit on EUR/USD
EUR/USD has been bullish although the pace has slowed this month, with the 200 SMA (purple) acting as support on the H1 chart. The price dipped below this moving average last week but returned back above it and we decided to open a buy signal yesterday which closed in profit as EUR/USD jumped.
EUR/USD – 60 minute chart
Remaining Short on WTI Oil
Crude oil remains bearish on the daily chart, as the USD sentiment still remains bearish. The price retraced higher earlier this month, but the 100 SMA (green)acted as resistance again, rejecting the price. We decided to open long term sell signal up there last week and are more than 3 cents in profit as the bearish trend resumes
WTI Oil – Daily chart
Cryptocurrencies have been bullish throughout January, as they made some decent gains, with major currencies like Ethereum and Bitcoin gaining around 50% in value from the lows, while smaller ones such as Solana and Fanto gained around 250%. But we saw a bearish reversal yesterday, so they didn’t close the month as they performed.
BITCOIN Breaking the 50 SMA
Bitcoin has been bullish and has completed three upward waves, although, these moves have been getting smaller, with the last one taking place over the weekend. The 50 SMA (yellow) has been acting as support on the H4 chart, but it was broken yesterday, so we’ll see if the bullish trend will resume again.
BTC/USD – 240 minute chart
ETHEREUM Slipps Below the 50 SMA
Ethereum has also been showing buying pressure since the beginning of January and we have seen some decent buying momentum which sent the price above $1,600. Moving averages were doing a great job acting as support on the H4 chart and the latest bounce came at the 100 SMA (green) after the retreat. But yesterday we saw a break of that moving average after the retreat following the bounce higher.