Both Bullish and Bearish Markets Face Adjustment

Forex

Central Bank

Summary:

The EURUSD has stabilized after experiencing a decline for six consecutive trading days. The stochastics suggest a potential upward recovery; however, the Relative Strength Index still indicates a bearish trend. The market remains committed to the European Central Bank's (ECB) interest rate cut forecast for October, which poses new downward risks for the euro.

SELL EURUSD

Close Time

CLOSED

1.09666

Entry Price

1.07960

1.10850

1.04249 +0.00643 +0.62%

26.8

Pips

Profit

1.07960

1.09398

Exit Price

1.09666

Entry Price

1.10850

Fundamentals

The EURUSD edged higher during the European session on Tuesday as the U.S. dollar pulled back mildly. However, the short-term outlook for the euro remains fragile, as the majority of ECB officials continue to stress the need for further interest rate cuts. This trend is fueled by a sharp decline in price pressure within the Eurozone and sluggish economic growth.

MARKET WATCH: the euro is at risk of weakening, as the currency market has almost entirely priced in a rate cut from the ECB in October, despite the likelihood of such a cut is less than what the market suggests.

Earlier data releases continue to indicate persistent inflation within the services sector, while rising oil prices may compel the ECB to adjust its inflation expectations upward. However, the market is unlikely to easily abandon bets on an October rate cut, as there remains a significant interest rate differential between the U.S. dollar and euro, putting additional pressure on the EURUSD in the near term.

Both Bullish and Bearish Markets Face Adjustment_1

Technical Analysis

On Tuesday during the European session, due to a slight correction in the U.S. dollar, the EURUSD rebounded, approaching the psychological resistance level around 1.1000. Previously, the EURUSD had significantly declined from the double top near 1.1208, recording six consecutive days of losses and breaching the short-term upward trend line and the 1.1000 level. This indicates a confirmation of an ongoing bearish correction.

A sustained drop below the 1.0920 level would suggest that the decline from 1.1213 marks the third phase of an adjustment pattern that began at 1.1274. In this scenario, a deeper decline could follow, targeting the 61.8% retracement level at 1.0740.

If the price rises back above the significant 1.1000 integer threshold, it could instill some bullish sentiment and a break at the weak resistance level of 1.1039 would first shift the intraday outlook to neutral, followed by the 50-day SMA at 1.1050, and then the resistance level at 1.1070.

Overall, the EURUSD is currently in a declining phase; however, from a broader perspective, the price remains within a bullish zone. It is recommended to focus on the highs and the lows within the range, buying low and selling high.

Trading Recommendations

Trading Direction: Sell

Entry Price: 1.1029

Target Price: 1.0796

Stop Loss: 1.1085

Deadline: October 15, 2024 23:55:00

Support: 1.0950, 1.0920, 1.0898

Resistance: 1.1039, 1.1050, 1.1070

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

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Eva Chen

Central Bank

Commodity

Summary:

Amidst the various ambiguous breakouts, the market is expected to see a pullback as the key neckline is found; it is recommended to go short at the highs using the neckline as a benchmark.

SELL XAGUSD

Close Time

CLOSED

30.579

Entry Price

28.890

33.000

29.524 +0.505 +1.74%

242.1

Pips

Loss

28.890

33.001

Exit Price

30.579

Entry Price

33.000

Fundamentals

The precious metals market continued to retract gains on Tuesday, with investors closely monitoring two inflation reports this week that could solidify the Federal Reserve's policy trajectory for the rest of the year.

Over the past five trading days, gold prices have struggled to achieve further breakthroughs due to various factors, including a strengthening U.S. dollar and soaring U.S. Treasury yields, resulting in sustained downward pressure for consecutive days.

Silver, a sister commodity to gold, did not maintain its upward momentum after testing a 12-year high last week and opened the week below US$32.00.

U.S. Treasury yields rose across the board, with the benchmark 10-year yield surpassing 4.01%, the 2-year yield climbing to 4%, and the 30-year yield increasing to 4.29%. This development is deemed bearish for the metals market, as it raises the opportunity cost of holding non-yielding precious metals.

Despite the recent decline in the U.S. Dollar Index (USDX), it has surged by 2% over the past week. The strengthening of the U.S. dollar simultaneously poses challenges for U.S. dollar-denominated commodities, as it increases the purchasing cost for investors.

In terms of data, inflation will be the predominant factor influencing the market this week. Currently, the market anticipates that the Consumer Price Index for the U.S. in September will slow to 2.3%, with the core inflation rate, which excludes the more volatile energy and food components, expected to remain unchanged at 3.2%. Producer prices are predicted to remain flat, while core producer prices are expected to rise significantly.

These reports may determine whether the Fed will gradually lower interest rates. Following the Fed's substantial 50 basis point rate cut last month, there is a growing expectation that the Fed will adopt a more cautious approach when easing restrictive monetary policies.

Go Short at the Highs Using the Neckline as a Benchmark_1

Technical Analysis

The spot silver price has maintained a strong position since testing a 12-year high of US$32.71 on September 26, and it broke this level again last Friday, signaling a solid prospect for further gains in the market.

In fact, the XAGUSD slightly breached the left shoulder at US$32.28 on September 27 (as seen in the 4H timeframe), providing early indications for continued upward movement. Additionally, last Friday's resurgence, which reached a peak of US$32.95, confirmed this outlook. However, the recent closing price in the 4H timeframe failed to surpass the previous high (the September 26 peak), casting doubt on the sustainability of the subsequent rise. This also demonstrates that the high of US$32.95 from last Friday may reflect speculative sentiment.

With the U.S. dollar strengthening and U.S. Securities yields continuing to rise, amid various ambiguous breakouts, we anticipate that the XAGUSD will likely experience a retreat in the near term. It is recommended to go short at the highs using the neckline as a benchmark. Trend prediction: Neutral.

Trading Recommendations

Trading Direction: Sell

Entry Price: 31.80

Target Price: 28.89

Stop Loss: 33.00

Deadline: October 23, 2024 23:55:00

Support: 30.88, 30.35, 29.71

Resistance: 31.74, 32.28, 32.95

Risk Warnings and Disclaimers

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Adam

Forex

Summary:

On October 8, 2024, the USD/CHF exchange rate was trading around 0.8560 after being pressured at the resistance level of 0.8600. The USD's bullish momentum weakened after a low inflation report from Switzerland, along with a downward correction in the USD after reaching highs last week...

SELL USDCHF

Close Time

CLOSED

0.85600

Entry Price

0.85200

0.86000

0.89276 -0.00488 -0.54%

14.7

Pips

Loss

0.85200

0.85747

Exit Price

0.85600

Entry Price

0.86000

The USD/CHF pair is correcting after hitting highs around 0.8600 earlier in the week. The greenback has been buoyed by positive economic data from the US, including a jobs report that showed a strong labor market, but the correction is taking place after the market reacted to technical resistance levels.

Meanwhile, Switzerland’s consumer price index (CPI) report showed inflation falling to 0.8%, lower than the forecast of 1.1%. This raised expectations that the Swiss National Bank (SNB) could continue to cut interest rates, thereby putting downward pressure on the Swiss franc in the short term. However, in today’s trading session, technical signals showed that the possibility of a short-term correction in USD/CHF still exists.

Market psychology

The overall market sentiment on USD/CHF is currently bearish. With strong resistance at 0.8600 and technical indicators pointing to further downside pressure on the pair, investors are cautious about short-term long positions. Investors are also watching for a correction in the USD, especially as the Swiss inflation report raises expectations for further SNB action.

Technical analysis

USD/CHF is currently trading near the upper band of the Bollinger Bands, indicating that the market is in a bearish correction. The important support zone is at 0.8520, and if the price breaks this level, USD/CHF could continue to decline further. USD/CHF is moving within the Ichimoku cloud, a sign of a tug-of-war between buyers and sellers. However, if the price fails to break the resistance level of 0.8600, the downtrend could continue. The RSI indicator is at 53.31, indicating that the market is not currently in an overbought or oversold state. However, if the RSI continues to decline, it will further reinforce the downtrend of USD/CHF in the coming trading sessions.

Trading Recommendations

Based on technical analysis and market trends, a short-term sell strategy for USD/CHF is recommended:

Entry: 0.8560 (current price).

Take Profit: 0.8520 (nearest support) or further at 0.8480 if the downtrend continues.

Stop Loss: 0.8600 (important resistance level).

Risk Warnings and Disclaimers

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Adam

Forex

Summary:

On October 8, 2024, the AUD/USD exchange rate is trading at 0.6736, showing a strong downward trend of the AUD amid the USD's appreciation thanks to positive economic data from the US...

SELL AUDUSD

Close Time

CLOSED

0.67360

Entry Price

0.67000

0.67500

0.62483 +0.00129 +0.21%

14.0

Pips

Loss

0.67000

0.67500

Exit Price

0.67360

Entry Price

0.67500

The AUD/USD pair has been under pressure in recent sessions as the USD continues to dominate the forex market. A better-than-expected US jobs report, coupled with a stabilizing US economy, has boosted the USD. At the same time, the Australian economic outlook has been weighed down by poor trade data, which has weakened the AUD. Export reports and a contraction in the manufacturing sector have disappointed, sending the AUD/USD sharply lower.

In addition, the Reserve Bank of Australia (RBA) monetary policy outlook is nothing new, with forecasts that the RBA may maintain steady policy or even cut interest rates in the near future. This has reduced the attractiveness of the AUD in the eyes of investors, while the USD is still receiving support from the tightening policy of the US Federal Reserve (Fed).

Market psychology

Investor sentiment is turning negative for AUD/USD, as investors seek the USD as a safe haven amid global economic uncertainty. The AUD has been pressured by concerns about a slowdown in the Australian economy and lack of strong growth momentum in the near term. In addition, the prospect that the Fed may continue to maintain or even raise interest rates has put great pressure on commodity currencies like the AUD, with investors gradually turning to the USD to protect their assets.

Technical analysis

AUD/USD: Xu Hướng Giảm và Chiến Lược Bán_1

AUD/USD is currently trading near the lower band of the Bollinger Bands, a sign that bearish pressure remains present. The nearest resistance is at 0.6744, and if it fails to break this level, AUD/USD could continue to correct lower towards the support level of 0.6700 or lower.

According to the Ichimoku indicator, the AUD/USD exchange rate is trading below the Ichimoku cloud, which indicates that the strong downtrend is still dominant. If the exchange rate fails to break above the resistance zone above the cloud, the price is likely to continue to fall further in the following trading sessions.

The CCI indicator is currently in the slightly overbought zone at 91.67, which suggests a possible downside correction in the near term. If the CCI starts to turn lower, this will be a strong sell signal for AUD/USD in the short term.

Trading Recommendations

Given the current technical factors and market context, a short-term sell strategy for AUD/USD is recommended as the downtrend is still dominant:

Entry: 0.6736 (current price).

Take Profit: 0.6700 (nearest support zone) or further at 0.6680 if the decline continues.

Stop Loss: 0.6750 (if price breaks the nearest resistance level).

Risk Warnings and Disclaimers

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Warren Takunda

Traders' Opinions

Economic

Summary:

The GBP/JPY pair remains in a bullish trend, supported by persistent UK inflation and expectations of further tightening by the Bank of England.

BUY GBPJPY

Close Time

CLOSED

194.201

Entry Price

198.000

192.000

196.400 -0.357 -0.18%

84.8

Pips

Profit

192.000

195.049

Exit Price

194.201

Entry Price

198.000

The British pound continues to exert upward pressure on the Japanese yen, keeping the GBP/JPY pair in a bullish trajectory. This strength is largely attributed to the UK’s ongoing battle with inflation, which has compelled the Bank of England (BoE) to maintain its hawkish stance on monetary policy. The central bank has already implemented multiple rate hikes this year, and while the market is pricing in some level of caution, further tightening may be on the horizon. As inflation remains sticky, hovering well above the BoE's target, investors are increasingly speculating on the possibility of additional interest rate hikes in the near future.

The Bank of England’s role in sustaining this bullish sentiment is critical. With inflation showing no signs of abating, any shift in policy that points toward more restrictive measures could further support the pound. This possibility makes the GBP an attractive currency relative to the yen, which is weighed down by the Bank of Japan's ultra-loose monetary policy. While the BoJ has hinted at possible future adjustments, its dovish stance, combined with Japan’s low inflation environment, continues to pressure the yen.

Technical Analysis

From a technical perspective, the GBP/JPY faced a brief bout of negative pressure in recent trading sessions, dipping to a low of 193.05. This move triggered a temporary retracement within the minor bullish channel, but key support at 192.75 has held firm, offering a strong foundation for a continued upward push. The stochastic oscillator, which recently exited oversold territory, adds credence to the bullish outlook, signaling that the downside risk may be limited and the path of least resistance is upward.

This bullish scenario remains intact as long as the pair holds above the 192.75 support level. A bounce from this area could propel GBP/JPY toward the next immediate resistance at 194.80, with further gains likely to target the 198.00 level. These positive stations represent critical thresholds that, once cleared, could open the door to higher highs in the coming days or weeks.

Conversely, a break below the 192.75 support line would indicate a potential shift in momentum. Should the pair close below this level, it would signal a bearish reversal, targeting 191.80 and possibly even 191.45, forcing the pair to endure a deeper correction.

For today’s trading session, the expected range is between 193.00 and 194.80, and the overall trend forecast remains bullish as long as key support holds.

TRADE RECOMMENDATION

BUY GBPJPY

ENTRY PRICE: 194.200

STOP LOSS: 192.00

TAKE PROFIT: 198.00

Risk Warnings and Disclaimers

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Alan

Central Bank

Forex

Summary:

The U.S. non-farm payrolls have shown strong performance, providing a short-term boost to the U.S. dollar; however, the underlying depreciation trend of the U.S. dollar remains unchanged. Meanwhile, the Chinese yuan continues to strengthen due to favorable policies from the People's Bank of China (PBOC)), leading to a bearish outlook for the USDCNH.

SELL USDCNH

Close Time

CLOSED

7.05346

Entry Price

6.98200

7.10500

7.29121 -0.01636 -0.22%

515.4

Pips

Loss

6.98200

7.10501

Exit Price

7.05346

Entry Price

7.10500

Fundamentals

As of October 8, during the European trading session, the USDCNH traded around 7.060, marking a decline of 0.20% for the day.

On the news front, on October 4, the U.S. released non-farm payrolls indicating an increase of 254,000 jobs in September, significantly surpassing the expected 150,000. The unemployment rate in the U.S. also came in lower than anticipated, leading traders to generally abandon their bets on a 50 basis point rate cut by the Federal Reserve in November. The robust employment figures suggest a degree of resilience in the U.S. economy, enhancing the likelihood of a "soft landing." As a result, the dollar experienced support, with the U.S. Dollar Index (USDX) surpassing the 102 threshold and the USDCNH accelerating to 7.1037.

Despite the robust employment data from the U.S. in September, it has not altered the underlying scenario of significant debt and severe inflation in the U.S. The possibility of the Fed continuing to cut interest rates remains, which may only provide a temporary boost to the U.S. dollar. This is evident in recent market performance; following a sharp increase in the USDCNH last Friday, it began to decline on Monday and has continued to fall today. This indicates a market sentiment leaning towards the depreciation of the U.S. dollar, increasing the likelihood of a decline in the USDCNH.

Furthermore, the Chinese yuan has been bolstered by the PBOC's proactive growth-stabilizing policies on September 24, which have uplifted market sentiment and provided stronger support for the Chinese yuan's exchange rate. In the near future, as these growth-stabilizing measures persist, there is potential for improved economic growth momentum in the fourth quarter, allowing the Chinese yuan to maintain its recent strength.

In summary, the U.S. dollar has not escaped the cycle of depreciation; rather, the Chinese yuan has been consistently gaining strength under the favorable policies of the PBOC, heightening the likelihood of a decline in the USDCNH.

Technical Analysis

Go Short at the Highs with Range-bound Fluctuation in the Middle Term_1

In the 1W timeframe, the USDCNH formed a long bullish candle last week, indicating that bearish sentiment for the USDCNH remains weak as it approaches the critical support level of 6.9700, with insufficient downward momentum.

In the 1D timeframe, the USDCNH has been on a downward trend from July to September. After falling to the key support level of 6.9700 on September 26, it started a technical rebound, rising to the significant resistance level of 7.100, aided by favorable U.S. non-farm payrolls, before experiencing a subsequent decline.

Examining the candlestick structure, the USDCNH's highs and lows are progressively declining, suggesting increasing upward pressure on the price. The short-term trend appears bearish with a likelihood of testing the critical support at 6.9700 once again. If this support level is effectively breached, it would open up further downside potential for the USDCNH.

Overall, the price movement of USDCNH is likely to fluctuate within a range of 6.9700 to 7.100.

It is recommended to go short at the highs in the short term.

Trading Recommendations

Trading Direction: Sell

Entry Price: 7.0600

Target Price: 6.9820

Stop Loss: 7.1050

Deadline: October 22, 2024 15:00:00

Support: 7.0455, 7.0310, 7.0000

Resistance: 7.0838, 7.1032, 7.1129

Risk Warnings and Disclaimers

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Alan

Central Bank

Forex

Summary:

Strong U.S. September non-farm payrolls data boosted the U.S. dollar and increased downward pressure on the AUDUSD.

SELL AUDUSD

EXP

EXPIRED

0.67820

Entry Price

0.66600

0.68550

0.62483 +0.00129 +0.21%

Pips

EXPIRED

0.66600

0.66837

Exit Price

0.67820

Entry Price

0.68550

Fundamentals

As of today during the European trading session, the AUDUSD has experienced a consecutive decline for four trading days, currently facing significant downward pressure.

On the U.S. side: Last Friday, the non-farm payrolls for September exceeded expectations, highlighting the resilience of the U.S. labor market. The robust non-farm payrolls diminished market expectations for a substantial interest rate cut by the Federal Reserve in November, prompting adjustments to the Fed's future monetary policy outlook. This has enhanced the appeal of the U.S. dollar.

In comparison, the strength of the U.S. dollar has weakened the attractiveness of the Australian dollar, as investors are more inclined to hold currencies with a relatively favorable interest rate outlook; under these circumstances, the AUDUSD is under notable downward pressure.

On the Australia side: The borrowing costs in Australia remain elevated in the context of combating inflation. Currently, the Reserve Bank of Australia (RBA) is in a wait-and-see stance regarding interest rate decisions, requiring further confirmation that inflation will return to the target range before taking any subsequent action. This results in a relatively small divergence in interest rate policy between Australia and the U.S., which has, to some extent, influenced the exchange rate of the AUDUSD.

Overall, due to the strengthening of the U.S. dollar prompted by robust non-farm payrolls, the Fed may slow its pace of interest rate cuts. Consequently, the support the Australian dollar had from interest rate differentials is gradually being undermined, leading to a less optimistic short-term outlook. However, if the global risk sentiment improves or if there are shifts in Fed policy, the Australian dollar may experience a rebound.

Technical Analysis

Robust Non-farm Payrolls Push Up the U.S. Dollar with Short-term Bearish Outlook_1

In the 1M timeframe, the AUDUSD is currently in a consolidation phase at the lows. Although there was strong upward momentum in August and September, it remains hindered by the critical resistance level of 0.6950, leading to a subsequent downturn. Additionally, the recent release of robust U.S. non-farm payrolls has intensified upward pressure on the AUDUSD, suggesting it may continue to consolidate at lower levels.

In the 1D timeframe, the AUDUSD has breached the short-term upward trend line, indicating signs of a potential downward shift and showcasing strong bearish momentum in the near term.

In terms of technical indicators, the AUDUSD is beginning to fall below the middle band of the Bollinger Bands. The MACD line has crossed below the signal line, giving birth to a death cross, while the Relative Strength Index (RSI) has turned downward from the overbought zone, indicating a tendency for the AUDUSD to decline in the short term.

Currently, if the AUDUSD effectively breaks below the key support level of 0.6650, and makes new lows, bears will likely open further downward channels, continuing to test the lower end of the consolidation range at the 0.6280 level. If the downward momentum halts above 0.6650, it may stabilize.

It is recommended to go short at the highs.

Trading Recommendations

Trading Direction: Sell

Entry Price: 0.6782

Target Price: 0.6660

Stop Loss: 0.6855

Deadline: October 22, 2024 15:00:00

Support: 0.6720, 0.6675, 0.6621

Resistance: 0.6760, 0.6782, 0.6817

Risk Warnings and Disclaimers

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Both Bullish and Bearish Markets Face Adjustment

Fundamentals

Technical Analysis

Trading Recommendations

Go Short at the Highs Using the Neckline as a Benchmark

Fundamentals

Technical Analysis

Trading Recommendations

USD/CHF is correcting after hitting highs around 0.8600

Market psychology

Technical analysis

Trading Recommendations

AUD/USD: Downtrend and Selling Strategy

Market psychology

Technical analysis

Trading Recommendations

GBP/JPY: Bullish Momentum Prevails Amid Persistent Inflationary Pressures

Go Short at the Highs with Range-bound Fluctuation in the Middle Term

Fundamentals

Technical Analysis

Trading Recommendations

Robust Non-farm Payrolls Push Up the U.S. Dollar with Short-term Bearish Outlook

Fundamentals

Technical Analysis

Trading Recommendations

Risk Disclosure