The daily reports for important events that affects the forex, stocks and commodities markets.

16/11/2022 Daily Reports

Support Level: 1.0270 - 1.0200 - 1.0100 Resistance Level: 1.0480 - 1.0600- 1.0700

EUR/USD

  • The EURUSD is climbing in the North American session, though it remains beneath the highs of the day at 1.0481, reached on the release of a softer-than-expected Producer Price Index (PPI) for the United States. At the time of writing, the EURUSD is trading at 1.0360,  still bullish in the daily chart.
  • Global equities continue to rally, between 0.70% and 2.10%. The US Department of Labor (DoL) reported that PPI for October rose by 8% YoY, below 8.3%, while excluding volatile items, the so-called core PPI jumped by 6.7% YoY, less than 7.1% foreseen. Now that CPI and the PPI reports are in the rearview mirror, suggesting that US inflation is cooling, Federal Reserve (Fed) policymakers are lying the ground to decrease the size of rate hikes from 75 bps to 50.
  • Meanwhile, a slew of Fed members crossed newswires led by Lisa Cook, which said that inflation remains too high and that the central bank’s focus will be addressing inflation. The Philadelphia Fed President Patrick Harker said that he’s not “overly worried” about inflation expectations and suggested that the Fed could pause as long as the US central bank stays committed to tame inflation.
  • The EUR/USD pair is trading near the 1.0360, unchanged for the day with bullish stance in daily chart. The pair stabilized above 20 and 50 SMA, indicates bullish strength. Meanwhile, the 20 SMA continued accelerating north and developing above longer ones, suggests bulls not exhausted yet. On upside, the immediate resistance is 1.0480, break above this level will extend the advance to 1.0600.
  • Technical readings in the daily chart support the bullish stances. The RSI indicators hovering above the midlines and stabilized around 68. The Momentum indicator stabilized above the midline, indicating upward potentials. On downside, the immediate support is 1.0270 and below this level will open the gate to 1.0200.

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    Support Level: 1.1650 - 1.1500 - 1.1380 Resistance Level: 1.2030 - 1.2150 - 1.2300

    GBP/USD

    • The Pound Sterling soars sharply against the US Dollar (USD) following the release of prices paid by producers in the United States, showing that inflation is easing. Also, an upbeat UK employment data report underpinned the Cable, as shown by the GBPUSD gaining more than 1.50%. At the time of writing, the GBPUSD is trading at 1.1875, still bullish in the daily chart.
    • The sentiment is upbeat, triggered by two Federal Reserve (Fed) officials saying it would be appropriate to slow the pace of rate hikes following the release of a soft October US Consumer Price Index report. Also, the Producer Price Index (PPI) for the same period expanded by 8% on an annual pace, below the 8.3% estimated, as shown by a US Department of Labor (DoL) survey. The core PPI, which excludes volatile items, rose 6.7% YoY, below the expected 7.1%. Given that US CPI and PPI readings are beginning to flash signs that inflation in the United States is starting to cool down, the Federal Reserve has some reasons to slow down the pace of tightening. Therefore, further US Dollar weakness is expected.
    • Data wise, employment data in the UK showed that the number of people in work in the UK dropped 52K, more than the 25K falls estimated by street economists. At the same time, the Unemployment Rate rose by 3.6%, exceeding the 3.5% expected.
    • The GBP/USD offers bullish stance in daily chart. Cable stabilized above all main SMAs, indicating bullish strength in short term. Meanwhile, the 20 SMA continued accelerating north and developing above longer ones, suggests bulls not exhausted yet. On upside, The immediate resistance is 1.2030 with a break above it exposing to 1.2150.
    • Technical readings in the daily chart support the bullish stances. RSI indicator stabilized around 61, while the Momentum indicator stabilized above the midline, suggesting upward potentials. On downside, the immediate support is 1.1650, unable to defend this level will resume the decline to 1.1500.

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    Support Level: 1732 - 1700- 1680 Resistance Level: 1787 - 1800 - 1810

    XAU/USD

    • Gold prolongs its recent upward trajectory and touches its highest level since mid-August, around the $1,784-$1,785 region on Tuesday. The XAUUSD maintains its bid tone through the early North American session, with bulls now eyeing a move towards reclaiming the $1,800 psychological mark.
    • Following the previous day’s modest bounce, the US Dollar comes under some renewed selling pressure and extends the softer US consumer inflation-inspired downfall. In fact, the USD Index, which measures the greenback’s performance against a basket of currencies, drops to a fresh three-month low and acts as a tailwind for the dollar-denominated gold.
    • The US CPI report released last week indicated that the worst of the post-pandemic price spike is over and fueled speculations for a less aggressive policy tightening by the Federal Reserve. This is evident from the ongoing decline in the US Treasury bond yields, which continues to weigh on the greenback and offers additional support to the non-yielding gold.
    • Gold price stabilized around 1779, up for the day and bullish in the daily chart. The gold price stabilized above 20 and 50 SMA, suggesting bullish strength. Meanwhile, the 20 SMA started turning north and heading towards longer ones, indicating bulls not exhausted yet. On upside, the immediate resistance is 1787, break above this level will open the gate to extend the advance to 1800 area.
    • From a technical perspective, the RSI indicator hold above the midline and stabilized around 71, suggesting bullish strength. The Momentum indicator stabilized above the midline, suggests upward potentials. On downside, the immediate support is 1732, below this area may resume the decline to 1700.

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    Support Level: 137.60 - 136.00 - 134.00 Resistance Level: 140.80 - 142.50 - 145.30

    USD/JPY

    • The USDJPY struggles to gain traction above 140.80 and drops following the release of a soft US inflation report, strengthening the case for the Federal Reserve and moderating the pace of rate hikes. Also, geopolitical tensions arose as reports emerged that two Russian missiles hit Poland. The USDJPY is trading at 139.10, below its opening price by 0.58%.
    • Sentiment remains fragile following the Poland events. Reports emerged that Ukrainian forces intercepted a Russian rocket, which dived into Poland, causing the tragedy. Of note, Polish authorities have not expressed an official version of what happened. At the time of typing, the White House said it couldn’t confirm the reports coming out from Poland.
    • On the Japanese front, data revealed that GDP for Q3 shrank by 1.2% against a 1.1% growth estimated by analysts, justifying the Bank of Japan’s (BoJ) monetary policy. The BoJ  Governor Haruhiki Kuroda continually expressed that the central bank would keep monetary policy conditions loose to stimulate the Japanese economy.
    • The USD/JPY pair stabilized around 139.10, down for the day and bearish in the daily chart. The price still maintains the downward slope and upside got some resistance from 200 SMA, suggests bearish strength in short term. Meanwhile, 20 SMA started turning south and heading towards longer ones, indicating bears not exhausted.  On upside, overcome 140.80 may encourage bulls to challenge 142.50, break above that level will open the gate to 145.30.
    • Technical indicators suggest the bearish strength. RSI stabilized around 32, while the Momentum indicator continued developing below the midline, suggests downward potentials. On downside, the immediate support is 137.60, break below this level will open the gate to 136.00 area.

    Support Level: 33300 - 33160 - 33000 Resistance Level: 34030 - 34300 - 34600

    DJI

    • DJI consolidated in the familiar range, tumbled from 34025 intraday high to 33325 daily low. It trimmed some losses and ended Monday at around 33620, unchanged for the day and neutral to bearish in the hourly chart. The price stabilized below 20 and 50 SMA, suggests bearish strength. Meanwhile, 20 and 50 SMA started turning flat but continued developing above 200 SMA, suggests bulls not exhausted in the long term yet. On upside, overcome 34030 may encourage bulls to challenge 34000, break above this level will open the gate to 34300.
    • Technical indicators suggest the bearish strength. RSI stabilized around 43, while the Momentum indicator stabilized below the midline, suggests downward potentials. On downside, the immediate support is 33300, break below this level will open the gate for more decline to 33160 area.

    Support Level: 91.50 -90.00 - 89.00 Resistance Level: 94.70 - 95.70 - 97.00

    BRENT

    • Brent got some support from 91.50 area and climbed to intraday high 94.53, it hold near the top and ended Monday at around 94.35, up for the day and neutral to bullish in the hourly chart. The price jumped above 20 SMA and now is challenging 50 SMA, suggests bullish strength in short term. Meanwhile, the 20 SMA started turning flat despite it still trades far below longer ones, indicating diminished bearish bias. On upside, overcome 94.60 (50 SMA) may encourage bulls to challenge 95.70 (upside bearish trend line), break above this level will open the gate to 97.00.
    • Technical indicators suggest the bullish movement, hovering above the midline. RSI stabilized at around 60, while the Momentum indicator stabilized above the midline, suggests reward potentials. On downside, the immediate support is 91.50, break below this level will open the gate for more decline to 90.00 area.

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