Click video below to watch the latest analysis and do be cautious this week as its a heavy news week.
Chart of the week GBPUSD
This week I have singled out GbpUsd for more downside and have indicated some areas of interest (AOI) on the chart below.
Lets take a look at some of the key factors surrounding the Pound at the moment.
During July, the pound lost ground against major currencies and sank more than 1% below $1.2, approaching its lowest point since the pandemic outbreak in March 2020. Due to investors' growing concerns about a looming recession, sterling's appeal diminished, while uncertainty over the Northern Ireland Protocol and softening expectations about the Bank of England's tightening outlook also hurt the pound. The BoE has raised interest rates five times since December when it became the first major central bank to increase borrowing costs after the COVID-19 pandemic, but traders are scaling back some rate hike bets as recent weak economic data could be an early indication that tightening is slowing the economy. The sterling closed the first half of 2022 down 10%, its worst first-half performance since 2008. - Trading Economics
Energy crisis in Europe has obscured even further the prospects for Eurozone growth, making it more difficult for the ECB to tame record inflation rates. In June of 2022, the Euro Area's annual inflation rate reached a new record high of 8.6%, once again exceeding market expectations. AOI = 1.0500 - 1.4700 EVENTS = ECB MEETING ON THURS FOMC Minutes ON WED Non Farm Payrolls ON FRI
As commodity currencies came under pressure from Fed’s aggressive tightening plans and an escalating global recession risk, the Australian dollar declined past $0.685 on Friday, hitting its lowest levels in two years. It is likely that the RBA will raise interest rates by half a point on Tuesday following a higher-than-expected rise of 50 basis points in June, but I personally think any move from here should be faded.
AOI = 0.687 - 0.685 EVENTS = RBA Interest Rate Decision ON TUES FOMC Minutes ON WED Non Farm Payrolls ON FRI
Recent data has showed 63% of businesses in New Zealand expect economic conditions to deteriorate over the coming year due mainly to supply disruptions and surging cost pressures, highlighting risks to the country’s economic trajectory. This presents a challenge to the Reserve Bank of New Zealand which is expected to stick to its aggressive tightening path to bring down inflation, even if it means risking a recession. AOI = 0.6200 - 0.6213 EVENTS = FOMC Minutes ON WED Non Farm Payrolls ON FRI
Over the last 12 months, Bitcoin fell by 44.59 percent. Looking ahead I'm looking to trade with the momentum and at the moment the momentum is to the downside. Unless we reclaim the ATH from 2017, I see no reason the be bullish.
Over the last 12 months, its price fell by 52.16 percent and momentum is clearly with the bears at the moment. One thing I'm looking for is a break and retest of Inside Bar lows in the search for more downside and eventually the lows around 875.00
Looking back, over the last four weeks, Avalanche lost 30.21%, so Bears are still in control and seem to be on the verge of breaking some support. I remain Bearish on this instrument and any trades I place will reflect that.
Awaiting break of trendline to become interested in this instrument as it is just ranging for now.
As always these are my personal market observations and not trading advice.