Price of Gold Fundamental Daily Forecast – Struggling Against Firm US Dollar

Gold futures are trading flat early Tuesday after posting a technical reversal the previous session following a test of its lowest level since August 11. With the trend down, the price action probably reflected short-covering and position-squaring since the bearish traders have to get out of the way before the real buyers can gain control. In other words, gold went up because weak short decided to bailout, not because of the presence of strong buyers.

At 03:13 GMT, December Comex gold traders are trading $1763.90, up $0.10 or +0.01%.

Monday’s short-covering rally was likely fueled by a dip in Treasury yields and some hedge buying tied to the steep sell-off in the global equity markets. The strong U.S. Dollar likely put a lid on the rally.

Gold did not go up because it is a safe-have asset. Gold is an investment, not a safe-haven. That’s old school thinking. The true safe-havens are U.S. Treasurys, the U.S. Dollar and the Japanese Yen. When there’s trouble like potential contagion from the financial turmoil coming out of China, investors want safety and liquidity. To some, gold is a safe-haven, but the liquidity can’t compare to the Treasury and foreign currency markets.

A few weeks ago I read some analysis on FXEmpire.com where a fellow was saying gold would rally during an upcoming stock market crash. On September 2, the benchmark S&P 500 Index hit an all-time high of 4545.85. On September 20, it reached a low of 4305.91. This is a 5.28% loss. On September 3, December Comex gold hit a high of $1836.90. On September 20, it hit a low of $1742.30. This is a 5.15% loss. So if you do the math, gold has outperformed the S&P 500 Index since September 3.

I’m being sarcastic, of course. My point is, the direction of gold is controlled by interest rates and at time the U.S. Dollar. Gold tends to react to stock market crashes when the Federal Reserve floods the financial system with massive amounts of liquidity. I don’t they’re going to do that now just one-day before the start of a two-day meeting where they will be discussing whether to begin pulling liquidity out of the market.

So if gold rallies from current price levels, the move will likely be fueled by short-covering and position-squaring. If the stock market drops another 5 to 10% over a short period of time, the Fed may have to do something, but they don’t have a lot of tools left in their toolbox with interest rates already sitting near zero.

The chances of a powerful gold rally are slim because I don’t think the Fed will lower rates because they can’t and I don’t think they are going to increase their bond purchases to provide more liquidity because they are close to reducing their massive stimulus program. At best, the Fed will leave its bond purchases at current price levels and take a pass on tapering until later in the year when the stock market could be more stable.

Even if gold does pop to the upside, it’s likely to be another shorting opportunity.

For a look at all of today’s economic events, check out our economic calendar.

USD/JPY Fundamental Daily Forecast – More Downside Pressure Likely as Financial Markets Remain Unsettled

The Dollar/Yen is trading higher on Tuesday after posting a sharp sell-off the previous session due the safe-haven buying of the Japanese Yen. The Forex pair is being supported early in today’s session by a technical bounce in global equity markets and slight rise in U.S. Treasury yields. Despite the rebound, traders remain cautious due to contagion fears in the Asia-Pacific region and general uncertainty ahead of the start of the Federal Reserve’s two-day meeting on Tuesday.

At 01:40 GMT, the USD/JPY is trading 109.552, up 0.172 or +0.16%. This is up from Monday’s low at 103.324.

Safe-Haven Buying Drives Demand for Japanese Yen

The USD/JPY retreated on Monday as worries about the fallout from property developer Evergrande’s solvency issues spooked financial markets and lifted safe-haven currencies like the Japanese Yen.

Market sentiment is being rattled by the potential contagion from Evergrande, which is trying to raise funds to pay a host of lenders, suppliers and investors. A deadline for an $83.5 million interest payment on one of its bonds is due on Thursday, and the company has $305 billion in liabilities.

Evergrande’s woes worsened on Monday after warnings from Chinese regulators that the company’s insolvency could fuel broader risks in the country’s financial system if not stabilized.

Fed Meeting on the Radar

Ahead of Monday’s turmoil, the U.S. Dollar had been pushing higher against the Japanese Yen and a basket of other major currencies on expectations the Federal Reserve will begin reducing its monthly bond purchases this year, with the central bank’s policy announcement due on Wednesday.

Daily Forecast

Despite the early strength, the USD/JPY could still face some downside pressure because the financial markets remain unsettled. Some traders are getting their first taste of a classic flight to safety move into the U.S. Dollar and the Japanese Yen until we get some sense of clarity on whether or not Evergrande’s assets will be liquidated in an orderly fashion or just dumped on the open market.

Australia, for example, is facing huge risks because Evergrande is one of the major property owners in the country. Evergrande is expected to be forced to liquidate large amounts of property to fulfil their debt obligations and that will really hurt property and property-related commodities and stocks.

Global debt and equity markets are especially at risk. If they continue to tumble then investors will flock to the Japanese Yen for protection.

For a look at all of today’s economic events, check out our economic calendar.

AUD/USD and NZD/USD Fundamental Daily Forecast – RBA Minutes to Take Backset to Evergrande Contagion Fears

The Australian Dollar is edging higher against the U.S. Dollar early Tuesday, shortly ahead of the release of the Reserve Bank of Australia’s (RBA) policy meeting minutes at 01:30 GMT. The Aussie was under pressure the previous session as a stronger U.S. Dollar weighed down commodities and commodity-linked currencies. The catalyst behind the selling pressure was a looming catastrophe at indebted property giant China Evergrande.

At 0:55 GMT, the AUD/USD is trading .7254, up 0.0001 or +0.02%.

Aussie traders are extremely nervous because Evergrande is one of the major property owners in Australia. A forced liquidation of those properties to fulfil their debt obligations will put tremendous pressure on property and property-related stocks. It could also hurt the mortgage market and may even force the RBA to delay any tightening of policy. New liquidity from the central bank could become an option if the situation gets worse enough. All of these factors could weigh on the Australian Dollar.

RBA Minutes to Provide Little Help if Focus Remains on Threat of Evergrande Contagion

The RBA will on Tuesday release the minutes from its monetary policy meeting on September 7.  At the meeting, the RBA kept its key interest rate unchanged at a record low 0.10 percent and confirmed to taper its bond purchases.

AUD/USD traders seemed to have been slightly caught off guard by the RBA’s decision to taper its bond purchases at the policy meeting.

Although initially the Aussie Dollar jumped, it reversed course soon after. The Aussie spiked about 0.3 percent after the meeting but went on to trade 0.3 percent lower than before the RBA’s meeting.

After the policy announcement, a high-ranking RBA official said he expects the economy to “bounce back” from virus lockdowns as vaccination rates rise and as governments ease health restrictions, giving the central bank confidence to begin dialing back its $200 billion bond-buying stimulus.

RBA Governor Philip Lowe said after the bank’s monthly board meeting on Tuesday the lockdowns in NSW and Victoria would “delay”, but “not derail”, the economic recovery.

Dr. Lowe admitted there was uncertainty about the timing and pace of the bounce-back, and it was likely to be slower than earlier in the year.

“Much will depend on the health situation and the easing of restrictions on activity.”

Daily Forecast

Everything the RBA has to say in its minutes is expected to be downplayed due to the financial ramifications from the widely expected Evergrande property liquidation in Australia and the lingering impact of the move.

No one is certain how this situation will play out so there is no strong incentive to buy the AUD/USD at this time especially before the start of the Federal Reserve’s two-day meeting on Tuesday.

Traders are bracing for contagion and fallout from the Evergrande problem so rallies are likely to be sold until there is more clarity.

For a look at all of today’s economic events, check out our economic calendar.

Dogecoin – Daily Tech Analysis – September 21st, 2021

Dogecoin

Dogecoin slid by 10.43% on Monday. Following a 3.48% loss on Sunday, Dogecoin ended the day at $0.2087.

A mixed start to the day saw Dogecoin rise to an early morning intraday high $0.2335 before hitting reverse.

Falling short of the first major resistance level at $0.2394, Dogecoin slid to a mid-day intraday low $0.1990.

Dogecoin fell through the day’s major support levels before finding support.

Through the early afternoon, Dogecoin broke back through the third major support level at $0.2137 before ending the day at sub-$0.21 levels.

At the time of writing, Dogecoin was down by 2.43% to $0.2037. A mixed start to the day saw Dogecoin rise to an early morning high $0.2087 before falling to a low $0.1988.

Dogecoin left the major support and resistance levels untested early on.

DOGEUSD 210921 Hourly Chart

For the day ahead

Dogecoin would need to move through the $0.2137 pivot to bring the first major resistance level at $0.2285 into play.

Support from the broader market would be needed, however, for Dogecoin to break back through the first major support level to $0.22 levels.

Barring an extended crypto rally, the first major resistance level would likely cap the upside

In the event of a broad-based crypto rally, Dogecoin could test resistance at $0.25 levels before any pullback. The second major resistance level sits at $0.2482.

Failure to move through $0.2137 pivot would bring the first major support level at $0.1940 into play.

Barring another extended sell-off, however, Dogecoin should avoid sub-$0.18 levels. The second major support level sits at $0.1792.

Looking at the Technical Indicators

First Major Support Level: $0.1940

Pivot Level: $0.2137

First Major Resistance Level: $0.2285

23.6% FIB Retracement Level: $0.3016

38.2% FIB Retracement Level: $0.3859

62% FIB Retracement Level: $0.5221

Please let us know what you think in the comments below.

Thanks, Bob

EOS, Stellar’s Lumen, and Tron’s TRX – Daily Analysis – September 21st, 2021

EOS

EOS tumbled by 14.58% on Monday. Following a 10.23% slump on Sunday, EOS ended the day at $4.1976.

A mixed start to the day saw EOS rise to an early morning intraday high $4.9318 before hitting reverse.

Falling short of the first major resistance level at $5.326, EOS slid to a mid-day intraday low $4.0828.

The reversal saw EOS fall through the first major support level at $4.6805 and the second major support level at $4.4471 to end the day at sub-$4.20 levels.

At the time of writing, EOS was down by 4.99% to $3.9881. A mixed start to the day saw EOS rise to an early morning high $4.2037 before falling to a low $3.8415.

EOS tested the first major support level at $3.8763 early on.

EOSUSD 210921 Hourly Chart

For the day ahead

EOS would need to move through the $4.4041 pivot to bring the first major resistance level at $4.7253 into play.

Support from the broader market would be needed to break out from $4.50 levels.

Barring a broad-based crypto rally, the first major resistance and Monday’s high $4.9318 would likely cap any upside.

In the event of an extended rally, EOS could test the second major resistance level at $5.2531 before any pullback.

Failure to move through the $4.4041 pivot would bring the first major support level at $3.8763 back into play.

Barring an extended sell-off, however, EOS should steer clear of sub-$3.50 levels. The second major support level at $3.5551 should limit the downside.

Looking at the Technical Indicators

First Major Support Level: $3.8763

First Major resistance Level: $4.7253

23.6% FIB Retracement Level: $6.52

38% FIB Retracement Level: $9.68

62% FIB Retracement Level: $14.77

Stellar’s Lumen

Stellar’s Lumen slid by 9.98% on Monday. Following a 2.73% fall on Sunday, Stellar’s Lumen ended the day at $0.2822.

A mixed start to the day saw Stellar’s Lumen rise to an early morning intraday high $0.3147 before hitting reverse.

Falling short of the first major resistance level at $0.3162, Stellar’s Lumen fell to a mid-day intraday low $0.2708.

Stellar’s Lumen fell through the day’s major support levels.

Finding late support, Stellar’s Lumen ended the day at $0.28 levels.

Late in the day, the third major support level at $0.2874 pegged Stellar’s Lumen back, however.

At the time of writing, Stellar’s Lumen was down by 3.55% to $0.2722. A mixed start to the day saw Stellar’s Lumen rise to an early morning high $0.2824 before falling to a low $0.2700.

Stellar’s Lumen left the major support and resistance levels untested early on.

XLMUSD 210921 Hourly Chart

For the day ahead

Stellar’s Lumen would need to move through the $0.2892 pivot to bring the first major resistance level at $0.3077 into play.

Support from the broader market would be needed, however, for Stellar’s Lumen to break back through to $0.30 levels.

Barring an extended rally, the first major resistance level would likely cap the upside.

In the event of a broad-based crypto rally, Stellar’s Lumen could test resistance at $0.32 levels. The second major resistance level sits at $0.3331.

Failure to move through the $0.2892 pivot would bring the first major support level at $0.2638 into play.

Barring another extended sell-off on the day, Stellar’s Lumen should steer clear of sub-$0.25 levels. The second major support level sits at $0.2453.

Looking at the Technical Indicators

First Major Support Level: $0.2638

First Major Resistance Level: $0.3077

23.6% FIB Retracement Level: $0.

38% FIB Retracement Level: $0.4277

62% FIB Retracement Level: $0.5690

Tron’s TRX

Tron’s TRX tumbled by 11.50% on Monday. Following a 2.17% loss on Sunday, Tron’s TRX ended the day at $0.09160.

A mixed start to the day saw Tron’s TRX rise to an early morning intraday high $0.1041 before hitting reverse.

Falling short of the first major resistance level at $0.1066, Tron’s TRX fell to a mid-day intraday low $0.08929.

The sell-off saw Tron’s TRX fall through the day’s major support levels.

More significantly, Tron’s TRX also fell through the 38.2% FIB of $0.09890 to end the day at $0.091 levels.

At the time of writing, Tron’s TRX was down by 4.13% to $0.08782. A mixed start to the day saw Tron’s TRX rise to an early morning high $0.09160 before falling to a low $0.08648.

Tron’s TRX left the major support and resistance levels untested early on.

TRXUSD 210921 Hourly Chart

For the Day Ahead

Tron’s TRX would need to move through the $0.09500 pivot to bring the 38.2% FIB of $0.09890 and the first major resistance level at $0.1007 into play.

Support from the broader market would be needed, however, for Tron’s TRX to break back through to $0.10 levels.

Barring an extended crypto rally, the first major resistance level and Monday’s high $0.1041 would likely cap the upside.

In the event of a broad-based crypto rally, Tron’s TRX could test resistance at $0.11 levels before any pullback. The second major resistance level sits at $0.1098.

Failure to move through $0.09500 pivot would bring the first major support level at $0.08589 into play.

Barring an extended sell-off, however, Tron’s TRX should steer clear of the 23.6% FIB of $0.07870. The second major support level at $0.08019 should limit the downside.

Looking at the Technical Indicators

First Major Support Level: $0.08589

First Major Resistance Level: $0.1007

23.6% FIB Retracement Level: $0.0787

38.2% FIB Retracement Level: $0.0989

62% FIB Retracement Level: $0.1316

Please let us know what you think in the comments below

Thanks, Bob

The Crypto Daily – Movers and Shakers – September 21st, 2021

Bitcoin, BTC to USD, slid by 8.93% on Monday. Following a 2.24% decline on Sunday, Bitcoin ended the day at $43,025.0.

A mixed start to the day saw Bitcoin rise to an early morning intraday high $47,327.0 before hitting reverse.

Falling short of the first major resistance level at $48,127, Bitcoin tumbled to a midday intraday low $42,567.0.

Bitcoin fell through the day’s major support levels before briefly revising $44,000 levels.

Coming up against the third major support level at $44,416, however, Bitcoin slid back to end the day at sub-$44,000 levels.

The near-term bullish trend remained intact, in spite of the latest return to $42,000 levels. For the bears, Bitcoin would need a sustained fall through the 62% FIB of $27,237 to form a near-term bearish trend.

The Rest of the Pack

Across the rest of the majors, it was a bearish day on Monday.

Chainlink slumped by 13.82% to lead the way down, with Bitcoin Cash SV (-12.60%) and Ripple’s XRP (-12.16%) close behind.

Things were not much better for Binance Coin (-10.91%), Cardano’s ADA (-8.87%), Crypto.com Coin (-10.28%), Ethereum (-10.58%), Litecoin (-10.55%), and Polkadot (-8.15%).

Early in the week, the crypto total market rose to a Monday high $2,122bn before sliding to a Tuesday low $1,863bn. At the time of writing, the total market cap stood at $1,870bn.

Bitcoin’s dominance fell to a Monday low 41.89% before rising to a Monday high 42.76%. At the time of writing, Bitcoin’s dominance stood at 42.38%.

This Morning

At the time of writing, Bitcoin was down by 2.51% to $41,943.0. A bearish start to the day saw Bitcoin fall from an early morning high $43,028.0 to a low $41,935.0.

Bitcoin left the major support and resistance levels untested early on.

Elsewhere, it was a bearish start to the day.

At the time of writing, Crypto.com Coin was down by 4.89% to lead the way down.

BTCUSD 210921 Hourly Chart

For the Bitcoin Day Ahead

Bitcoin would need to move through the $44,306 pivot to bring the first major resistance level at $46,046 into play.

Support from the broader market would be needed for Bitcoin to break out from $45,000 levels.

Barring a broad-based crypto rally, the first major resistance level and resistance at $47,000 would likely cap the upside.

In the event of a broad-based crypto rebound, Bitcoin could test resistance at $50,000 levels before any pullback. The second major resistance level sits at $49,066.

Failure to move through the $44,306 pivot would bring the 38.2% FIB of $41,592 and the first major support level at $41,286 into play.

Barring another extended sell-off on the day, Bitcoin should steer clear of sub-$40,000 levels. The second major support level sits at $39,546.

Ethereum, Litecoin, and Ripple’s XRP – Daily Tech Analysis – September 21st, 2021

Ethereum

Ethereum slid by 10.58% on Monday. Following a 3.14% loss on Sunday, Ethereum ended the day at $2,976.48.

A mixed start to the day saw Ethereum rise to an early morning intraday high $3,346.58 before hitting reverse.

Falling short of 23.6% FIB of $3,369 and the first major resistance level at $3,431, Ethereum slid to a mid-day intraday low $2,911.81.

Ethereum fell through day’s major support levels to end the day at sub-$3,000 levels.

Through the afternoon, Ethereum had broken back through the third major support level at $2,996 before easing back.

At the time of writing, Ethereum was down by 0.67% to $2,956.40. A mixed start to the day saw Ethereum rise to an early morning high $2,977.52 before falling to a low $2,952.09.

Ethereum left the major support and resistance levels untested early on.

ETHUSD 210921 Hourly Chart

For the day ahead

Ethereum would need to move through the $3,078 pivot to bring the first major resistance level at $3,245 into play.

Support from the broader market would be needed, however, for Ethereum to break back through to $3,200 levels.

Barring an extended crypto rally, the first major resistance level would likely cap the upside.

In the event of a broad-based crypto rally, Ethereum could test resistance at the 23.6% FIB of $3,369 before any pullback. The second major resistance level sits at $3,513.

Failure to move through the $3,078 pivot would bring the first major support level at $2,810 into play.

Barring another extended sell-off, however, Ethereum should steer clear of the second major support level at $2,644.

Looking at the Technical Indicators

First Major Support Level: $2,810

Pivot Level: $3,078

First Major Resistance Level: $3,245

23.6% FIB Retracement Level: $3,369

38.2% FIB Retracement Level: $2,740

62% FIB Retracement Level: $1,725

Litecoin

Litecoin slid by 10.55% on Monday. Following a 3.08% decline on Sunday, Litecoin ended the day at $157.23.

A mixed start to the day saw Litecoin rise to an early morning intraday high $176.13 before hitting reverse.

Falling short of the 23.6% FIB of $178 and the first major resistance level at $181, Litecoin slid to a mid-day intraday low $153.49.

The reversal saw Litecoin fall through the day’s major support levels.

Through the afternoon, Litecoin had broken back through the third major support level at $160 before falling back.

At the time of writing, Litecoin was down by 0.90% to $155.81. A mixed start to the day saw Litecoin rise to an early morning high $157.86 before falling to a low $155.75.

Litecoin left the major support and resistance levels untested early on.

LTCUSD 210921 Hourly Chart

For the day ahead

Litecoin would need to move through the $162 pivot to bring the first major resistance level at $171 into play.

Support from the broader market would be needed, however, for Litecoin to break out from $165 levels.

Barring an extended crypto rally, the first major resistance level would likely cap the upside.

In the event of another breakout, Litecoin could test resistance at the 23.6% FIB of $178 and $180. The second major resistance level sits at $185.

Failure to move through the $162 pivot would bring the first major support level at $148 into play.

Barring another extended sell-off, Litecoin should steer clear of sub-$140. The second major support level at $140 should limit the downside.

Looking at the Technical Indicators

First Major Support Level: $148

Pivot Level: $162

First Major Resistance Level: $171

23.6% FIB Retracement Level: $178

38.2% FIB Retracement Level: $223

62% FIB Retracement Level: $296

Ripple’s XRP

Ripple’s XRP tumbled by 12.16% on Monday. Following a 2.51% fall on Sunday, Ripple’s XRP ended the day at $0.92113.

A mixed start to the day saw Ripple’s XRP rise to an early morning intraday high $1.04991 before hitting reverse.

Falling short of the first major resistance level at $1.0312, Ripple’s XRP slid to a mid-day intraday low $0.87506.

Ripple’s XRP fell through the day’s major support levels.

Steering clear of the 23.6% FIB of $0.8533, however, Ripple’s XRP briefly revisited $0.95 levels before easing back.

At the time of writing, Ripple’s XRP was down by 1.96% to $0.9031. A bearish start to the day saw Ripple’s XRP fall from an early morning high $0.92162 to a low $0.90310.

Ripple’s XRP left the major support and resistance levels untested early on.

XRPUSD 210921 Hourly Chart

For the day ahead

Ripple’s XRP would need to move through the $0.9487 pivot to bring the first major resistance level at $1.0223 into play. Support would be needed, however, for Ripple’s XRP to move back through to $1.00 levels.

Barring an extended crypto rally, the first major resistance level and Monday’s high $1.04991 would likely cap the upside.

In the event of a broad-based crypto rally, Ripple’s XRP could test the second major resistance level at $1.1236. Ripple’s XRP would need plenty of support, however, to breakout from the 38.2% FIB of $1.0659.

Failure to move through $0.9487 pivot would bring the 23.6% FIB of $0.8533 and the first major support level at $0.8475 into play.

Barring another extended sell-off, however, Ripple’s XRP should steer clear of sub-$0.80 levels. The second major support level sits at $0.7739.

Looking at the Technical Indicators

First Major Support Level: $0.8475

Pivot Level: $0.9487

First Major resistance Level: $1.0223

23.6% FIB Retracement Level: $0.8533

38.2% FIB Retracement Level: $1.0659

62% FIB Retracement Level: $1.4096

Please let us know what you think in the comments below.

Thanks, Bob

Another Quiet Day on the Economic Calendar Leaves the FED and Risk Sentiment in the Driving Seat

Earlier in the Day:

It was a relatively quiet start to the day on the economic calendar this morning, with the China markets closed today. The Kiwi Dollar was in action in the early hours, however.

Later this morning, the RBA meeting minutes will also draw interest as the markets look to assess the impact of the latest lockdown measures on policy.

For the Kiwi Dollar

Consumer sentiment figures were in focus.

In the 3rd quarter, the Westpac Consumer Sentiment Index fell from 107.1 to 102.7.

According to the Westpac survey,

  • Confidence took a hit, with the index falling by 4.4 points as a result of the latest nationwide lockdown.
  • The decline was more modest, however, than the fall seen back in 2020.
  • While households remain secure about their personal financial situation, global supply chain disruption weighed on spending appetites.

The sub-components:

  • The Present Conditions Index fell by 2.7 points to 95.6, with the Expected Conditions Index down 5.5 points to 107.4.
  • 1-year economic outlook tumbled by 10.0 points to -5.6, with the “Good time to buy” sub-index falling by 7.2 points to -5.2.
  • 5-year economic outlook fell by 6.2 points to 11.5, while the current financial situation sub-index rose by 1.8 points to -3.6.
  • Expected financial situation saw a modest 0.6 point decline to 16.1.

The Kiwi Dollar moved from $0.70293 to $0.70260 upon release of the figures. At the time of writing, the Kiwi Dollar was down by 0.26% to $0.7009.

Elsewhere

At the time of writing, the Japanese Yen was up by 0.05% to ¥109.390 against the U.S Dollar, with the Aussie Dollar up by 0.06% to $0.7256.

The Day Ahead

For the EUR

It’s a particularly quiet day ahead on the economic calendar. There are no material stats due out of the Eurozone to provide the EUR with direction.

The lack of stats will leave the EUR in the hands of market risk appetite and sentiment towards FED monetary policy.

At the time of writing, the EUR was flat at $1.1726.

For the Pound

It’s a relatively quiet day ahead on the economic calendar. CBI Industrial Trend Orders for September are due out later today. With little else for the markets to consider, we can expect influence. The impact will be limited, however, with the Pound on the defensive ahead of Thursday’s policy decision.

At the time of writing, the Pound was up by 0.01% to $1.3658.

Across the Pond

It’s also a relatively quiet day ahead. Housing sector numbers for August are due out later in the day. With the markets focused on the FED, however, the stats are unlikely to have an impact on the day.

On Monday, the U.S Dollar Spot Index rose by 0.09% to end the day at $93.276.

For the Loonie

It’s a quiet day ahead for the Loonie. House price figures for August are due out later in the day.

We don’t expect the numbers to provide the Loonie with direction, however. Market risk sentiment will and crude oil prices will remain the key drivers on the day.

At the time of writing, the Loonie was up by 0.05% to C$1.2815 against the U.S Dollar.

For a look at all of today’s economic events, check out our economic calendar.

Gold Recovers as Worldwide Equites Sell Off

The worldwide equity selloff began overseas and then continued into the U.S. equities markets. At its low today the Dow Jones industrial average was down 900 points before recovering. The Dow gave up 614 points in trading today and closed at 33,970.47, resulting in a net decline of 1.78%. The NASDAQ composite lost 2.19% and is currently fixed at 14,713.9030. The S&P 500 lost 1.70% and is currently fixed at 4357.73.

gold sept 20

As of 5:56 PM EDT gold futures basis, the most active December 2021 contract is currently up to $13.30 and fixed at $1764.70. Silver did sustain a mild selloff closing lower by 0.41%, and after factoring in today’s decline of a little over nine cents, it is currently fixed at $22.245.

silver sept 20

Reuters reported that “Wall Street plunged on Monday as fear of contagion from a potential collapse of China’s Evergrande prompted a broad selloff and sent investors fleeing equities for safety.”

They also added that “the equity selloff in the United States was a result of concerns of solvency of the Chinese property group Evergrande. “Gold rose on Monday as fears about the solvency of Chinese property group Evergrande sparked a flight to safe-haven assets, but gains were capped by strength in the dollar ahead of the U.S. Federal Reserve’s policy meeting. Spot gold rose 0.5% to $1,762.66 per ounce by 1753 GMT. U.S. gold futures settled 0.8% higher at $1,765.40.”

The Chinese property to developers has accumulated over $300 billion in debt mostly with the Central Bank of China.

The Federal Reserve will meet tomorrow and begin September’s FOMC meeting, which will conclude on Wednesday. Market participants and traders hope to gain more clarity as to the timeline in which the Federal Reserve will begin to taper their monthly asset purchases of $120 billion (80 billion in U.S. debt and 40 billion in mortgage-backed securities).

There is genuine uncertainty as to what actions the Federal Reserve will take in regards to their current monthly asset purchases. Their asset balance sheet has swelled to above $8 trillion in assets. However, their primary focus has been upon maximum employment, a major component of their dual mandate which is maximum employment and annual inflationary levels of around 2%. They have let inflation run much hotter in lieu of achieving their maximum employment goal. Believing that the majority of the current level of inflation is transitory, the Federal Reserve has let inflation run to 5.3%, based upon the latest CPI numbers released last week.

However, the most recent jobs report was extremely disappointing and deeply below expectations and forecasts from economists polled by the Wall Street Journal. The expectation was that the August jobs report would indicate an additional 700,000+ new jobs added to payrolls, and the actual number was a tepid 235,000 new jobs added last month.

The weak August jobs report will be weighed against the most recent report by the U.S. Census Bureau, which indicated robust consumer spending last month, resulting in $618 billion, up 0.8%. Economists polled were looking for August consumer spending to be down between -0.8 to -1.8. If you strip out consumer spending on automobiles and trucks, the actual gain for the month of August is 1.8%.

These two reports show an interesting mix between new jobs added and consumer spending. While the jobs report was disappointing and weak at best, consumer spending rose far past the expectations given by economists. Therefore, the Federal Reserve will be faced with making a decision based on strong consumer spending and weak growth in jobs. That will certainly influence their decision as to when they will begin to taper.

For those who would like more information, simply use this link.

Wishing you, as always, good trading and good health,

Gary Wagner

 

European Equities: A Quiet Economic Calendar to Test Support Further

Economic Calendar

Thursday, 23rd September

Spanish GDP (QoQ) (Q2)

French Manufacturing PMI (Sep) Prelim

French Services PMI (Sep) Prelim

German Manufacturing PMI (Sep) Prelim

German Services PMI (Sep) Prelim

Eurozone Manufacturing PMI (Sep) Prelim

Eurozone Markit Composite PMI (Sep) Prelim

Eurozone Services PMI (Sep) Prelim

Friday, 24th September

German Ifo Business Climate Index (Sep)

The Majors

It was a particularly bearish start to the week for the European majors on Monday.

The DAX30 slid by 2.31% to lead the way down, with the CAC40 and the EuroStoxx600 seeing losses of 1.74% and 1.67% respectively.

Economic data on the day was limited to wholesale inflation figures from Germany, which had a muted impact on the majors.

The lack of stats left the markets with little to avert attention away from Wednesday’s FOMC policy decision and projections.

Following Friday’s pullback, dip buyers remained on the sidelines, with FED policy uncertainty testing support for the majors.

Adding to the market angst on the day was the Evergrande crisis, which sparked contagion fears across the global financial markets.

The Stats

It’s a was a quiet day on the Eurozone economic calendar. In August, Germany’s annual wholesale rate of inflation picked up from 10.4% to 12.0%. Economists had forecast an uptick to 11.4%. Month-on-month, Germany’s producer price index rose by 1.5%, following a 1.9% increase in July. Economists had forecast a more modest 0.8% increase.

From the U.S

It was also a particularly quiet day on the economic calendar, with no major stats for the markets to consider.

The Market Movers

For the DAX: It was a bearish day for the auto sector on Monday. Continental tumbled by 5.59% to lead the way down, with Volkswagen sliding by 3.89%. BMW and Daimler weren’t far off, however, with losses of 2.73% and 2.68% respectively.

It was also a bearish day for the banks. Deutsche Bank and Commerzbank slumped by 7.67% and by 7.92% respectively.

From the CAC, it was a bearish day for the banks. Soc Gen and BNP Paribas slid by 5.70% and by 4.46% respectively, with Credit Agricole falling by 3.86%.

It was also a bearish day for the French auto sector. Stellantis NV slid by 4.47%, with Renault falling by 2.19%.

Air France-KLM bucked the trend, rallying by 5.31%, while Airbus SE slipped by 0.97%.

On the VIX Index

It was a 3rd consecutive day in the green for the VIX on Monday.

Following an 11.34% jump on Friday, the VIX surged by 23.55% to end the day at 25.71.

On Monday, the NASDAQ slid by 2.19%, with the Dow and S&P500 ending the day down by 1.78% and by 1.70% respectively.

VIX 210921 Daily Chart

The Day Ahead

It’s another particularly quiet day ahead on the Eurozone’s economic calendar.

There are no major stats to provide the European majors with direction at the start of the week.

From the U.S there are also no major stats to consider later in the session, leaving the markets in limbo ahead of Wednesday’s FOMC.

The Futures

In the futures markets, at the time of writing, the Dow Mini was up by 4 points.

For a look at all of today’s economic events, check out our economic calendar.

September 21st 2021: EUR/USD Eyes H1 Prime Resistance at $1.1767-1.1776 After $1.17 Support

Charts: Trading View

EUR/USD:

(Italics: previous analysis)

Technical studies reveal movement hovering north of prime support at $1.1473-1.1583 on the weekly timeframe. Gleaning additional technical confluence through a 100% Fib projection at $1.1613 and 1.27% Fib extension at $1.1550, this base remains a key watch, long term. With respect to trend on the weekly chart, the market has largely been bullish since the early 2020.

Meanwhile, a closer reading of price on the daily timeframe reveals Monday spiked to within a stone’s throw of Quasimodo support at $1.1689. Albeit sponsoring a late August bid (black arrow), action from $1.1689 failed to find approval north of late July tops at $1.1909; therefore, this ranks $1.1689 as perhaps frail support. Assuming bearish leadership on the daily, the $1.1612 and $1.1602 (September/November 2020) lows signify downside support targets, followed by Fibonacci support between $1.1420 and $1.1522 (glued to the lower side of the weekly timeframe’s prime support at $1.1473-1.1583).

Charted a pip ahead of the daily Quasimodo, the $1.1690-1.1705 decision point put in an appearance on Monday, encouraging H4 sellers to dial back and hand the baton to buyers. Quasimodo support-turned resistance at $1.1742 is now in range on this timeframe, with subsequent bullish interest to perhaps take aim at Quasimodo resistance from $1.1771.

Intraday action on Monday was interesting. The US dollar, in addition to other safe-haven currencies such as the Japanese yen and Swiss franc, gained traction Monday, elevated amidst clear-cut risk-off sentiment. Europe’s single currency, however, reclaimed a large slice of lost ground, aided (technically) not only by the H4 decision point mentioned above at $1.1690-1.1705, but also $1.17 on the H1. At the time of writing, H1 resistance at $1.1728 is active; rupturing the latter paves the way to $1.1742 on the H4, a level shadowed by H1 prime resistance coming in at $1.1767-1.1776, joined by supply at $1.1762-1.1774.

Observed Levels:

Extending recovery gains on short-term charts may have sellers move in on prime resistance at $1.1767-1.1776 on the H1 and supply from $1.1762-1.1774, which dovetails with H4 Quasimodo resistance at $1.1771. However, prior to this, sellers might engage with Quasimodo support-turned resistance at $1.1742 on the H4.

An alternative scenario to be mindful of is a whipsaw south of $1.17 on the H1 to daily Quasimodo support parked at $1.1689. $1.1689 bids feeding off sell-stops below $1.17 could be enough to chalk up a bullish wave.

AUD/USD:

(Italics: previous analysis)

Latest out of the weekly timeframe has AUD/USD touching gloves with prime support at $0.6968-0.7242. Since printing a two-week recovery in late August, the currency pair has been fighting to entice fresh bullish interest. Failure to command position from $0.6968-0.7242 opens up support at $0.6673. Buyers regaining consciousness, nevertheless, has prime resistance at $0.7849-0.7599 to target. Trend studies on the weekly scale show we’ve been higher since early 2020. Consequently, the response from $0.6968-0.7242 could STILL be the beginnings of a dip-buying attempt to merge with the current trend.

The daily timeframe’s technical landscape informs traders bids are perhaps thin within weekly prime support, at least until price shakes hands with Fibonacci support at $0.7057-0.7126. Those who follow the relative strength index (RSI) will note the value journeyed through the 50.00 centreline last week and had Monday dip a toe below 40.00. This highlights a bearish atmosphere until making contact with oversold territory.

Price action on the H4 timeframe came within touching distance of a half-hearted decision point at $0.7200-0.7218 on Monday. To the upside, two resistances are on the radar at $0.7281 and $0.7317.

Lower on the curve, a H1 decision point at $0.7269-0.7259 elbowed into the spotlight, an area formed in the early hours of Monday which saw price tunnel through demand at $0.7248-$0.7259. Continued interest to the downside has $0.72 to target.

Observed Levels:

Each timeframe analysed underlines a bearish energy.

Weekly prime support at $0.6968-0.7242 appears vulnerable due to the daily timeframe exhibiting scope to approach Fibonacci support at $0.7057-0.7126. This, on top of the H1 timeframe’s decision point at $0.7269-0.7259 making a show, implies a short term move to $0.72 (H1) could be in the offing (note $0.72 aligns with the lower band of the H4 decision point at $0.7200-0.7218).

USD/JPY:

(Italics: previous analysis)

Since mid-July, ¥108.40-109.41 demand has failed to stir much bullish energy on the weekly timeframe. Nevertheless, recognising the area derives additional backing from neighbouring descending resistance-turned support, extended from the high ¥118.61, an advance could eventually emerge to familiar supply at ¥113.81-112.22.

The uninspiring vibe out of weekly demand is demonstrated by way of a consolidation on the daily timeframe between prime support at ¥108.96-109.34 and resistance from ¥110.86-110.27. Range support, as you can see, is currently in the frame. In the event price deviates from range extremes, Quasimodo resistance at ¥111.11 is seen, along with a concealed Quasimodo support at ¥108.43. Based on the relative strength index (RSI), the value is confined to a consolidation surrounding the 50.00 centreline, between 40.87 and 56.85.

Broad declines observed in major US equity indexes elevated demand for the safe-haven JPY Monday. USD/JPY downside swings technical curiosity to the H4 double-top pattern’s (¥110.44) profit target around ¥108.71—sharing chart space with a 1.618% Fibonacci projection at ¥108.86 and a 1.272% Fibonacci projection at ¥108.72. However, in order to reach the aforesaid pattern target, the lower edge of the daily range support highlighted above at ¥108.96-109.34 must be taken.

Heading into early US trading on Monday, H1 crossed swords with Quasimodo resistance-turned support at ¥109.45, and clocked a ¥109.65 top before changing gears and heading towards Quasimodo support at ¥109.31. Territory below the latter reveals support at ¥109.11.

Observed Levels:

In keeping with the H4 timeframe, booking additional losses is possibly on the cards until the double-top pattern’s (¥110.44) profit target around ¥108.71. Still, to reach the aforementioned profit target, sellers must marginally defeat the daily timeframe’s range support at ¥108.96-109.34 and take on any bullish interest from weekly demand at ¥108.40-109.41.

Should we nudge through H1 Quasimodo support at ¥109.31, this could be an early sign of bearish muscle making an entrance, and with this, additional selling might take shape.

GBP/USD:

(Italics: previous analysis)

In the shape of a hammer candlestick formation (bullish signal), supply-turned demand at $1.3629-1.3456 on the weekly timeframe stepped forward in July. The aforementioned zone remains active, welcoming an additional test mid-August. Yet, pattern traders will also note August’s move closed south of a double-top pattern’s neckline at $1.3669, broadcasting a bearish vibe. Conservative pattern sellers, however, are likely to pursue a candle close beneath $1.3629-1.3456 before pulling the trigger.

Sterling kicked off the week on the ropes, clocking one-month lows versus the US dollar. GBP/USD remains comfortable beneath the 200-day simple moving average at $1.3831 and is within reach of Quasimodo support at $1.3609. Previous analysis underlined the daily chart has communicated a rangebound environment since late June between a 61.8% Fib retracement at $1.3991 and the noted Quasimodo support. Momentum, according to the relative strength index (RSI) value, extended position below the 50.00 centreline and scraped through 40.00 on Monday. This informs traders that momentum to the downside is increasing in the form of average losses exceeding average gains.

Yesterday’s bearish presence established a decision point at $1.3750-1.3721, an area forming a decision to tunnel through Quasimodo support from $1.3693 (currently serving as resistance). Daily Quasimodo support mentioned above at $1.3609 calls for attention as a downside objective also on the H4 scale.

From the H1 timeframe, mid-way through London on Monday clipped the lower side of $1.37 and also brought in resistance at $1.3689—a previous Quasimodo support level drawn from 26th August. Further softening places Quasimodo support at $1.3618 and the $1.36 figure in sight.

Observed Levels:

Having noted scope for the daily timeframe to test Quasimodo support at $1.3609, retesting either H4 resistance at $1.3693 or the H4 decision point at $1.3750-1.3721 could stir a bearish theme. Adding weight to $1.3693 is H1 resistance coming in at $1.3689 and the $1.37 figure.

The H1 Quasimodo support at $1.3618 forms a reasonable downside target, arranged just north of the noted Quasimodo support on the daily timeframe.

DISCLAIMER:

The information contained in this material is intended for general advice only. It does not take into account your investment objectives, financial situation or particular needs. FP Markets has made every effort to ensure the accuracy of the information as at the date of publication. FP Markets does not give any warranty or representation as to the material. Examples included in this material are for illustrative purposes only. To the extent permitted by law, FP Markets and its employees shall not be liable for any loss or damage arising in any way (including by way of negligence) from or in connection with any information provided in or omitted from this material. Features of the FP Markets products including applicable fees and charges are outlined in the Product Disclosure Statements available from FP Markets website, www.fpmarkets.com and should be considered before deciding to deal in those products. Derivatives can be risky; losses can exceed your initial payment. FP Markets recommends that you seek independent advice. First Prudential Markets Pty Ltd trading as FP Markets ABN 16 112 600 281, Australian Financial Services License Number 286354.

USD/CAD Exchange Rate Prediction – The Dollar Rise on Risk-off Trade

 

The dollar surged higher and hit key resistance levels as Canada went to the polls on Monday.  Riskier assets headed south which has benefited the greenback as a safe-haven currency. Prime Minister Trudeau and his Conservative challenger O’Toole appear to be running neck and neck.

Technical Analysis

The dollar moved higher against the Loonie, as the safe-haven lure of the greenback pushed the U.S. currency higher against most major currencies. The exchange rate hit resistance near an upward sloping trend line that comes in near 1.2910. Support on the exchange rate is seen near the 10-day moving average at 1.2690 and the 50-day moving average at 1.2600. The exchange rate is overbought as the fast stochastic is printing a reading of 81, above the overbought trigger level of 80, which could foreshadow a correction. Short-term momentum has turned negative as the fast stochastic generated a crossover sell signal. Medium-term momentum is positive as the MACD (moving average convergence divergence) index generated a crossover sell signal. The MACD histogram is printing in negative territory with a rising trajectory which points to a higher exchange rate.

The Debt Ceiling Generates Risk

Congress has been stalling any movement related to future spending despite urging from Treasury Secretary Yellen to act.  There are rumors that The House of Representation may take up a stop-gap measure to extend expenditures, but this attempted will have difficulty in the Senate.

Silver Price Prediction – Prices Test Key Support as Prices are Oversold

Silver prices moved lower but bounced off key support levels despite a rally in the dollar. The rise of the greenback on Monday generated headwinds for silver prices as risk-off speed accelerates. U.S. Yields moved. Gold prices have failed to become the security of choice during a risk-off period, edged slightly higher, which helped buoy silver.

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Technical analysis

Silver prices continued to trend lower but held key support levels seen near the August and December lows at 21.95. If prices are able to close above this level for consecutive days it will likely generate a bounce Prices remained below resistance seen near the 10-day moving average, at 23.51. Target support is seen near the August lows at 22.10. Short-term momentum has reversed and turned positive as the fast stochastic generated a crossover buy signal. Prices are oversold as the fast stochastic is printing a reading of 9, below the oversold trigger level of 20, which could foreshadow a correction.

Medium-term momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover signal. This sell signal occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in negative territory with a downward sloping trajectory which points to lower prices.

Debt Ceiling is not Under Control

The risk-off trade accelerated, continuing the trend experienced at the end of last week.  Congress has been stalling despite urging from Treasury Secretary Yellen to act.  There are rumors that The House of Representation may take up a stop-gap measure to extend spending, but this attempted will have difficulty in the Senate.

Wall Street Ends Sharply Lower in Broad Sell-Off

The Nasdaq fell to its lowest level in about a month, and Microsoft Corp, Alphabet Inc, Amazon.com Inc, Apple Inc, Facebook Inc and Tesla Inc were among the biggest drags on the index as well as the S&P 500.

All 11 major S&P 500 sectors were lower, with economically sensitive groups like energy down the most.

Investors also were nervous ahead of the Federal Reserve’s policy meeting this week.

The banking sub-index dropped sharply while U.S. Treasury prices rose as worries about the possible default of Evergrande appeared to affect the broader market.

“You kind of knew that when there was something that caught markets off guard, that it was going to lead to probably a bigger sell-off and you didn’t know what the reason would be,” said Sameer Samana, senior global market strategist at Wells Fargo Investment Institute.

“I guess it’s the China news but… it’s not altogether surprising given how bullish people were.”

Wednesday will bring the results of the Fed’s policy meeting, where the central bank is expected to lay the groundwork for a tapering, although the consensus is for an actual announcement to be delayed until the November or December meetings.

Unofficially, the Dow Jones Industrial Average fell 620.22 points, or 1.79%, to 33,964.66, the S&P 500 lost 75.28 points, or 1.70%, to 4,357.71 and the Nasdaq Composite dropped 325.95 points, or 2.17%, to 14,718.02.

The S&P 500 is down sharply from its intra-day record high hit on Sept. 2 and is on track to snap a seven-month winning streak.

Strategists at Morgan Stanley said they expected a 10% correction in the S&P 500 as the Fed starts to unwind its monetary support, adding that signs of stalling economic growth could deepen it to 20%.

The CBOE volatility index, known as Wall Street’s fear gauge, rose.

For a look at all of today’s economic events, check out our economic calendar.

(Reporting by Caroline Valetkevitch in New York; additional reporting by Devik Jain and Sagarika Jaisinghani in Bengaluru and by Noel Randewich in San Francisco; Editing by Sriraj Kalluvila and Lisa Shumaker)

Natural Gas Price Prediction – Prices Slide Through Support as Supply Increases

Natural gas prices moved lower on Monday as fear of tropical storm activity abated.  The weather is expected to be warmer than normal over the next 6-10 days, but then becomes milder, according to a forecast from the National Oceanic Atmospheric Administration. The most recent report from the EIA showed a larger than expected build in natural gas inventories, but stocks remain well below the 5-year average. U.S. Supply increased in the latest week.

Technical Analysis

On Monday, natural gas prices dropped sharply, falling 2.75% and gapping lower through key support, which is now resistant near the 10-day moving average at 5.08. Support is seen near the 50-day moving average at 4.23. Short-term momentum has turned negative as the fast stochastic recently generated a crossover sell signal. Medium-term positive momentum is decelerating as the MACD (moving average converge divergence) histogram is printing in negative territory with a declining trajectory which points to consolidation.

Supply Increases

U.S. supply increases as production begins to come back online in the Gulf of Mexico. According to data from the EIA, the average total supply of natural gas rose by 1.7% compared with the previous report week. Dry natural gas production grew by 1.4%, or 1.3 Bcf per day, compared with the previous report week. According to daily reports from BSEE, on a weekly basis, natural gas production outages in the Federal Offshore Gulf of Mexico decreased by about 0.6 Bcf per day this report week compared with the last report.

E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – Weakens Under 14920.25, Strengthens Over 15069.75

December E-mini NASDAQ-100 Index futures are trading lower at the mid-session as global technology shares take a hit across the board. No sector or subsector is safe from heavy selling pressure during today’s session. The catalysts behind the sell-off are worries over the strength of the global market recovery and fear that economic problems in China will spread to other financial markets.

At 17:10 GMT, December E-mini NASDAQ-100 Index futures are trading 14887.50, down 438.50 or -2.86%.

In stock related news, Advanced Micro Devices Inc is the performing the worst, down 3.22%. Adobe Inc is down 2.28%. Align Technology is off by 2.50%, Amazon.com Inc is weaker by 3.53% and Amgen Inc is trading 1.70% lower.

Daily December E-mini NASDAQ-100 Index

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum is trending lower.  A trade through 14699.00 will change the main trend to down. A move through 15702.25 will signal a resumption of the uptrend.

The minor trend is down. This is controlling the momentum. A trade through 15532.50 will change the minor trend to up.

The short-term range is 14437.00 to 15702.25. The index is currently testing the lower end of its retracement zone at 15069.75 to 14920.25.

The main range is 13450.00 to 15702.25. If the main trend changes to down then look for the selling to possibly extend into its retracement zone at 14576.00 to 14310.25.

The minor range is 14699.00 to 15702.25. Its 50% level at 15200.75 is additional resistance.

Daily Swing Chart Technical Forecast

The direction of the December E-mini NASDAQ-100 Index into the close on Monday is likely to be determined by trader reaction to 14920.25.

Bearish Scenario

A sustained move under 14920.25 will indicate the presence of sellers. If this move creates enough downside momentum then look for the selling to possibly extend into the main bottom at 14699.

Taking out 14699 will change the main trend to down and could trigger an acceleration into the retracement zone at 14576.00 to 14310.25. Look for buyers on the first test of this area.

Bullish Scenario

A sustained move over 14920.50 will signal the return of buyers. This could create a lowered rally with potential upside targets coming in at 15069.75 and 15200.75.

Overtaking 15200.75 will indicate the buying is getting stronger. Overcoming 15326.00 will put the index in a position to form a potentially bullish closing price reversal bottom.

For a look at all of today’s economic events, check out our economic calendar.

E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Weak Under 33826, Strong Over 34132

December E-mini Dow Jones Industrial Average futures are down sharply at the mid-session on Monday as concerns about the pace of a global recovery spurred a sell-off across sectors at the start of a week in which the Federal Reserve will decide on potentially tapering its pandemic-era stimulus.

At 16:42 GMT, December E-mini Dow Jones Industrial Average futures are trading 33739, down 723 or -2.10%.

In stock related news, Dow Component Caterpillar Inc is down 4.86%. Goldman Sachs Group Inc is off by 4.4%, followed by American Express and JPMorgan Chase & Co, which are both lower by 3.47%. Dow Inc is down 3.28%.

Daily December E-mini Dow Jones Industrial Average

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. The next major downside target is the July 19 main bottom at 33533, followed by the June 21 main bottom at 32835.

A trade through 35383 will change the main trend to up. This is highly unlikely, but due to the prolonged move down in terms of price and time, traders should start watching for a closing price reversal bottom chart pattern. This would change the trend, but if confirmed, it could trigger the start of a 2 to 3 day correction.

The main range is 32835 to 35429. The Dow just crossed over to the weak side of its retracement zone at 33826 to 34132, making it new resistance.

Daily Swing Chart Technical Forecast

The direction of the December E-mini Dow Jones Industrial Average into the close on Monday is likely to be determined by trader reaction to 33826.

Bearish Scenario

A sustained move under 33826 will indicate the presence of sellers. If this move continues to generate enough downside momentum then look for the selling to extend into 33533. Taking out this level could trigger an acceleration to the downside with 32835 the next likely target.

Bullish Scenario

A sustained move over 33826 will signal the return of buyers. If this move generates enough upside momentum then look for a possible intraday surge into 34132. Overtaking this area could put the Dow in a position to close higher for the session and thus form a closing price reversal bottom.

For a look at all of today’s economic events, check out our economic calendar.

Gold Price Prediction – Prices Experience Dead-Cat Bounce

Gold prices traded sideways and continued to experience a dead-cat bounce. The upward momentum was drained by the selloff last week. The rally in the dollar on Monday generated headwinds for gold prices as risk-off speed accelerates. U.S. Yields moved lower as the safety of U.S. treasury bonds lured traders. Gold prices have failed to become the security of choice during a risk-off period. The U.S. debt ceiling is approaching, which means that Congress needs to extend spending, or the government will shut down.

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Technical analysis

Gold prices consolidated and continue to form a bear flag pattern. This scenario is a continuation pattern that pauses before it refreshes lower. Generally, the recovery from a sharp selloff is muted forming a dead-cat bounce before prices start to move lower again. Prices remained below resistance seen near the 10-day moving average, at 1,782. Target support is seen near the August lows at 1,677. The 10-day moving average has crossed below the 50-day moving average, which means that a short-term downtrend is now in place. Short-term momentum has reversed and turned positive as the fast stochastic generated a crossover buy signal. Prices are oversold as the fast stochastic is printing a reading of 17, below the oversold trigger level of 20, which could foreshadow a correction.

Medium-term momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover signal. This sell signal occurs as the MACD line (the 12-day moving average minus the 26-day moving average) crosses above the MACD signal line (the 9-day moving average of the MACD line). The MACD histogram is printing in negative territory with a downward sloping trajectory which points to lower prices.

USD/CAD Daily Forecast – Canadian Dollar Is Under Pressure At The Start Of The Week

U.S. Dollar Gains Ground Against Canadian Dollar

USD/CAD made an attempt to settle above the resistance at 1.2900 but lost momentum and declined towards 1.2830 while the U.S. dollar lost momentum against a broad basket of currencies.

The U.S. Dollar Index faced strong resistance at 93.40 and declined towards 93.20. The nearest support level for the U.S. Dollar Index is located at 93.10. In case the U.S. Dollar Index declines below this level, it will head towards the support at 92.80 which will be bearish for USD/CAD.

While it’s an Election Day in Canada, foreign exchange market traders focused on general market sentiment and dynamics of commodity markets which were under pressure on fears about financial problems of China’s Evergrande.

U.S. dollar was gaining ground against a broad basket of currencies as demand for safe-haven assets increased. However, traders were not ready to push the U.S. currency towards yearly highs as they remained cautious ahead of the Fed meeting.

Meanwhile, Canadian dollar was under pressure as WTI oil made an attempt to settle below the psychologically important $70 level. If WTI oil settles below this level, it will head towards the 50 EMA at 69.40 which will be bearish for commodity-related currencies, including Canadian dollar.

Technical Analysis

usd cad september 20 2021

USD to CAD is currently trying to settle back above 1.2830. RSI is close to the overbought territory, but there is enough room to gain upside momentum in case the right catalysts emerge.

In case USD to CAD manages to settle above 1.2830, it will head towards the next resistance level at 1.2850. A successful test of this level will open the way to the test of the resistance at 1.2865. If USD to CAD gets above 1.2865, it will head towards the next resistance at 1.2900.

On the support side, a move below 1.2830 will push USD to CAD towards the support at 1.2785. In case USD to CAD declines below 1.2785, it will head towards the support at 1.2760. A move below 1.2760 will open the way to the test of the support at 1.2730.

For a look at all of today’s economic events, check out our economic calendar.

S&P 500 Price Forecast – Stock Markets Break Trendline

The S&P 500 has fallen hard during the trading session on Monday, breaking below a major trendline. Furthermore, the market is below the 50 day EMA, something that catches a lot of people’s attention. With this being the case, it is very likely that the 4350 level is an area where we have seen a little bit of support. At this point though, it looks as if the market is trying to break down rather significantly, and if that is going to be the case, then I might be a buyer of puts. I will not get crazy to the short side, because quite frankly it is just so difficult to imagine a scenario where I am comfortable shorting a market that is so highly manipulated. At this point, the market is struggling overall, and I would be cautious about anything the Federal Reserve says or does.

S&P 500 Video 21.09.21

The 4300 level being broken probably opens even more stringent selling, but again, I would not be short of this market, rather I would be a buyer of puts. If we turn around to take out the top of the candlestick for the trading session on Monday, that would be a very bullish sign, and eventually make this a “false breakout”, something that causes a lot of trouble for short sellers.

Regardless, this is a market that I think will eventually find a reason to go higher, if for no other reason than the Federal Reserve stepping in and jawboning the market, or perhaps getting involved in the bond market. Yes, there are a lot of concerns out there when it comes to credit situations in China, but that being said Wall Street always seems to have a narrative that it hangs on to to start buying again.

For a look at all of today’s economic events, check out our economic calendar.