[WEEKLY TECHNICAL ANALYSIS WITH CANDLESTICK CHARTS – 30 JANUARY 2022]
WEEKLY SNAPSHOT
Manufacturing PMI, U.K.
WHEN: WHAT IT HAD INFLUENCED:
24th JANUARY 2022 GBP and its subsequent pairs
WHAT HAPPENED: The Manufacturing Purchasing Managers’ Index (PMI) measures the activity level of purchasing managers in the manufacturing sector. A reading above 50 indicates expansion in the sector; below 50 indicates contraction.
GBPAUD is trading in the up channel. Further upside can be seen in the coming week.
CB Consumer Confidence (Jan), U.S.
WHEN: WHAT IT HAD INFLUENCED:
25th JANUARY 2022 USD and its subsequent pairs
WHAT HAPPENED: Conference Board (CB) Consumer Confidence measures the level of consumer confidence in economic activity. It is a leading indicator as it can predict consumer spending, which plays a major role in overall economic activity. Higher readings point to higher consumer optimism.
USDCAD is currently in the upward channel. Further upside can be seen in the coming week.
CPI (QoQ) (Q4), AUSTRALIA
WHEN: WHAT IT HAD INFLUENCED:
24th JANUARY 2022 AUD and its subsequent pairs
WHAT HAPPENED: The Consumer Price Index (CPI) measures the change in the price of goods and services from the perspective of the consumer. It is a key way to measure changes in purchasing trends and inflation.
AUDCHF is currently in the downward channel. Further downside can be seen in the coming week.
Gold Down 2% on Week and Under $1800 as Fed Bites Longs
WHAT IT HAD INFLUENCED:
GOLD
WHAT HAPPENED: The two-week long party in gold has proven to be exactly that: two weeks long.
Bulls in the precious metal trying to hold on the $1,800 handle and reach for $1,900 next saw their hopes dashed by a Federal Reserve that took a big bite out of the gold market with its super-hawkish monetary policy to wade the U.S. out of the worst inflation crisis in decades.
Gold futures’ most active contract on New York’s Comex, April, settled down $8.40, or 0.5%, at $1,778.80 an ounce. Over the past two sessions, the benchmark gold futures contract fell just shy of $60 in total. That handed the contract a weekly loss of more than 2%, virtually wiping out the back-to-back gains of the past two weeks.
The Federal Reserve unveiled this week a new hawkish era for U.S. monetary policy, with Chairman Jerome Powell not discounting the possibility that U.S. interest rates might go up every month this year after the first pandemic-era hike is in, possibly in March.
GOLD was trading in the upward channel. The further downside will be seen after the breakout this coming week.
Oil hits 7-year peak on political risks, supply crunch
WHAT IT HAD INFLUENCED:
CRUDE OIL
WHAT HAPPENED:
Oil prices rose to a more than seven-year peak on Friday and recorded their sixth straight weekly gain as geopolitical turmoil exacerbated concerns over tight energy supply.
On a weekly basis, the benchmark contracts notched their longest run of gains since October. Brent futures rose 69 cents to settle at $90.03 a barrel, after hitting $91.70, the highest level since October 2014.
U.S. crude closed 21 cents higher at $86.82 per barrel, after hitting a seven-year peak of $88.84 during the session.
Tight oil supplies pushed the six-month market structure for Brent into steep backwardation of $6.92 a barrel, the widest since 2013. Backwardation exists when contracts for near-term delivery of oil are priced higher than those for later months, encouraging traders to release oil from storage to sell it promptly.
WTI CRUDE OIL is trading in the up channel. Further upside can be seen in the coming week.
Ethereum hash rate scores new ATH as PoS migration underway
WHAT IT HAD INFLUENCED:
ETHEREUM
WHAT HAPPENED:
Over the previous year, Ether (ETH) has increased in value to the point that it significantly outperformed Bitcoin (BTC) in terms of returns. The rise of Ethereum has made mining on its network more lucrative over time. This appears to have resulted in additional miners, resulting in an expansion of the network’s hash rate.
The hash rate for Ethereum has hit a new high, approaching record levels of 1.11 PH/s, according to data from Glassnodes on Thursday. The previous ATH was reached previously on Jan. 13, when the ETH price fell from $4,460 to $3,160.
ETHEREUM is currently in the downward channel. Further downside can be seen in the coming week.
5 KEY EVENTS TO WATCH OUT
Manufacturing PMI, U.K.
WHEN: WHAT IT INFLUENCES:
01st FEBRUARY 2022 GBP and its subsequent
Pairs
WHAT’S HAPPENING: The Manufacturing Purchasing Managers’ Index (PMI) measures the activity level of purchasing managers in the manufacturing sector. A reading above 50 indicates expansion in the sector; below 50 indicates contraction.
A higher-than-expected reading ought to be taken as positive/bullish for the GBP, whereas a lower-than-expected reading should be taken as negative/bearish for the GBP.
Initial Jobless Claims, U.S.
WHEN: WHAT IT INFLUENCES:
03rd FEBRUARY 2022 USD and its subsequent
Pairs
WHAT’S HAPPENING: Initial Jobless Claims measures the number of individuals who filed for unemployment insurance for the first time during the past week. This is the earliest U.S. economic data, but the market impact varies from week to week.
A higher-than-expected reading ought to be taken as negative/bearish for the USD, whereas a lower-than-expected reading should be taken as positive/bullish for the USD.
Unemployment Change (Jan), GERMANY
WHEN: WHAT IT INFLUENCES:
01st FEBRUARY 2022 EUR and its subsequent
Pairs
WHAT’S HAPPENING: German Unemployment Change measures the change in the number of unemployed people during the previous month.
A higher-than-expected reading ought to be taken as negative/bearish for the EUR, whereas a lower-than-expected reading should be taken as positive/bullish for the EUR.
RBA Interest Rate Decision (Feb), AUSTRALIA
WHEN: WHAT IT INFLUENCES:
31st JANUARY 2022 AUD and its subsequent
Pairs
WHAT’S HAPPENING: Reserve Bank of Australia (RBA) board members come to a consensus on where to set the rate. Traders watch interest rate changes closely as short-term interest rates are the primary factor in currency valuation.
A higher-than-expected reading ought to be taken as positive/bullish for the AUD, whereas a lower-than-expected reading should be taken as negative/bearish for the AUD.
GDP (MoM) (Nov), CANADA
WHEN: WHAT IT INFLUENCES:
01st FEBRUARY 2022 CAD and its subsequent
pairs
WHAT’S HAPPENING: Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health. Canada releases fresh GDP data on a monthly basis.
A higher-than-expected reading ought to be taken as positive/bullish for the CAD, whereas a lower-than-expected reading should be taken as negative/bearish for the CAD.
EQUITIES IN THE COMING WEEK
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Exxon Mobil (XOM) to announce its Quarterly Results on 01st FEBRUARY 2022, EPS estimated to 1.89 per share while revenue estimated 85.01B.
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PayPal Holdings Inc (PYPL) to announce its Quarterly Results on 01st FEBRUARY 2022, EPS estimated to 1.12 per share while revenue estimated 6.9B.
3**. Meta Platforms (FB)** to announce its Quarterly Results on 02nd FEBRUARY 2022, EPS estimated to 3.85 per share while revenue estimated 33.35B.
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Honeywell (HON) to announce its Quarterly Results on 03rd FEBRUARY 2022, EPS estimated to 2.08 per share while revenue estimated 8.74B.
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Carlsberg AS (CABGY) to announce its Quarterly Results on 04th FEBRUARY 2022, EPS estimated to 0.2878 per share while revenue estimated 2.24B.