Spreads
Spreads
Spreads
Spreads
Spreads
EURUSD continued to fall for the second straight day despite efforts to recover above 0.96. The energy crisis continues to trouble the European economy; furthermore, with Russia expanding its aggression by the day, the spillover effect of the Russian-Ukrainian war will quickly take a toll on the whole European economy. On Wednesday, ECB President Christine Lagarde will participate in the Frankfurt Forum, and so will Fed Chair Jerome Powell. Both heads of central banks are expected to deliver a speech.
On the technical side, EURUSD has traded slightly below our previous estimated support level of 0.96. The pair is attempting to defend this support level, but with the U.S. Greenback gaining more demand by the day, we expect a lower support level for the pair at around 0.95. RSI for the pair sits at 32.08, as of writing. On the four-hour chart, EURUSD currently trades well below its 50, 100, and 200-day SMA.
Resistance: 1.0011, 1.0055
Support: 0.96, 0.94
Cable, after sinking to historical lows on Tuesday, has recovered 0.43% by yesterday’s close. The broadly weaker Dollar across markets has allowed the British Pound to gain traction against the U.S. Greenback. The British Pound was also stimulated by the BoE’s, seemingly emergency, statement after the Pound’s plunge. The statement by the BoE stated that the central bank will intervene in the decline shall the British Pound continue to fall uncontrollably. Markets are still pricing in an 80% chance that the BoE will raise rates to 3.5% by November from 2.25%.
On the technical side, GBPUSD has rebounded from our previously estimated support level of 1.035. Short-term resistance for GBPUSD stands at around 1.08 and 1.12. RSI for the pair sits at 40.37, as of writing. On the four-hour chart, GBPUSD currently trades below its 50, 100, and 200-day SMA.
Resistance: 1.1561, 1.1854
Support: 1.035, 1.000
Gold found some breathing room on the 27th as the Dollar slowed its growth. Furthermore, as mentioned in yesterday’s report, the mobilization of Russia’s armed forces, riots in Iran, geopolitical and instability in the South China Sea have all contributed as a potential catalyst for astronomical upside potential for Gold. On the contrary, tightening by global central banks has eliminated any upward space for Gold save a catastrophic global geopolitical conflict.
On the technical side, XAUUSD has broken below our previously estimated support level of $1640 per ounce and is heading towards our estimated next level of support at $1600 per ounce. RSI for the non-yielding gold sits at 37.83, as of writing. On the four-hour chart, XAUUSD currently trades below its 50, 100, and 200-day SMA.
Resistance: 1695, 1724
Support: 1620, 1600
