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Daily Technical Insights 15 November 2022


EURUSD (4-Hour Chart)

The EURUSD pair eases from a three-month high of 1.0363 on Monday as risk appetite cooled at the beginning of the new week. The pair was trading at the 1.0330 area at the time of writing, as investors keep a close eye on comments from central bankers, which, in turn, allows the US Dollar to hold its ground and limits the pair’s upside. In the Eurozone, Industrial Production was up by 0.9% MoM in September, also rising by 4.9% compared to a year earlier and beating market expectations. Moreover, there are growing hopes tensions between Russia and Ukraine could soon ease after Moscow retreated and Ukraine President Volodymyr Zelenskyy noted the country is ready for peace. However, the news should be taken with a pinch of salt, as it seems quite unlikely Russia will back from the separatist regions.

From the technical perspective, the four-hour scale RSI indicator remained above 70 figured as of writing, which suggested that the pair was still amid strong upside traction, but needed to be cautious about the corrective pullback. As for the Bollinger Bands, the euro was pricing in the higher area, above the 20-period moving average. Therefore, we think the positive buying would persist unless the price dropped below the 20-period moving average or the 1.0163 support.

Resistance: 1.0610, 1.0368

Support: 1.0163, 0.9951, 0.9730

GBPUSD (4-Hour Chart)

The GBPUSD has lost its recovery momentum after reaching above 1.1800 earlier in the day and retreated below 1.1750, with investors taking a step back and reassessing the market situation following last week’s risk rally. While commenting on the market reaction to the soft October Consumer Price Index data, Federal Reserve Governor Christopher Waller pushed back against optimism by saying that markets were “way out in front.” Waller added that the 7.7% annual CPI was still “enormous.” In the absence of high-impact macroeconomic data releases, market participants will pay close attention to what Fed officials say. In case safe-haven flows return to markets and Wall Street’s main indices turned south after last week’s impressive upsurge, the US Dollar could keep its footing and limit the British pound’s upside room and vice versa. In the domestic, investors could refrain from making large bets while waiting for the UK government to unveil its budget plan on Thursday. Chancellor Jeremy told the BBC on Sunday that he has been completely explicit that taxes are going to go up.

From the technical perspective, the four-hour scale RSI indicator slightly edged lower to 62 figured as of writing, suggesting that the pair witnessed less buying than last week. As for the Bollinger Bands, the pair was still pricing above the 20-period moving average, which is a signal that the pair was more favoured to the upside path. As a result, the price remained the positive tendency but the strength is mild unless there are any surprising events or breaking through the critical resistance/ support levels.

Resistance: 1.1901, 1.2157

Support: 1.1639, 1.1353, 1.1140

XAUUSD (4-Hour Chart)

The gold started the day with a soft tone and declined to an intraday low of $1753 and was trading at $1775 at the moment of writing, as the American Dollar recovered some ground on Monday but quickly resumed its decline ahead of the US opening as investors keep moving away from it. The financial markets are quieter following two days of wild price action spurred by signs of easing inflation in the United States. The October Consumer Price Index (CPI) rose at an annual pace of 7.7%, much lower than the 8% anticipated by the market or the record peak of 9.1% from last June. Investors rushed to drop the US Dollar amid the mounting speculations that the Federal Reserve will pivot on the monetary policy in their upcoming December meeting. Apart from this, US President Joe Biden met with his Chinese counterpart Xi Jinping. The versions of the outcome differ by country. On the one hand, Biden said that they are not looking for conflict and that there will not be a new Cold War. On the other hand, Chinese media reported that President Xi warned the US about crossing a “red line” in Taiwan.

From the technical perspective, the four-hour scale RSI indicator remained above 70 figured as of writing, suggesting that the gold has preserved its upside strength, but market anticipants needed to be cautious of a corrective pullback. As for the Bollinger Bands, the yellow metal was pricing in the upper area. Therefore, we think an upside movement in the near future could be expected.

Resistance: 1802, 1857

Support: 1748, 1704, 1658