WTI Oil

WTI oil is set to continue its downward trend after a brief consolidation period on early Thursday. This follows a significant drop the previous day, marking the largest daily loss since July 5, 2022.

The sentiment has been affected by concerns over demand following recent weak economic data, suggesting a potential further slowdown in global economic growth.

The OPEC+ group, in their meeting on Wednesday, decided to maintain their current oil output policy. Saudi Arabia and Russia have chosen to keep their voluntary output cut unchanged for the rest of the year. Oil prices have dropped to a one-month low, with Wednesday's sharp fall contributing to a reversal pattern on the daily chart.

The price has broken through a key Fibonacci support level at $84.31, indicating that the major downtrend from the 2023 high of $95.00 may continue.

Despite strong bearish momentum, there are signs that the downtrend may start to weaken. However, any price increases should be limited and present better selling opportunities. The previous consolidation floor and broken Fibonacci level at $88.00/40 should limit any significant price increases.

Resistance: 84.90; 86.00; 87.54; 88.00.
Support: 83.88; 81.71; 81.00; 80.00.

USDJPY Technical Analysis

The USDJPY is currently around the middle of Tuesday's range of 150.16 to 147.29. This movement was caused by signs that Japan might step in to help their weakening currency, the yen.

Recent reports from the Bank of Japan say there was no such intervention. However, people are still wary because the chance of intervention is high. They're waiting for the US September NFP report, which will give more information about the US job market and what the Federal Reserve might do next.

Daily technical studies are still positive, but the 4-hour structure has weakened. This suggests there's a risk of a downturn, even though strong bids on Tuesday have offset some of this risk.

The NFP report could trigger new activity and provide fresh signals for direction. If the September numbers are solid (at or above the expected 170K), it would ease the Federal Reserve and allow for higher interest rates for a longer time.

On the other hand, if hiring in September is weaker than expected, it would mean that the tight job market is being hurt by high borrowing costs. This could lead to worries about a major economic slowdown and require a more careful approach from the Federal Reserve.

We can expect new direction signals if either pivot point is broken. If it drops below 147.29 (Tuesday's low), there's a risk of a deeper drop. If it breaks above 150, it could signal a continuation of the bullish trend, although there's still a risk of intervention.

Resistance: 148.72 - 149.31 - 149.7
Support: 148.25 - 147.29 - 146.10 - 145.9

Strong Job Data Impacts Investments and Oil Prices

The path to a safe economic slowdown, which doesn't harm investments, is tricky. After the release of the latest job data (NFP data), people are worried. They think the fast growth might affect one of the main goals of the Federal Reserve (the Fed). The job data shows that there's not much improvement in job balance, so the Fed might need to take more actions. This strong job data could be seen as bad for investments and might make the dollar stronger.

Oil prices were already going down because people were scared of a recession caused by high interest rates. The strong job data might limit the increase in oil prices. If US 10-year loan interest rates get close to 5%, it might cause another drop in oil prices.

Bitcoin is better than digital Gold

Bitcoin and gold are both seen as valuable assets, according to a recent report by Matrixport. Bitcoin's popularity has surged due to its digital nature, making it a desirable asset. Currently, Bitcoin's market value is $540 billion, which is about 10.8% of the total value of physical gold. Gold ETFs, on the other hand, are worth $200 billion.

The report suggests that if the U.S. Securities and Exchange Commission (SEC) approves a Bitcoin ETF, it could attract an investment of $20 - $30 billion. This could potentially cause a significant increase in Bitcoin's value. However, the SEC has been slow in making a decision on this matter and has postponed all new applications until October. Despite this, the crypto market remains optimistic about the potential influx of mainstream investment.

Interestingly, Bitcoin has an advantage over gold. You can remember your private keys, which means there's no risk of them being taken away.

Matrixport's head of research, Markus Thielen, pointed out that storing wealth in gold is becoming less popular in today's digital age. It also has limitations when it comes to international transactions. In contrast, Bitcoin allows for quick and discreet transfers of value across borders.

In conclusion, given the current technological advancements, Bitcoin serves two main purposes. It acts as a store of value similar to gold and as a speculative financial asset.

EURUSD Technical Analysis

The EURUSD currency pair is currently following a downward trend, even though there has been a recent increase in its value.

There are certain points, known as resistance points, which could potentially halt the currency pair's upward movement. The first resistance point could be at 1.0617, which is where the recent high value was observed. Another resistance point could be at 1.0673, which aligns with the 34-day simple moving average (SMA), a trend indicator.

Further up, the 100-day and 200-day SMAs might also act as resistance points near the value of 1.0830.

On the other hand, if the value of the currency pair starts to decrease, it might find support (a level where the price might stop falling) near the recent low values of 1.0480 and 1.0440.

USDJPY

source: fxnews.me

The USDJPY currency pair has seen a resurgence of momentum on Tuesday, although it continues to trade within a range that has persisted for four consecutive days.

The currency pair's pullback from its 2023 peak of 150.16 has consistently found support at the rising 20-day moving average (20DMA), currently at 148.58, indicating strong buying interest.

The broader uptrend from the 2023 low of 127.22 remains unbroken, and the near-term price action suggests a minor correction before the bulls take over once again.

A close above the 10-day moving average (10DMA) at 149.12 would provide an initial bullish signal, paving the way for a retest of key resistance levels at 150.00 (a psychological level) and 150.16 (the high for 2023). These levels are just below the peak for 2022 and a multi-decade high of 151.94.

The daily chart shows strong positive momentum, with the Tenkan-sen and Kijun-sen lines in a bullish configuration. The price action is also supported by a rising and thickening daily Ichimoku cloud, keeping the focus on further upside potential.

However, traders should be cautious if the price breaks below the 20DMA, as this would weaken the near-term structure. A move and close below the spike low of 147.29 from October 3rd would be required to sideline the bulls and signal a deeper correction.

Resistance levels to watch are at: 149.12; 149.53; 150; and 150.16.
Support levels to watch are at: 148.00; 147.29; 146.1; and 145.9.

Gold

Our latest gold market analysis shows a rise in gold prices to $1,859, following a rebound from the $1,805 support area. Key indicators, including the RSI and stochastic indicator, suggested a potential rise. A bullish engulfing candlestick pattern near the $1,805 support on the daily chart signals a potential market reversal.

On the 4H chart, gold price is grappling with a non-linear trendline and RSI near level 70. However, a significant barrier at the $1,883 pivot point suggests a stronger bearish scenario. We suggest a sell stop at 1,849, targeting 1,806, with risk at 1,870.

Always do your own research before trading.

source: fxnews.me

NZDUSD

The NZDUSD currency pair, which represents the value of the New Zealand Dollar against the US dollar, is currently testing what we call ‘signal lines’ of a certain indicator. This is like a student taking a test to see how well they’re doing.

Now, the price of this currency pair is moving above something known as the ‘Ichimoku Cloud’. The Ichimoku Cloud is a tool that traders use to get an idea of where the market might be heading. When the price moves above this cloud, it usually suggests that we might see an upward trend. This means that the New Zealand Dollar could increase in value compared to the US dollar.

Traders are expecting that the price will test the upper boundary of this cloud, which is currently at 0.5995. If it passes this test, it could rise further to 0.6085. Think of this like a climber trying to reach a higher point on a mountain - if they succeed, they can aim for an even higher point.

Another sign that could confirm this upward trend would be if the price bounces back from the lower boundary of what’s known as a ‘bullish channel’. This channel is like a path that upward trends tend to follow.

However, there’s always a chance that things won’t go as expected. If the price breaks through the lower boundary of the Ichimoku Cloud and manages to stay under 0.5965, it would suggest that instead of rising, the New Zealand Dollar might decline in value against the US dollar to possibly around 0.5875. This would be like our climber slipping and falling down the mountain.

So, while current signs point towards an increase in the value of New Zealand Dollar against the US dollar, it’s always important to keep an eye on these key levels as they can indicate potential changes in trend.

GBPUSD

The GBPUSD currency pair, also known as "Cable", is currently around 1.23. It has been trying to get past the 1.2328 level, but it's been tough. This level is important because it's a key point on the chart that traders look at. Despite some not-so-great news about the UK's economy, the pound is still doing okay. The US dollar might get weaker because the US Federal Reserve (the Fed) is being careful with its money policies due to global economic issues and uncertainty. This could help the pound.

Later today, we'll get some data about US inflation (how much prices are rising). If inflation is as expected or lower, it could make the US dollar weaker and help the pound.

On the chart, things are looking up for the pound. However, there are some signs that it might be tough for the pound to keep going up. If the pound can get past 1.2328, it could keep going up. If it can't, it might start going down. Here are some key levels to watch:

Resistance: 1.2328 - 1.2386 - 1.2418 - 1.2443
Support: 1.2276 - 1.2240 - 1.2207 - 1.2187

CPI: Not the most welcome outcome

Recent inflation reports have exceeded expectations, potentially offsetting the cautious tone from Federal Reserve officials. However, the focus seems to be on the duration of current interest rates rather than their height. Thus, a slightly higher inflation rate may not significantly disrupt the market.

The "Fed rhetoric shift" is becoming evident, with Christopher Waller's comments suggesting that the rise in yields could substitute for a rate hike. This indicates a possible shift towards a more dovish monetary policy.

The future hinges on economic indicators. Unless inflation rises unexpectedly or labor market imbalances lead to a wage-price spiral, the Fed may maintain a less hawkish stance. This could boost demand for longer-duration assets and foster a "Santa rally".

The market's reaction to today's CPI print is uncertain, but it may not be what investors were hoping for.

XAUUSD

Gold prices are looking to increase as we move into early European trading hours. With a rise of over 2.4 percent, the gold to US dollar rate (XAUUSD) is on track for its best week since mid-March. This comes as recent comments from the Federal Reserve have been increasingly cautious.

If we look at the daily chart, the first level of resistance seems to be at 1884.89, a key point from August. Resistance levels are prices at which sellers are expected to enter the market in sufficient numbers to take control from buyers.

Just above that, gold will encounter the 50- and 200-day moving averages. A moving average is a commonly used indicator in technical analysis that helps smooth out price action by filtering out the “noise” from random short-term price fluctuations.

There was a bearish crossover in September, which suggested a general downward trend. A bearish crossover occurs when a short-term moving average crosses below a long-term moving average, signaling potential downward price movement.

So, XAUUSD is facing important resistance levels as we approach the weekend. If prices start to fall, the midpoint of the Fibonacci retracement level is at 1848.37, followed by the 1804.78 – 1815.30 point. Fibonacci retracement levels are horizontal lines that indicate where support and resistance are likely to occur. They are based on Fibonacci numbers, each level is associated with a percentage, showing how much of a prior move the price has retraced.

Frax's New Product sFRAX: A Game Changer in Decentralized Finance

Frax, a decentralized finance protocol, has introduced a new product called sFRAX. This product allows holders of Frax's stablecoin, FRAX, to earn interest at a rate similar to the U.S. Federal Reserve's interest rate on reserve balances, which is currently around 5.4%. The product started with an annual percentage yield (APY) of 10%, but it will eventually match the Federal Reserve's rate.

Since its launch, over 150 users have invested more than $35 million in sFRAX. This has caused the price of Frax's governance token, FXS, to increase by 7% to $5.66, although it has since dropped slightly to $5.49.

Meanwhile, lending protocol MakerDAO has been successful in attracting interest in the U.S., investing over $2 billion in short-term bonds since February 2022 and offering a 5% savings rate on its own stablecoin, DAI. This has led to a significant increase in the value of its token, MKR, which has risen by over 168% this year.

In comparison, FXS has only increased by 32% this year. However, some people in the crypto community believe that FXS will soon catch up with MKR.