- Forex and U.S. stock index all traded in a volatile environment at the new start of the week, with Nasdaq index making some gains
- With no major economic data, markets may carry on consolidation during the most part of Asian and London session. Keep an eye on a break-out possibility after the end of the consolidation.
- We will get monthly energy report by EIA at tomorrow 0:00 BJT (GMT 16:00）and which could have impacts on crude oil.
With no major economic data, currencies traded in a choppy session yesterday and U.S. dollar ended with a Doji on a daily closing basis, indicating Dollar bulls and bears were generally balanced. We heard from FED that U.S. household spending expanded in a faster than expected pace and 3-year inflation expectations significantly increased. However, we were not convinced by those comments and have to wait for confirmations on Friday. As to precious metals, we saw gold and silver recovered intra-day lost ground. Having said that, precious metals still faces ascending trendline resistance on its 4 hour chart.
The Dollar maintained choppy bias. With very limited upside room, its short-term moving averages moved close to and hit its long-term moving averages which remained bearish and diverging. Wait and see if the Dollar will maintain its short term volatile bias with the upside level to watch resting at H4-period EMA60 while the downside support standing at 95.66.
（DXY H4 chart）
Regarding to non-U.S. currencies, Europe’s single currency had consolidated for the two successive trading sessions. With momentum slope flattened as euro’s short-term moving averages moved towards its long-term moving averages, watch if price action of euro could take place breakouts. The downside support level to watch continues to be an ascending trendline on its 4 hour chart. The sterling repeatedly went up and down yesterday to hit H4-period EMA169 support and watch if it could hold above it. The commodity currency Australian dollar’s rallies carried on early this morning after slipped yesterday and may move up towards its last Friday highs.
（GBPUSD H4 chart）
As to precious metals, gold staged pull-back early this morning after rebounded yesterday in a choppy London and New York session, and before that, it slipped in Asian trading. Its short-term moving averages moved into its long-term averages, pointing higher and in the state of diverging. However, the former moved down towards each other once again after being held below the latter. Watch and see if the gold would create a lower low or form “double bottom” configuration during London session.
（Gold H1 chart）
By JasonZou —— Chief Analyst of AvaTrade China
Disclaimer: The views and opinions expressed in this article are those of the authors and for the purpose of reference only, and shall not be relied upon by investors in making any trading decisions.