Yesterday’s market wrap
Yesterday started with the New Zealand jobs report, and later RBNZ Governor Orr gave a speech. However, the NZD didn’t care much, as yesterday’s focus was on the Fed’s rate decision and press conference. Services in Europe have shown decent expansion, as spring kicks in and people are dying to have fun after two years of Covid restrictions and lockdowns.
In the US session, the ADP non-farm payrolls move and the services ISM were the last data before the Fed meeting later in the evening. The FED offered a 50 basis point rate hike as expected and Chairman Jerome Powell ruled out a 75 basis point rate hike, although I don’t think they were going to do such a rate hike. The next meeting is in July and expectations are for another 50 basis point rise, but equity markets got excited and made a big comeback, while the USD plunged around 100 pips. Commodity currencies also benefited.
The data agenda today
The day started with Chinese services Caixin, which was interesting to see after the deeper dive into the contraction in the manufacturing and services PMI. Caixin services also fell deeper into contraction, due to coronavirus shutdowns in China, which will negatively impact commodities, hence the decline in commodity dollars.
The OPEC-JMMC meetings shouldn’t be too interesting, as OPEC+ is set to agree on another small increase of 432,000 barrels per day (bpd) for June, as it is expected that the Sanctions are further curbing Russian production to counter concerns about growing demand from the Chinese. blockages.
The most important event today will be the Bank of England meeting. The votes on the MPC’s official bank rates are 8 to 1 in favor of raising interest rates from 0.25% to 1.00%. This will be the fourth consecutive rise, but the GBP did not benefit from it. So it will be interesting to see how the GBP reacts this time.
Forex Signals Update
Yesterday we opened three new forex signals, although it was difficult to choose a side due to the FED meeting later in the evening. Although we ended up with two winning trades and one losing despite the little drama in the markets after Powell’s press conference.
USD/CAD – Sell Signal
This retraced pair has been trading in a range since August of last year, with the high of the range below 1.30. Earlier this week, USD/CAD was showing weakness below this resistance level, and yesterday we decided to open a sell signal on this pair, which closed in profit as the USD fell after the Fed meeting.
USD/CAD – Daily Chart
USD/JPY – Buy Signal
We’ve been a long time USD/JPY on numerous occasions over the past few weeks as bullish momentum has exploded. The moving averages have done a great job as a support indicator and we decided to buy this pair yesterday at the 50 SMA (yellow) on the H4 chart, after the rally back down as the USD declined.
EUR/GBP – 240 min chart
Looking to buy Fantom FTM
FTM/USD was rather bullish until mid-January as it retested previous highs from October last year. But the Wonderland controversy weighed on DeFi coins earlier this year, causing Fantom to join the rest of the crypto market which had been on a downtrend since November.
Then, the departure of key personnel such as Andrew Cronje further weighed on Fantom which broke below $1 and below the support zone around $0.90. But the last support zone above $0.60 seems to have held firm and now Fantom is bouncing higher. We are thinking of buying this cryptocurrency, but would like to see a retest of the support zone.
Support above $0.60 held for FTM/USD
Profiting again on the Terra LUNA trade
We decided to buy the Terra LUNA token as this cryptocurrency has been the most bullish among the majors for many months as it continues to make higher highs until last month. LUNA/USD retreated in January, falling as low as $40, but the 200 SMA (purple) held twice as support and buyers resumed the uptrend.
Luna nearly hit $120 earlier this month but pulled back again, although this time it was the 100 SMA (green) that held as support where we decided to open a buy signal. LUNA/USD started bouncing off this moving average, but the daily 20 SMA (grey) stopped the rebound and now the price is back down to the 100 SMA.