Forex Signals Brief for August 3: Will US Services Head Into A Recession?

Yesterday’s Market Wrap

Yesterday the Reserve Bank of Australia (RBA) delivered the third 50 rate hike in a row, taking rates from 1.35% to 1.85%, which should have been a bullish event for the AUD. But, they softened the rhetoric in their press statement, as they said that the future path of their policy (meaning rate hikes) will not be set in stone, so it will be dependent on the economic data. That economic data keeps deteriorating worldwide, which means that the RBA will soften the rate hike path.

The US JOLTS job openings missed expectations in the afternoon, although the sentiment was determined by the tensions between China and the US, as Pelosi headed to Taiwan, which is an independent country of around 23 million and produces more than 50% of the world’s microchips that are critical to the functioning of mobile phones, consumer electronics, cars, military equipment and more. Risk sentiment turned negative, which benefited the USD.

The Data Agenda Today

Today started with the employment report from New Zealand, followed by the Australian retail sales and the Swiss CPI (consumer price index) inflation, which posted a small decline in July and gave a positive sign for other countries. The Eurozone retail sales for June are expected to fall flat, while the US ISM services are expected to slow down later in the afternoon. Today is the OPEC/JMMC meeting as well, which has been the reason for Oil being anxious and volatile yesterday.

Yesterday we didn’t start the day well, as the sudden jump in Gold above the resistance gave us a losing signal. But, we made up with other forex signals, as well as trading the range in Oil, as it bounced up and down ahead of the OPEC meeting today.

WTI Oil Sell Signal

Crude Oil stopped declining at around $92.50 on Monday after a $10 crash and for a few sessions it traded between that support area and the resistance zone around $94.50. We decided to open a sell signals below the resistance area as the price was reversing lower and booked profit as Oil fell to the 100 SMA (green) on the 15 minute chart.

US crude Oil – 15 minute chart

GOLD – Sell/Buy Signal

Gold continues to remain bullish as the uncertainty prevails, keeping the sentimnt bullish for XAU. Early in the morning yesterday we opened a sell signal at resistance, which closed in a loss as buyers resumed control and pushed XAU/USD higher to $1,788. The price retreated lower to the moving averages a coupole of time where we decided to open a long term buy signal.

XAU/USD – 15 minute chart

Cryptocurrency Update

Cryptocurrencies continued to remain bearish yesterday as they have entered a retreating phase after the bullish move last week. We opened another crypto signl yesterda, so we have two open crypto signals now and are planning to open a few more as we prepare to buy cryptos long term after this bearish wave comes to an end above the support.

Can the 20 SMA Turn into Support for ETHEREUM?

Ethereum pushed higher by the middle of July after trading in a range above $1,000 for about a month. Buyers pushed above the 50 SMA (yellow) which was the first bullish signal and after the first failure at the $1,700 support and resistance level, ETH/USD pushed above it, as the 20 SMA (gray) turned into support. But the 100 SMA (green0 stopped the climb and in the last several days ETH was retreating lower, although it seems like the 20 SMA is acting as support again, so let’s see how the price will react today.

ETH/USD – Daily chart

 BITCOIN Respecting the Bullish Channel

Bitcoin has been recuperating slowly since it fell below $20,000 in June. Although there was no follow-through lower since then, which indicated that the support zone is holding. BTC has been making higher highs and higher lows since then which is another bullish signal. So a bullish channel hs been forming here, and we are already long on BTC.

BTC/USD – Daily chart