DXY Faces Potential Volatility as GDP Data Release Looms

Forex

Traders' Opinions

Summary:

The DXY is poised for potential volatility as the market awaits the GDP data release on Thursday. The two potential outcomes will determine the direction of the market movement. While the technical analysis suggests a bearish market sentiment, a bullish reversal could also be possible.

SELL USDX

Close Time

CLOSED

101.600

Entry Price

100.800

109.000

100.370 -0.210 -0.21%

11.8

Pips

Profit

100.800

101.482

Exit Price

101.600

Entry Price

109.000

DXY Faces Potential Volatility as GDP Data Release Looms_1

The DXY, after breaking through a critical support zone, has experienced a retest, accompanied by a 61% Fibonacci retracement. These developments have set the stage for a potentially volatile market movement as investors eagerly anticipate Thursday's GDP data release.

The Two Potential Outcomes

The release of the GDP data on Thursday will be a deciding factor for the direction of the market movement. Two potential outcomes can be anticipated based on the data:

Exceeding Expectations: If the GDP data exceeds expectations, investors may feel more secure, and as a result, the dollar prices may not increase significantly. This outcome could potentially result in a sideways movement for the DXY.

Worse-than-expected: However, a worse-than-expected GDP could trigger fears of a potential recession, leading to a surge in demand for safe-haven assets like gold. This increase in demand could drive up the price of gold and weaken the dollar significantly. In this scenario, we could see a significant drop in the DXY.

The Technical Analysis

From a technical standpoint, the DXY has broken through a critical support zone, which could suggest a bearish market sentiment. However, the retest accompanied by a 61% Fibonacci retracement could also suggest a potential bullish reversal.

TRADE RECOMMENDATION

SELL DXY

ENTRY PRICE : 101.600

STOPLOSS : 109.00

TAKE PROFIT : 100.800

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

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Eva Chen

Forex

Central Bank

Economic

Summary:

Australia's inflation fell from a 33-year high in the first quarter as the cost of living rose at its slowest pace in more than a year; At the same time, core inflation was lower than expected, suggesting that the pressure on the RBA to raise interest rates again was easing.

BUY AUDUSD

EXP

EXPIRED

0.65600

Entry Price

0.68350

0.63500

0.68210 +0.00594 +0.88%

Pips

EXPIRED

0.63500

0.67605

Exit Price

0.65600

Entry Price

0.68350

Fundamentals

The AUDUSD extended the previous day's pressure and came under some selling pressure on Wednesday for the second consecutive trading day. The AUDUSD maintained its quoted tone during the European session and is currently near the threshold of 0.6600 or its lowest level since mid-March.

The AUD weakened across the board after the Australian Bureau of Statistics reported that headline CPI fell from 1.9% to 1.4% in the first quarter, the smallest increase since the end of 2021.

Data released today by the Australian Bureau of Statistics showed that the quarterly CPI rose by 1.4% in the first quarter, slightly higher than the market's expected 1.3%. The annual growth rate slowed to 7.0% from 7.8%, again higher than the expected 6.9%. In March alone, CPI rose 6.3% from a year earlier, down from 6.8% in February.

A closely watched core inflation measure, the revised average, rose 1.2% in the March quarter, pushing annual inflation down to 6.6%, below expectations of 6.7%.

The key conclusion to be drawn from these positive data is that they appear to reinforce the RBA's expectation of another pause in interest rate hikes at its May 2 meeting. The likelihood of a pause has risen from 83% before the inflation report to 100% today. It is certain that inflation has peaked, although the cautious RBA is unlikely to use the word "p" at the moment.

Meanwhile, it is too early to declare a complete victory in the fight against inflation, with headline inflation and core interest rates still more than three times the RBA's 2-3% target range. Although the market is confident of another pause in interest rate hikes, the market believes that the RBA is still worried that if the policy is not tightened further, an excessively high core interest rate may fuel a price-wage spiral.

As the banking crisis returned to the headlines, the AUDUSD remained under pressure.

Shares in the First Republic Bank fell 50% after its earnings report showed deposits plunged 40% in the first quarter. As the future existence of the First Republic Bank is threatened, the risk mood has dropped. If the panic in the banking sector worsens, the USD may rise and continue to push down the AUD.

AUDUSD: Stop-Loss Orders Are about to Be Triggered. Will the Trend Reversal Start Here?_1

Technical Analysis

After peaking at 0.7157 in early February, the AUDUSD has been falling in a downward-sloping channel. Although the AUDUSD has successfully broken through this bearish pattern, there has been no direction since then. Bears have recently completed the death cross between their 50-day and 200-day SMAs, triggering continued bearish pressure.

Short-term oscillators continue to tilt downward. The RSI is below its 50 neutral range, while the MACD diverges below the 0-axis and there is no convergence signal, which means that the downward space continues.

Nevertheless, we believe that short positions may have a short break after they reach point D.

If prices move upwards, the recent resistance level of 0.6746 is very close to the 200-day SMA, which may be the first hurdle for bulls to overcome. After breaking this range, the AUDUSD could rise to an April high of 0.6805 before testing 0.6920. If it fails to stop here, the price may encounter strong resistance at 0.7030.

Or, if bears try to keep prices low, 06550 could be the first line of defense. Below that bottom, prices could challenge last November's low of 0.6360 before turning to 0.6250. A break below the latter could lay the foundation for the bottom 0.6169 in 2022.

Overall, the AUDUSD seems to continue to maintain a neutral downward tone, and the technical indicators failed to provide a bullish signal. To regain confidence, bulls need to reverse the signal of the death cross divergence in their 50-day and 200-day SMAs. However, judging from the logic of the trading game, the stop-loss orders are imminent (triggering a price reversal after the stop-loss) and this is also the last attempt before the price slides to the bottom. It is recommended to buy at the lows.

Trading Recommendations

Trading direction: Long

Entry price: 0.6560

Target price: 0.6835

Stop loss: 0.6350

Deadline: 2023-05-10 23:55:00

Support: 0.6567, 0.6427, 0.6386

Resistance: 0.6620, 0.6705, 0.6793

Risk Warnings and Disclaimers

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Eva Chen

Cryptocurrency

Central Bank

Economic

Summary:

Bitcoin prices traded above US$28,500 after plunging 10% this week. After the recent banking crisis, bitcoin prices pulled out of the stock market and rebounded at the end of the first quarter. Now, with the decline of the First Republic Bank and how it could trigger another crisis, the likelihood of similar events is growing. Bitcoin prices rose accordingly.

BUY BTC-USDT

Close Time

CLOSED

28500.0

Entry Price

37150.0

25000.0

62451.9 +3021.9 +5.08%

776.9

Pips

Profit

25000.0

29276.9

Exit Price

28500.0

Entry Price

37150.0

Fundamentals

Bitcoin's intraday rebound benefited from the decline of First Republic Bank, whose stock, FRC, has plunged nearly 50% in the past 24 hours. The overall decline since early March was 93.32%. At the close, the FRC was trading at US$8.10.

One of the biggest reasons for the FRC crash was reports that it was facing a US$ 100bn outflow of deposits. According to Monday's announcement, the drop in inflows surprised everyone as their deposits fell by 40% in the first quarter of this year.

To add insult to injury, there are numerous reports that the U.S. government would take over the FRC.

According to a Fox reporter's tweet by Charles Gasparino, bankers working with the FRC expect the government to eventually take over this troubled bank.

However, this will only happen after it has exhausted all private sector solutions, such as selling assets and finding buyers. This seems very difficult. Officials at the big banks believe the Federal Reserve was preparing to take over the FRC last week, just before its earnings announcement depressed share prices.

Although most other U.S. banking stocks remain strong now, investors may have begun to weigh the possibility of another banking crisis, according to results released one after another. This is reflected in the Federal Reserve's next rate hike forecast next week. In the past 24 hours, the probability of a 25-basis-point rise has fallen from 90.5% to 76.6%.

Interestingly, the U.S. Dollar Index has not been adversely affected by the bank stock crash, which is a good sign given that confidence in the currency is weakening. However, the stock market did suffer. Major U.S. stock indexes closed Tuesday off their intraday lows. The Dow Jones index fell 1.0%, the Nasdaq index fell 2.0%, and the Standard & Poor's index fell 1.6%.

However, the impact of these positive developments is reflected in the bitcoin price; As of posting the article, the price of bitcoin has risen nearly 6% to US$29,142. After plunging 10% in the past few trading days, investors expect bitcoin prices to adjust longer before the recovery begins, but the collapse of FRC rekindled the "safe haven" narrative.

In addition, Indonesia's support for cryptocurrencies in promoting trade diversification has also played a role in fueling the situation.

Perry Warjiyo, governor of Bank Indonesia, announced that Jakarta is following in the footsteps of the BRICS group, reducing its dependence on the US dollar and promoting the diversification of currency used in international trade.

Indonesia is "more specific" than the BRICS countries because they have implemented currency diversification methods with Thailand, Malaysia, China, and Japan.

As the U.S. continues to weaponize the USD, other countries are looking for alternatives. It seems likely that the USD will soon have to share the dividends of "currency use rights" with other currencies. The search for alternatives will have a positive impact on the encrypted money market as investors hope to profit from it ahead of time.

BTCUSD: Banking Crisis Continues to Develop While Encrypted Assets Regain Market Favor_1

Technical Analysis

Bitcoin is on the rise after days of consolidation in key demand areas. As long as bitcoin prices remain above the March 26 low of US$27,329, the upward trend will remain unchanged.

As can be seen from the 4-hour timeframe, the correction in prices, which started at a high of US$31,000 on April 14th, is likely to have been completed. As a result, bitcoin prices are likely to start the next rally, which will be a continuation of the bullish trend in a higher timeframe.

Based on the current price trend, bitcoin is likely to continue its bullish trend to the first resistance level of 30350.

The first support level is at 27205, which is an overlapping support level. If the bullish trend continues, this level of support is expected to remain unchanged. However, if the price falls below this level, the next level of support is at 26508, which is also overlapping support, which is consistent with the 38.20% Fibonacci retracement. It is recommended to buy at the lows.

Trading Recommendations

Trading direction: Long

Entry price: 28500

Target price: 37150

Stop loss: 25000

Deadline: 2023-05-10 23:55:00

Support: 28383, 27329, 26550

Resistance: 29187, 30350, 37150

Risk Warnings and Disclaimers

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King Ten

Commodity

Summary:

Gold prices have the potential to move higher on Thursday's U.S. data.

BUY XAUUSD

Close Time

CLOSED

1980.00

Entry Price

2015.00

1959.00

2586.18 +27.04 +1.06%

69.9

Pips

Profit

1959.00

1986.99

Exit Price

1980.00

Entry Price

2015.00

Fundamentals

On Wednesday (April 26) in Asian hours, spot gold fluctuated to the upside and briefly traded above the 2000 mark today. Overnight market concerns about the banking sector rebounded and the U.S. debt ceiling crisis worries intensified. U.S. stocks plunged and U.S. bond yields recorded the largest one-day decline since March, which provided support for gold prices. However, risk aversion fell back slightly in Asian hours. Gold prices are still suppressed by the 2000 mark resistance, maintaining the recent volatile pattern.

U.S. Treasury Secretary Yellen warned that if Congress fails to raise the government debt ceiling, the resulting default will trigger an economic disaster and lead to rising interest rates in the coming years. Bipartisan consensus on the U.S. government debt ceiling has not been reached and the market also began to expect the risk of increased U.S. debt default may trigger a serious recession. On the other hand, the banking system risk may not be over yet. The First Republic Bank earnings report further intensified concerns about deposit outflows, asset-liability mismatches and the risk of a credit crunch. Funds have moved to safer money fund markets with the fearing of liquidity risks. The Financial Times reported on Tuesday that even the White House is increasingly concerned about First Republic Bank's ability to stay out of bankruptcy. Due to these factors, gold prices' short-term main line is still to go long at lows.

This week still needs to pay attention to the quarterly GDP data released on Thursday and the core personal consumption expenditure (PCE) price index released on Friday. The latter is the Fed's favored inflation indicator. The market is expected to be lower than the previous value. The downside of gold prices may still be limited, or a better trading opportunity. On the market, short-term bearish signals for gold are diminishing and the volatility is narrowing. You need to be alert to gold prices or their possibility of going higher with fluctuation.

Today's trading reference range is 1980-2005.

Technical Analysis

In the daily chart, short-term moving averages are more disorderly and intertwined. MACD forms a death cross, short-term strengths and weaknesses are not obvious. In the past few trading days, gold prices repeatedly fell below the 1980 mark after a rapid recovery, suggesting that the lower buying support is stronger. The initial above resistance is near 2015 and further resistance is around the line of 2032. It is expected to open a new upward channel if it can break through the resistance.

But at the same time, considering that the top has repeatedly stopped in the region from 2005 to 2015, it is still necessary to guard against the fluctuation of the gold price peak risk. The initial support below is in the 5-day moving average near 1994, then the support is near the 1980 mark, and the strong support is in the last three weeks low near 1969. The short-term space below will also be opened if the support is lost. XAUUSD: Two-way Fluctuations with Oscillation in Search of A Breakout_1

XAUUSD: Two-way Fluctuations with Oscillation in Search of A Breakout_1

Trading Recommendations

Trading direction: long

Entry price: 1980

Target price: 2015

Stop loss: 1959

Support: 1980.000, 1969.000

Resistance: 2015.000, 2032.000

Risk Warnings and Disclaimers

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King Ten

Commodity

Summary:

When OPEC countries start cutting production in May, the oil market will experience a significant supply shortage again.

BUY WTI

Close Time

CLOSED

77.000

Entry Price

83.000

74.500

70.604 +1.544 +2.24%

250.0

Pips

Loss

74.500

74.496

Exit Price

77.000

Entry Price

83.000

Fundamentals

During the Asian session on Wednesday (April 26), crude oil futures fluctuated to the upside. U.S. consumer confidence has fallen to a nine-month low in April, fueling fears of a recession. As First Republic Bank reported a deposit flight of more than $100 billion on Monday, it has stoked fears of a potential banking crisis. Meanwhile, the demand for safe havens has driven the dollar higher as concerns about the global economy deepened. In addition, traders are still worried that European and American banks that are fighting inflation keep raising interest rates, resulting in a slowdown in economic growth. Therefore, energy demand in the US, UK, and EU has been weakened. Due to market concerns about the economy and a stronger dollar, crude oil futures weakened yesterday, ending the two-day rally. Among them, WTI crude oil futures for delivery in June 2023 fell by US$1.69 per barrel to a settlement price of US$77.07 per barrel, which has fallen to a new low of US$76.445 per barrel in the past week.

Overall: The financial environment and demand will suppress oil prices in the short term, with the hawkish attitude of the Federal Reserve and the expectation that the European and American economies will enter a recession in the second half of the year. At the same time, Russian oil exports are still strong. As they have not yet entered the production reduction period, the supply side cannot provide too much support for oil prices. However, with OPEC+ taking effect and more evidence of China's oil demand growth, oil prices will rebound to $84 per barrel and higher in the coming months.

Technical Analysis

From a daily perspective, MACD extended the death cross signal at the high. Oil prices are near the MA5, which are currently suppressed by the MA10 and MA20. Despite the bears having the upper hand, the price is currently around a nearly one-week low. The strong support below is at the gap of 75.7. Without a large substantial impact, it may be difficult to break through. Oil prices remain weak until the MA10 of 79.3 is broken. Initial support is around the intraweek low of 76.5, with further support near the March 31 high of 75.7. If the breakthrough is smooth, the short-term bearish signal will be strong, and the next strong resistance will look at the 72.5 line. WTI: Crude Oil Has Stopped Falling and Rebounded, but the Strength Is Not Satisfactory_1

WTI: Crude Oil Has Stopped Falling and Rebounded, but the Strength Is Not Satisfactory_1

Trading Recommendations

Trading Direction: Long

Entry Price: 77.000

Target Price: 83.000

Stop Loss: 74.500

Support: 75.700/72.500

Resistance: 80.000/83.300

Risk Warnings and Disclaimers

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Warren Takunda

Traders' Opinions

Summary:

Cardano (ADA) may be on the brink of a bullish breakout, as indicated by both technical analysis and strong fundamentals. The asset has tapped into an order block, indicating a possible reversal to the upside. Additionally, the transition of the Snowmantastic NFT project to Cardano and increasing accumulation of ADA on the network are bullish signs supporting the ADA uptrend.

BUY ADA-USDT

Close Time

CLOSED

0.4000

Entry Price

0.5000

0.3500

0.3487 +0.0203 +6.18%

389.7

Pips

Loss

0.3500

0.3610

Exit Price

0.4000

Entry Price

0.5000

Cardano (ADA) Potential Bullish Breakout: Technicals and Fundamentals_1

Cardano (ADA) is a blockchain platform that aims to address the scalability and interoperability issues faced by existing blockchain networks. The platform was created by Charles Hoskinson, one of Ethereum's co-founders, to enable developers to build decentralized applications (dApps) and smart contracts. In recent times, the crypto community has shown a keen interest in ADA, but investors and traders are unsure about the cryptocurrency's next move amid the current market uncertainty.

Recent Price Action

In the previous week, Cardano (ADA) has faced substantial bearish movement, leading to a drop in its price by nearly 20%.. This trend can be attributed to various factors, including the ongoing downtrend in the market. However, despite the bearish trend, the price chart of ADA indicates that it may be poised for a bullish breakout.

Possible Bullish Breakout

The 1-day timeframe chart of Cardano shows that the asset has just tapped into an order block at the $0.37 region, indicating a likely reversal to the upside. An order block is a price level where a large number of buy or sell orders are clustered, creating a significant level of support or resistance.An order block is formed when significant market participants such as large institutional traders, hedge funds, or other traders place substantial buy or sell orders at a particular price level.

While the timing of ADA's reversal is uncertain, it may happen soon based on the precision shown on the chart. Currently, ADA bears seem to be exhausted as the asset has only decreased by 0.2% in the last 24 hours . ADA is currently trading at $0.40, slightly above thesupport level.

Fundamentals That Could Contribute To ADA's Breakout

In addition to technical analysis, Cardano also possesses strong fundamentals that may play a role in a potential bullish breakout.. The Snowmantastic NFT project has recently moved from the Ethereum network to the Cardano network, attracting a significant number of investors into this ecosystem, thereby increasing the native token's price in the long run.

On the Cardano network, large ADA transactions are on the rise, indicating that institutional players and whales are making moves on the network, according to popular crypto analyst, Ali Chart. This is a positive indication that supports an upward trend for ADA.

TRADE RECOMMENDATION

BUY ADA

ENTRY PRICE : 0.40

STOPLOSS : 0.35

TAKE PROFIT : 0.50

Risk Warnings and Disclaimers

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Eva Chen

Forex

Central Bank

Economic

Summary:

The GBPUSD came under bearish pressure again on Tuesday, falling to 1.2400. Disappointing U.S. consumer confidence data led to depressed market sentiment, boosting the USD and putting the GBPUSD on the defensive.

BUY GBPUSD

Close Time

CLOSED

1.24009

Entry Price

1.26660

1.22700

1.32914 +0.00799 +0.60%

72.3

Pips

Profit

1.22700

1.24732

Exit Price

1.24009

Entry Price

1.26660

Fundamentals

The GBPUSD showed a strong upward trend after regaining its psychological resistance level of 1.2500 in the Asian session. However, the USD's bottoming out has weakened the GBPUSD's performance; By the end of the New York session, the GBPUSD had returned to the threshold of 1.2400 as investors expected the Fed to end its quantitative tightening program after raising interest rates by 25 basis points in May. (Positive for USD)

Meanwhile, U.S. consumer confidence has fallen this month to its lowest level since last July because of more pessimistic views on the economic outlook.

The data released on Tuesday showed that consumer confidence from the U.S. Conference Board dropped from 104 in March to 101.3 in April, with an expected median of 104. Consumer expectations fell to 68.1, the lowest level since last July. However, the Consumer Status Index rose to 151.1.

Futures on the S&P 500 index edged lower in Asia after a modest rally on Monday, indicating a decline in investors' risk appetite.

This week, 500 U.S. stocks are expected to fluctuate sharply as big technology companies report results for the first quarter of fiscal year 2023. Meta Platforms, Google, and Microsoft will announce their quarterly results and revenue guidance, which will put investors on tenterhooks.

This week, the U.S. Dollar Index is expected to remain active ahead of preliminary gross domestic product (GDP) data due on Thursday. Annualized GDP is expected to contract to 2.0% in the first quarter, compared with the previous forecast of 2.6%. The drop in GDP data will exacerbate fears of a slowdown in the U.S. economy. It could also force the Fed to take a stable stance on interest rate guidance.

On the UK side, UK factory orders contracted again in April, with monthly data flat from March, hitting a more than two-year low. The good news is that corporate optimism improved from -5 to -2 in the quarter, although it is still in the negative region, at least it is the highest level since October 2021.

The chances of the Bank of England adopting a hawkish monetary policy are on the rise because inflation in the UK seems to be struggling to stay in double digits amid labor shortages and soaring food inflation. UK's food inflation rate has soared to a 45-year high of 19.1% and has yet to show signs of softening. BOE governor Bailey may seek a further 25 basis points to 4.5%.

GBPUSD: Be Cautious When Staying Bullish, as Bulls Return to the Critical Point Again_1

Technical Analysis

After a week of consolidation, the GBPUSD successfully closed above the December-January cap of 1.2445 on Monday, bringing the market's focus once again to a higher high. However, it did not last long. The strong rebound of the USD put the GBPUSD on the defensive again.

Nevertheless, RSI and MACD have yet to correct their negative momentum. As prices regain their footing near their 20-day SMA and the lower edge of the seven-week bullish channel, it still seems likely that they will continue to move higher.

This means that bulls need to test again and break the 1.2500 level before they can reach the peak of 1.2665 from April to May 2022.

If the price reverses, the closing price below the threshold of 1.2400 will raise doubts about the continuation of the bullish.

Overall, it should be cautious when staying bullish toward the GBPUSD in the near term. A further upward trend can only be recognized if it is firmly closed above 1.2520. It is recommended to go long at the lows.

Trading Recommendations

Trading direction: Long

Entry price: 1.2400

Target price: 1.2666

Stop loss: 1.2270

Deadline: 2023-05-09 23:55:00

Support: 1.2377, 1.2345, 1.2274

Resistance: 1.2471, 1.2546, 1.2666

Risk Warnings and Disclaimers

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DXY Faces Potential Volatility as GDP Data Release Looms

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TRADE RECOMMENDATION

Stop-Loss Orders Are about to Be Triggered. Will the Trend Reversal Start Here?

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Technical Analysis

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BTCUSD: Banking Crisis Continues to Develop While Encrypted Assets Regain Market Favor

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Technical Analysis

Trading Recommendations

Two-way Fluctuations with Oscillation in Search of A Breakout

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Crude Oil Has Stopped Falling and Rebounded, but the Strength Is Not Satisfactory

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Cardano (ADA) Potential Bullish Breakout: Technicals and Fundamentals

Recent Price Action

Possible Bullish Breakout

Fundamentals That Could Contribute To ADA's Breakout

TRADE RECOMMENDATION

Be Cautious When Staying Bullish, as Bulls Return to the Critical Point Again

Fundamentals

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Trading Recommendations

Risk Disclosure