USD/CAD:TOP RESISTANCE | PRICE WILL DROP | SHORT SETUP ⚡️Hello Everyone, I hope you'll Appreciate our Price action Analysis !
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GOLD:PRICE IS FALLING | BEARISH CHANNEL | NEW LONG TRIGGERHello Everyone, I hope you'll Appreciate our Price action Analysis !
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EUR/USD:REVERSAL COMING | NEW LONG SETUP | LONG 🔔Hello Everyone, I hope you'll Appreciate our Price action Analysis !
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Trading Idea - #STABILUSMy trading idea for STABILUS SE - long/buy
Target: 60.00 EUR
Stop: 37.00 EUR
Company profile on STABILUS SE: Stabilus S.A. is a manufacturer of gas springs and hydraulic dampers based in Luxembourg. The company was founded in 1934 and employs over 4,000 people at nine production sites worldwide. Stabilus' best-known product is the Lift-O-Mat. This is used for the most part in tailgates and engine hoods of passenger cars, but also in medical and rehabilitation technology and in maritime applications. Gas springs or dampers from Stabilus are also used in swivel chairs and other furniture.
JPMorgan as a driver of Stabilus. It is not unusual for major investment houses to influence the share price of individual companies with their forecasts and analyses. On January 05, 2022, Stabilus was downgraded by JPMorgen. The earnings expectations were significantly below expectations. Consequently, the share price slid by almost 40%. Almost half a year later, the tide turns. Stabilus exceeds profit expectations and JPMorgan analysts rate the share price higher with a target of EUR 62.00.
After strong sales growth in Q2 - 2022, the company has set the corporate target far high, possibly without the calculation of rising prices for raw materials, which can only be partially passed on to customers. Nevertheless, the company is well positioned as strong automotive business in Asia powers Stabilus.
Sales Q2- 2022: With 15% more than last year, the Group achieved record quarterly sales of approximately 281 million euros. In the company's history, this is the highest revenue so far.
Looking at the chart, the share price has successfully bounced off the EUR 40 .00 support line.
Overall, there should be more bullishness for Stabilus.
USD/CAD:RESISTANCE AREA | PRICE MAY REVERSE | SHORT IDEA 🔔Hello Everyone, I hope you'll Appreciate our Price action Analysis !
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EUR/USD:NEWS OUTLOOK + NEXT TARGETS | LONG SETUP 🔔EUR/USD, US DOLLAR ANALYSIS AND NEWS:
Hot Core Inflation Keeps a July Hike in Play
Month End Flows Unwinding as Euro Recovers
EU DATA RECAP: VERY STRONG CORE INFLATION
Euro Zone flash estimate of inflation rose 7.5% Y/Y, matching consensus. However, the core figure printed notably above expectations at 3.5% compared to the 3.2% expected. As such, this will further fuel expectations that the ECB will begin to raise interest rates from July, where current market pricing is near fully priced in for lift-off. Meanwhile, Euro Zone Q1 GDP came in line at 5% Y/Y with a slightly softer than expected quarterly figure 0.2% vs 0.3% expected. That said, this is unlikely to deter the ECB from stepping up its plan to normalise monetary policy.
Market reaction to the data has been muted given that the figures are unlikely to notably move the needle for the near term outlook for ECB policy. Keep in mind that the bigger focus has been on Fed policy with markets positioning themselves ahead of next week’s meeting.
MODEST USD RETRACEMENT AS MONTH END FLOWS FIZZLE
Elsewhere, as we approach the turn of the month, market participants look to be using this as an opportunity to fade the recent aggressive moves in the US Dollar. A reminder that in months where the US equities (SPX) fall at least 3% or more, the US Dollar tends to rise into month end before retracing the move in the first week of the new month. This is shown in the graph below. That being said, while most can agree that the USD is overbought, the issue has been the lack of alternatives with the greenback’s major counterpart (EUR) offer little to no reasons to be bullish. However, the currency I would watch is the Chinese Yuan, where a turnaround could suggest a possible USD peak.
EXPLAINER OF FX MONTH END REBALANCING
London WMR Fix (1600 London Time): The WMR Fix is one of the most widely used benchmarks for FX trading, taking place every day within a 5-minute window around 1600 London time. The fix provides a standard set of currency benchmark rates so that equity and bond investors can compare portfolio valuations and performance with each other.
The WMR fix tends to coincide with a sharp rise in trading volume, prompting a sizeable increase in liquidity. Occasionally, this allows for large real money flows to take place without causing too many distortions. However, flows can also be dominant in one direction (strong buying or strong selling) leading to outsized moves in a very short period of time.
The largest bout of volatility stems from the month-end fix, taking place on the last business day, where market extreme moves can often occur in the lead up during 15:00-16:00 London Time. These FX flows are derived from mostly equity rebalancing.
As such, if a UK portfolio manager holds US Dollar-denominated assets and seeks to hedge FX risk, then a monthly rise in the value of those assets will lead to more dollar hedging (selling the dollar). For example, if equities are FX hedged and US stocks (S&P 500) have risen on the month, while the FTSE 100 (UK stock market) has traded flat, then UK based investors would sell US Dollars against the Pound to add to their hedge, leading to an appreciation in GBP/USD. The greater the outperformance of US equity market over the UK would be associated with greater selling of the USD against GBP, prompting GBP to rise even higher. Although, extreme moves can often partially revert in the day following the month-end fix. That said, the occurrence of such event in a market as liquid as FX, suggests that the London fix (month-end fix in particular) is important for FX traders to watch for.
USD/JPY:REVERSAL ON BULLISH CHANNEL | PRICE READY TO DROP!Hello Everyone, I hope you'll Appreciate our Price action Analysis !
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GOLD : PRICE REBOUND ON SUPPORT AREA | READY TO GROW !Hello Everyone, I hope you'll Appreciate our Price action Analysis !
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GBP/NZD:UPTREND BULLISH CHANNEL | PRICE IS GROWING | LONG Hello Everyone, I hope you'll Appreciate our Price action Analysis !
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AUD/CHF : RETEST PREVIOUS AREA | SHORT SETUP | SHORT ⭐️Hello Everyone, I hope you'll Appreciate our Price action Analysis !
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EUR/JPY:UPTREND PRICE ACTION LONG SCENARIO | LONG Hello Everyone, I hope you'll Appreciate our Price action Analysis !
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EUR/CAD:PRICE ACTION | PRICE IS FALLING AFTER TOP/DIV. SHORTHello Everyone, I hope you'll Appreciate our Price action Analysis !
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EUR/USD:TECHNICAL ANALYSIS | REVESAL ON DIVERGENCE | LONG ⭐️Hello Everyone, I hope you'll Appreciate our Price action Analysis !
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EUR/USD:FUNDAMENTAL+TECHNICAL ANALYSIS | REVERSAL| LONG 🔔 EUR/USD drops to fresh 5-year lows in the sub-1.0600 area
EUR/USD extends the leg lower to the area below 1.0600.
The greenback trades in cycle peaks, US yields regain composure.
Germany GfK Consumer Confidence deteriorated in May.
Sellers remain well in control of the sentiment around the single currency and drag EUR/USD to the 1.0590/85 band, or new 5-year lows, on Wednesday.
EUR/USD weaker on USD-strength, geopolitics
EUR/USD loses ground for the fifth session in a row midweek amidst the continuation of the strong march north in the dollar and persistent geopolitical concerns, particularly around the potential EU embargo on Russian oil.
In the German debt markets, the 10y bund yields hover around 0.80% amidst the renewed multi-session weakness, whereas US yields regain some upside traction following the recent corrective leg.
In the domestic calendar, Germany Consumer Confidence tracked by GfK worsened to -26.5 for the month of May. Later on Wednesday, ECB’s Lagarde is also due to speak.
In the US docket, weekly Mortgage Applications come in the first turn seconded by Trade Balance figures and Pending Home Sales.
What to look for around EUR
EUR/USD’s price action shows further deterioration and revisits the sub-1.0600 area for the first time since April 2017. The outlook for the pair still remains tilted towards the bearish side, always in response to dollar dynamics, geopolitical concerns and the Fed-ECB divergence. Occasional pockets of strength in the single currency, in the meantime, should appear reinforced by speculation the ECB could raise rates at some point around June/July, while higher German yields, elevated inflation and a decent pace of the economic recovery in the region are also supportive of an improvement in the mood around the euro.
Key events in the euro area this week: Germany GfK Consumer Confidence (Wednesday) – ECB 2021 Annual Report, Consumer Confidence, Economic Sentiment, Germany Flash Inflation Rate (Thursday) – Germany, EMU Flash Q1 GDP Growth Rate, EMU Flash Inflation Rate (Friday).
Eminent issues on the back boiler: Asymmetric economic recovery post-pandemic in the euro area. Speculation of ECB tightening/tapering later in the year. Second round of the presidential elections in France (April 24). Impact on the region’s economic growth prospects of the war in Ukraine.
GOLD:PRICE ACTION ON DEMAND AREA | DIVERGENCE | PRICE WILL GROW!Gold: Consolidation at the current level or a move below the $1890 support level?
Looking at XAUUSD Chart, we can see it was trading relatively steadily in the $1950 range at the on the 21st of April, until the breakdown from its support level of $1932 on the 23rd of April, falling well into the $1900 range and finding new support at the $1890. It was last found trading at the $1897 range just above the $1890 closest support level and has the closest temporary overhead resistance around the $1910 level.
Today we can expect consolidation at the current level or move below the $1890 support level.
However, if it manages to hold above the current level, then a move towards the $1910 the closest resistance level of $1910 can be expected.
ETH/BTC : PRICE READY TO GROW AFTER REBOUND | LONG SETUP Hello Everyone, I hope you'll Appreciate our Price action Analysis !
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GBP/AUD:DOWNTREND | PRICE ACTION | SHORT SETUP⭐️Hello Everyone, I hope you'll Appreciate our Price action Analysis !
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AUD/CHF: PRICE ACTION | RETEST PATTERN AND SHORT SETUP ⭐️Hello Everyone, I hope you'll Appreciate our Price action Analysis !
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EUR/CAD:PRICE ACTION | PRICE IS FALLING AFTER TOP/DIV. SHORTHello Everyone, I hope you'll Appreciate our Price action Analysis !
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EUR/USD:TECHNICAL ANALYSIS | REVERSAL SETUP | LONG ⭐️Hello Everyone, I hope you'll Appreciate our Price action Analysis !
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GOLD:FUNDAMENTALS + TECHNICAL ANALYSIS | SHORT TERM TRADE 🔔Gold Price Forecast: XAU/USD bears have the upper hand, focus on yields/Fed’s Powell
Gold struggled to capitalize on the previous day’s goodish recovery move from over a one-week low.
Aggressive Fed rate hike bets revived the USD demand and acted as a headwind for the commodity.
The Ukraine crisis and inflation fears could help limit losses ahead of Fed Chair Powell’s appearance.
Gold stalled this week's corrective pullback from the vicinity of the $2,000 psychological mark and attracted some buying near the $1,939 area on Wednesday. Retreating US Treasury bond yields prompted some USD profit-taking following the recent runup to the highest level since March 2020, which, in turn, benefitted the dollar-denominated commodity. Apart from this, concerns around the Russia-Ukraine conflict and rising inflationary pressures further boosted the metal's appeal as a hedge against rising costs. That said, hawkish Fed expectations acted as a tailwind for the US bond yields and the buck, which, in turn, capped the non-yielding yellow metal, instead attracted some selling during the Asian session on Thursday.
The markets seem convinced that the Fed would tighten its monetary policy at a faster pace to curb soaring inflation and have been pricing in multiple 50 bps rate hikes. The bets were reinforced by comments by a slew of influential FOMC members since the beginning of this week. St. Louis President James Bullard said on Monday that the US central bank shouldn’t rule out rate increases of 75 bps. Moreover, Chicago Fed President Charles Evans said on Tuesday that he is "comfortable" with a round of rate hikes this year that includes two 50 bps increases. Adding to this, Minneapolis Fed President Neel Kashkari - one of the more dovish FOMC members - noted that policymakers will need to take even more aggressive action to bring down inflation.
Hence, the market focus will remain glued to Fed Chair Jerome Powell's speech at an International Monetary Fund event later during the US session. In the meantime, traders will take cues from the US economic docket, featuring the release of the Philly Fed Manufacturing Index and the usual Weekly Initial Jobless Claims later. This, along with the US bond yields, will influence the USD price dynamics and provide some impetus to the XAU/USD. Apart from this, fresh developments surrounding the Russia-Ukraine saga should contribute to producing short-term trading opportunities around gold.
Technical outlook
From a technical perspective, the overnight bounce faltered near an ascending trend-channel support breakpoint, now turned resistance. This comes on the back of the recent failure just ahead of the critical $2,000 level and favours bearish traders. A convincing break below the $1,940-$1.935 region will reaffirm the negative bias and make gold vulnerable. Spot prices could then turn vulnerable to accelerate the fall towards the $1,916 intermediate support before eventually dropping to sub- $1,900 levels or March swing lows. Some follow-through selling would mark a fresh bearish breakdown and pave the way for a further near-term depreciating move.
On the flip side, the aforementioned $1,960 support-turned-resistance coincides with the 38.2% Fibonacci retracement level of the $2,070-$1,890 downfall and should act as a pivotal point. Sustained strength beyond has the potential to lift the XAU/USD towards the 50% Fibo. level, around the $1,980-$1,982 region. The upward trajectory could further get extended and allow bulls to make a fresh attempt to reclaim the $2,000 round figure. The latter marks a confluence region comprising the 61.8% Fibo. level and the top end of the ascending channel, which if cleared decisively will shift the bias in favour of bullish traders.