The NZD/USD is trading near short term lows in the wake of the Reserve Bank of New Zealand delivering an expected interest rate hike.

The NZD/USD stumbled lower in the past two days as the Reserve Bank of New Zealand was expected to raise their interest rate by another 0.50% earlier this morning.  Intriguingly while the NZD/USD currency pair is trading within sight of short term lower values, the technical trend has actually incrementally ticked upwards the past twelve hours. The upwards movement started to occur before the central bank actually raised their borrowing costs.

The interest rate hike from New Zealand’s central bank was widely anticipated and now that result is official, it appears the NZD/USD can be expected to potentially retrace higher ratios it has recently seen which were higher. On the 12^th of August the NZD/USD was trading near the 0.64650 mark, this before it started to tumble as the weekend began. Yesterday saw a low of approximately 0.63180. Early morning volatility was certainly on display earlier today, but the fireworks may become less pervasive in the coming hours.

The NZD/USD is Straddling Important Higher Support Levels via a One Month Chart

While the lower move the past couple of days may have made bullish speculators nervous, the ability of the NZD/USD to find support near the 0.63200 level could prove important.  Yes, there will be reversals lower, which a natural part of the trading day, but if current support ratios prove durable this could spark the speculative notion the NZD/USD remains oversold.

• If the NZD/USD is able to hold the 0.63450 to 0.63350 vicinity as durable support, more buying of the Forex pair could emerge.
• Traders cannot be blamed for targeting the 0.63750 to 0.63850 level as short term upwards goals if they choose to be buyers.

Upward Trend of the NZD/USD could prove Attractive to Speculative Bulls

The NZD/USD was near the 0.62100 level on the 5^th of August, which was a depth tested since the 29^th of July and proved rather consistent as support. Since the 5^th of August the NZD/USD has incrementally been able to gain and raise its technical support levels. This morning’s continued climb from lows seen yesterday may signal additional bullish behavior is favored by financial houses as they consider the outlook of the Reserve Bank of New Zealand as it proves to be hawkish.

Traders should remain realistic regarding their speculative ambitions. The NZD/USD is able to become volatile and moves downward will certainly occur, but wagers on upside price action based on the belief that support is beginning to look technically stronger could spark more pursuit of perceived resistance which appears vulnerable and within grasp. Traders looking for additional upside momentum in the near term cannot be blamed.

NZD/USD Short-Term Outlook

Current Resistance: 0.63780

Current Support: 0.63330

High Target: 0.64120

Low Target: 0.63075

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I am looking for signs of exhaustion or continuation to start shorting.

• The NASDAQ 100 Index gaps higher to kick off the trading session on Thursday, but then turns right back around at the 13,500 level to show signs of exhaustion.
• The market looks as if it is running a bit hot at this point, so I think it’s likely that we will continue to see trouble.
• Furthermore, you need to pay close attention to the bond market, because of the bond market continues to see rising rates, which will be significant as far as negative influences are concerned on this market.

The 13,000 level underneath will be important, and therefore you need to pay close attention to it. If we break down below it, then I think we could start to see a rather significant selloff, with a potential to drop all the way down to the 12,250 level. Breaking down below that level, not only would be a significant breakdown, but it would also break through previous support, and then also would be the 50 Day EMA breaking down as well. In that scenario, it is likely that we would consider you to see further selling pressure, and would probably see various indices around the world drop.

On the other hand, if we break above the heights of the day, then it’s likely that we could go testing the 200 Day EMA above. In that scenario, we have a good shot at making a rather big move. I think ultimately, above there then you would have to look at this through the prism of a “buy-and-hold” attitude. All things being equal, this is a market that I think will continue to be a situation where the bond market will be driving everything. This marketwill continue to see a lot of volatility because quite frankly people are still trying to figure out what the Federal Reserve is going to do. As usual, they have made the situation in the market worse, due to the fact that the Federal Reserve has spoon-fed the markets for so long that they don’t believe that the Fed will remain. Nonetheless, I think we have more downward pressure than anything else just waiting to happen. With this, I am looking for signs of exhaustion or continuation to start shorting. The Friday close will be very interesting to watch as it could give us an idea as to how people truly feel about this market.

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The USD/CAD has reversed from early morning lows, and support for the moment appears rather solid and traders have important choices to make.

The USD/CAD remains within the lower realms of its range taking into consideration a one month chart.  However, this morning’s early trading broke highs seen yesterday and Friday. The USD/CAD currency pair is around 1.28700 as of this writing and is challenging values seen on Thursday of last week. When the Bank of Canada increased its interest rate on the 14^th of July the USD/CAD was trading near 1.32200 momentarily, after the hike a low of nearly 1.28300 was seen on the 23^rd.

U.S Interest Rate Hike was Anticipated and the USD/CAD Remains Turbulent

The lows seen on the 23^rd of July were penetrated on the 28^th of July when the U.S Fed hiked their interest rate, and yesterday the USD/CAD hit a monthly low of nearly 1.27675. The last time this value had been seen was on the 10^th of June. The move higher in the USD/CAD since hitting yesterday’s low needs to be looked at by traders and may prove suspicious in some eyes.

• The Bank of Canada has made it clear they intend on being hawkish and the early September monetary meeting is likely to produce another hike higher.
• Matching the U.S Fed’s moves seems to be the intent of the Bank of Canada to protect the Canadian dollar.
• Commodity prices in the energy sector and grains factor into the behavioral sentiment for USD/CAD trading.

Resistance levels should be watched closely in the short term. If the 1.28750 level begins to look durable it may set off another round of selling for the USD/CAD and begin to challenge support levels again. The move higher after yesterday’s low was seen, was likely a reaction to dropping below the 1.28000 level for the first time in a sustained manner since the second week of June.

Risk Management is Necessary as these Lower Realms of the USD/CAD get Tested

Having tested lows not seen in a month and half yesterday, the reversal higher can be viewed as a natural reaction. Traders need to be careful and should use their risk taking tactics in a thought out manner, but if current resistance levels prove strong, selling the USD/CAD and looking for the 1.28600 mark to be challenged again the in the short term may be a solid wager.

If the USD/CAD moves below 1.28600 and the 1.28500 then becomes vulnerable, lower depths could come into view which were seen yesterday. The USD/CAD does have the potential to produce volatile results, but looking for additional downside price action in the short term may be the right wager.

Canadian Dollar Short-Term Outlook

Current Resistance: 1.28775

Current Support: 1.28575

High Target: 1.28970

Low Target: 1.28212

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At this point, it’s more likely than not going to be a situation where you are waiting for signs of exhaustion that you can start shorting.

The British pound has reversed quite massively during the trading session on Thursday, recapturing the 1.20 level as traders are now starting to focus on the jobs number coming out for the Friday session. At this point, the market is likely to see a lot of resistance, perhaps near the 1.22 level. This is an area that previously had seen a bit of selling pressure, and of course, we also have perhaps the possibility of a bit of short-covering causing the recovery.

At this point, it’s more likely than not going to be a situation where you are waiting for signs of exhaustion that you can start shorting, because the US dollar is extraordinarily strong, and should continue to be so going forward. Because of this, the market then will more than likely continue the longer-term downtrend, and once we get the jobs number out of the way one would think that there should be a bit of continuation.

If we were to turn around and break above the 1.22 level, then it’s possible that we could go looking to the 50 Day EMA which is at the 1.24 level, which is also an area where we have seen interest in both directions. In other words, there should be a bit of “market memory” at that level, which could cause some issues as well. At the very least we need to get above the 1.24 level to take any rally seriously. I do believe at this point we have a situation where the market is going to continue to see rallies sold into, but that might be a tall order heading into the jobs number. The real tell on where we are going next will probably show up at the end of the day on Friday, as by then people will show whether or not they are willing to hold British pounds or US dollars heading into the weekend.

The real trade probably shows up on Monday, because even if we were to turn around the entire trend, you have plenty of time to get involved. A trend change is a process, not something that happens immediately unless there’s some type of external factor. We do not have an external factor this point so patience will be key.

DOT/USD has slumped the past handful of hours, after reaching a high water mark of nearly 8.4750 in early trading on Sunday.

DOT/USD is traversing slightly under the 8.0000 mark as of this writing; this after coming within looking distance of 8.5000 in yesterday’s trading. Sunday’s high of nearly 8.4740 touched values not seen since the 15^th of June. The abrupt selloff in Polkadot after reaching the technical high was strong and nervous conditions in the broad cryptocurrency market still exists, even after last week’s run up among many of the major digital assets.

The move lower in DOT/USD the past handful of hours is a fresh reminder that the long term bearish trend remains plainly in view.  Although DOT/USD is trading in the middle of its five-day technical chart, Polkadot remains locked near long term lows which have not been challenged for a sustained amount of time since December of 2020. Traders who are looking for further downside price action only have to look at results from one week ago to see Polkadot was below 7.4000.

However the near term range of DOT/USD has seen support hold rather demonstratively near the 7.7500 mark the past handful of days.  Certainly, optimistic bullish traders who believe the sun is set to come out in the world of cryptocurrency again are awaiting better upwards results, but the question is when a sustained rally will really be produced. Yesterday’s highs may have enticed some bullish speculation, but it does appear sellers were looking at yesterday’s apex junctures as a place to launch short positions.

Traders should remain cautious, the results the past week upwards in DOT/USD were solid, but the rather swift reversal seen the past handful of hours is a stark reminder fragile sentiment remains abundant.  If DOT/USD cannot sustain momentum above the 8.000 in the short term, skeptics may consider support near the 7.8800 level as a target for quick hitting selling positions. If the 7.8600 ratio were to suddenly falter, the next target below would likely be the 7.7500 mark.

Bullish traders who want to be part of a renewed upwards climb in DOT/USD should not be overly ambitious.  A positive move above the 8.0000 mark and a track towards the 8.1000 level would be good, but not a sign of a vast recovery in Polkadot. Until DOT/USD sustains strong price velocity upwards and breaks through the 8.5000 level – which it clearly did not do yesterday – Polkadot remains in a bearish grip, and could be considered a selling opportunity when brief reversals higher have been attained.

Polkadot Short-Term Outlook

Current Resistance: 8.1050

Current Support: 7.8600

High Target: 8.3700

Low Target: 7.6100

I would be cautious about my position size, but I certainly only have one direction in mind.

The gold market had initially fallen on Friday and then fell even quicker once the inflation numbers came out much hotter than anticipated. However, the bond market reversed as people started to buy bonds in fear of a recession, and in a bit of a knock-on effect, this market has skyrocketed to pierce the 50-day EMA.

Looking at this chart, if we continue to go higher from here, we will more than likely attack the $1900 level. If we can break above the $1900 level, then it’s likely that we could see the gold market looking to the $2000 level. In general, I do like gold for the longer term, and after the action that we had seen during the day on Friday, it does suggest that there are plenty of buyers out there. I think now you can look at this as a “buy on the dips” type of scenario unless we see a significant shot higher in interest rates.

If we were to turn around, you have to believe that there is a significant amount of support at the $1835 level. Furthermore, you probably have support at the $1825 level as well. In other words, this is a market that will continue to be noisy, but it certainly looks as if people are willing to get involved and start getting long on any type of value that is offered. Ultimately, I do think that we eventually find the $2000 level, as the old correlation between inflation and gold reemerged during the Friday session.

I would be cautious about my position size, but I certainly only have one direction in mind. The Friday session changed almost everything, and now it’s simply a matter of trying to find some type of value. I don’t know that I would jump into this market right away, but if we get an opportunity to take advantage of value, then that’s what you should be doing. The 200-day EMA is flat and slicing through the candlestick for the day, so it shows that we are going to continue to see a lot of consolidation, and if we were to get the second impulsive candlestick, that will change the entire complexity of the market.

ETH/USD is flirting with short-term highs as an intriguing reversal higher has formed and may stir the hearts of optimistic bullish speculators.

In early morning trading, ETH/USD has been able to topple the 2,000.00 juncture and touched a high briefly near the 2,224.00 ratio.  A downturn has occurred since the high value was achieved and ETH/USD as of this writing is below the 2,000.00 mark. However, ETH/USD has not seen a violent reversal lower and its ability to flirt with the 2,000.00 juncture may be enough to spark the interest of speculators who have bullish tendencies.

This morning’s price action will likely not be enough to create a vast sea change of speculative fever. On the 27^th of May ETH/USD was trading below the 1,700.00 price which had last been sincerely traded with high volumes in March of 2020. The long term bearish trend within the broad cryptocurrency markets cannot be proclaimed dead yet. Technical traders however will no doubt watch the 2,000.00 level with interest.

If Ethereum is able to jump the important psychological mark of 2,000.00 and sustain its value above, this would spark raised eyebrows.  From the 12^th until the 23^rd of May ETH/USD battled the 2,000.00 region and finally melted beneath the level, and began to seek new long term lows with a crushing amount of selling. The question day traders need to consider is if the rally being displayed now has legitimate staying power or if it will quickly disappear.

Short-term momentum traders who are aggressive may want to pursue the 2,000.00 target and slightly above for quick hitting trades.  The costs of transactions must be factored with such close by targets and this raises the potential that a larger amount of leverage is needed to create profitable results when trying to scalp ETH/USD with fast results – which carries significant risks if the market goes against the speculator. Traders who prefer momentum to be on their side may want to wait until Ethereum shows even better results.

If the 2,025.00 resistance level were to be challenged and penetrated higher this could spur on additional buying.  However, skeptical traders who continue to lurk and do not believe ETH/USD has seen the last of its bearish trend, may believe that if ETH/USD cannot muster much price action above the 2,010.00 to 2,025.00 price vicinities more selling will happen. Speculators looking for additional movement downwards may target the 1975.00 to 1965.00 marks cannot be blamed. Choppy conditions are likely to be seen short term and traders should remain cautious.

Ethereum Short-Term Outlook

Current Resistance: 2019.00

Current Support: 1939.00

High Target: 2078.00

Low Target: 1844.00

ADA/USD is near important support in early trading this morning, as a reversal produced late on Monday reminded crypto traders a bearish storm still exists.

ADA/USD displayed a strong selling reversal in late trading on Monday and sank to a price of nearly 50 and a quarter cents momentarily.  In early trading this morning ADA/USD has climbed higher, but it remains within sight of important support levels. The lingering images of support junctures on charts should keep technical traders rather nervous, as they are served strong reminders that the long term bearish trend in the broad crypto market continues to create sudden declines.

ADA/USD is trading slightly above 52 cents as of this writing; yesterday’s high in Cardano was slightly below 56 cents.  ADA/USD sank after touching this mark and its trading mirrored the results among its major digital asset counterparts as a selling wave developed across the board. Perhaps profit taking took place among traders who had been waiting for higher ground to be demonstrated so they could cash out positions.

Or more troubling, is the notion that durable resistance levels continue to shadow the crypto market. The highs generated yesterday may have been taken advantage of as a way to close positions, which had reached equilibrium and allowed traders to walk away from positions which had been weighing them down with losses.

ADA/USD offers traders an opportunity to engage in short term trading tactics. Nearby support around the 0.51750000 level could prove important, if this level proves vulnerable short term it could spark additional concerns that selling momentum will increase. The inability of Cardano and other major cryptocurrencies yesterday to hold onto near term highs may be the beginning of another serious leg down. While some bullish traders may believe ADA/USD has been oversold, skeptics who remain sellers may look at moves higher as a way to ignite selling positions.

The long term bearish trend remains intact in the cryptocurrencies and ADA/USD has suffered like its major counterparts.  Speculators who have the courage to be sellers and pursue downside momentum based on the perception that current support levels will falter and lows seen on the 20^th of May will be retested cannot be faulted. If ADA/USD breaks below current support and price velocity is strong, Cardano could challenge important depths quickly. Traders need to use take profit and stop loss tactics to make sure the price of ADA/USD does not surprise and harm them.

Cardano Short-Term Outlook

Current Resistance: 0.52670000

Current Support: 0.51720000

High Target: 0.53460000

Low Target: 0.50330000

The US dollar jumped strongly after US inflation figures for April came in stronger than markets had expected, leading to warnings that it may take some time before price increases begin to slow. Accordingly, the price of the USD/JPY currency pair remained stable around and above the 130.00 psychological resistance, which is leading the currency pair towards its highest in 20 years. At the beginning of this week’s trading, the currency pair jumped towards the resistance 131.35 before settling around the 130.00 level at the time of writing the analysis.

According to official figures, the headline inflation of the US consumer price index rose by 8.3% on an annual basis in April, exceeding the agreed forecast of 8.1%. The figure is less than 8.5% in May. But it was this win over expectations that moved the markets and saw the dollar rise rapidly as investors bet that the Fed would remain vigilant and proceed with a series of US interest rate increases.

Core US CPI inflation rose 0.6%, doubling the 0.3% rate recorded in May, but came in slightly above expectations of 0.2%. Commenting on the figures, Richard Carter, head of fixed interest research at Quilter Cheviot, said: “It is too early to declare victory with inflation likely to remain elevated for some time to come, while energy prices may also rise if the Ukraine war escalates.”

Carter adds that while inflation in the US has hopefully peaked, other countries cannot say the same, and this has become a global problem. Prior to the inflation release, money markets were pricing in nearly 200 basis points for the 2022 Fed rate increase. The numbers will at least keep that expectation supportive. Concerns about global economic growth are growing because of the rapid pace of the Federal Reserve in tightening, which is effectively draining liquidity from the United States and the global economy.

The US economy will inevitably begin to slow down as a combination of slowing global growth and higher financing costs take effect.

The US Dollar Index (DXY) surged to a new 20-year high this week on continued expectations of rapid Fed tightening and fears of a global economic downturn that tends to benefit the anti-cyclical dollar. The index a measure of the broader strength of the US dollar based on several key dollar exchange rates. jumped on the heels of the inflation figures and reaffirms that weakness is likely to be seen as temporary in this environment.

According to the technical analysis of the pair: By examining the performance of the USD/JPY currency pair on the daily chart, it seems clear that the bulls’ control of the trend has approached the peak. The markets have absorbed all the events supporting the dollar from raising interest rates and the results of the most important US economic releases and technical indicators have reached overbought levels. It may be the strongest opportunity for profit-taking selling and a trend reversal. Moving in narrow ranges for several trading sessions in a row portends an upcoming strong move.

The closest targets for the bulls are 130.65 and 131.30, respectively. The first shift in the trend needs to move towards the support levels 128.65 and 126.70, respectively.

ETH/USD is still within the lower part of its long term price range, as support levels try to hold back selling and reversals higher fail to impress.

As of this writing, ETH/USD is near the 2380.00 level as it lingers within long-term depths and broad cryptocurrency market nervousness remains on full display. ETH/USD hit an early low yesterday of 2195.00 which had not been seen since the spike downward on the 24^th of January. However, to make the dark news even worse, ETH/USD remains within a price juncture it has not sincerely traded for a long duration since late July of 2021.

While optimistic bullish traders who like to buy when they believe ETH/USD has been oversold may be lurking, they have failed to produce a significant run higher. Resistance levels above the 2440.00 mark appear rather durable. Until Ethereum is able to actually brush aside several technical upward hurdles, any type of upwards trajectory will not be taken seriously by trend followers.

If ETH/USD continues to struggle near the 2400.00 juncture and if the cryptocurrency proves incapable of establishing a push above, bearish speculators may remain in a hunting mode for more downward momentum. The broad digital asset market remains tentative and ETH/USD as a leader of the pack has demonstrated a lack of firepower. If the 2365.00 suddenly becomes vulnerable, traders cannot be blamed for believing additional lower ratios will be exhibited.

The danger for ETH/USD is actually rather stark and nearby, regarding technical levels which may prove to be rather important.  If the 2340.00 juncture begins to be seriously challenged, Ethereum may be signaling that it is ready to fall with greater velocity. Until now through the selling carnage which has been on full display the past week, ETH/USD has been able to hold back the worst of the selling tides. Ethereum’s long term support levels have been flirted with but have not completely collapsed, if the 2340.00 is brushed aside and falters without a solid reversal higher, this could ignite a storm lower which once again tests long term support.

Traders are urged to use solid risk taking tactics due to the amount of nervousness in the markets. Yesterday’s trading was calm compared to Monday’s, but shadows lurk and mistaking quiet as the end of storm could prove dangerous.

ETH/USD could simply be in the eye of the hurricane and remain quiet for a little while longer, until turbulence is delivered with full force again. Speculators who want to be sellers cannot be blamed for their wagers, but they should practice caution and keep their price ambitions realistic.

Ethereum Short-Term Outlook

Current Resistance: 2423.00

Current Support: 2349.00

High Target: 2488.00

Low Target: 2168.00