CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

Two trades to watch: Gold, EUR/USD

Article By: ,  Senior Market Analyst
October 20, 2022 8:46 AM

Gold looks to jobless claims & Fed speakers

Gold fell 1.4% yesterday as treasury yields, and the USD rose. Fed speakers continued to sing from the hawkish song sheet. 

Federal Reserve President Neel Kashkari, a habitual dove, hammered home the hawkish message saying that the Fed couldn’t consider pausing rate hikes while core inflation continued to rise.

Today yields continue to rise, exerting pressure on gold. However, the USD is easing lower, which is supporting the precious metal.

Looking ahead, US jobless claims are expected to tick modestly higher to 230k, up from 228k in the previous week.

Federal Reserve speakers will also be in focus, with the Fed’s Jefferson, Bowman, and Cook due to hit the airwaves. More hawkish rhetoric could pull Gold back towards 1600.

Where next for Gold price?

Gold has rebounded lower from the 50 sma at 1727 at the start of October, falling below the 20 sma. This, combined with the RSI below 50 keeps sellers hopeful of further downside.

Sellers will look to break below 1614 the 2022 low to create a lower low and bring 1600 into target.

On the flip side, buyers could look for a move over 1654, the mid-September low. A rise above 1667, the 20 sma to open the door to 1680, the July low.

 

EUR/USD edges higher after German PPI

 

EUR/USD is rising, recouping losses from the previous session as USD bulls pause for breath.

Headline eurozone inflation rose to 9.9% YoY in September. This was below the 10% initially forecast but is sufficiently high to keep pressure on the ECB to raise interest rates by 75 basis points at next week’s meeting.

German PPI remained stubbornly high at 45.8% YoY in September, in line with August but above forecasts of 44.7%. PPI is considered a lead indicator for consumer prices, suggesting that consumer prices will continue to rise.

Meanwhile, the USD is broadly supported by the hawkish Federal Reserve, and safe haven flows as global recession fears rise.

Looking ahead, US jobless claims and several Fed speakers could lift the USD.

Where next for EUR/USD?

 

EUR/USD has formed a series of lower lows and lower since February. The pair ran into resistance this week at 0.9865 and is edging lower. The RSI is just below 50, which suggests that momentum supports the downside.

Sellers are looking for a break below support at 0.9750 the 20 sma and the multi-week falling trendline. A break below here opens the door to 0.9650, the October 13 low, and 0.9535, the 2022 low.

Buyers will rise above 0.9870 the weekly high, exposing the 50 sma at 0.9920 and 1.00 the October high.

 

 

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024