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WTI oil price is easing for the third day, correcting lower from new multi-week high ($84.50, the highest since mid-Apr).

Bulls lost traction after milder than expected impact of the hurricane on oil installations in the Gulf of Mexico, eased concerns about supply shortages and prompted traders to collect profits.

Current pullback is seen as correction of a larger uptrend from $72.46 (June 4 low) which should find firm ground at $80 zone (psychological / Fibo 38.2% of $72.46/$84.50 daily cloud top), to mark a healthy correction and offer better buying opportunities.

The notion is supported by overall bullish picture on daily chart and persisting supply concerns over the conflict in the Middle East.

Res: 82.50; 83.00; 84.03; 84.43.
Sup: 81.66; 81.00; 80.00; 79.61.

Cable is holding within a narrow range under new multi-week high during European trading on Tuesday, as markets await today’s key event - the testimony of Fed Chair Powell.

Long upper shadow of Monday’s daily candle and overbought conditions on daily chart suggest that bulls may take a breather at 1.2800 zone (also Fibo 76.4% of 1.2860/1.2612 bear-leg).

Bullish studies favor further upside, with consolidation likely to be narrow, before final push towards targets at 1.2860/93 (Jun 12 high / 2024 top).

Comments from Powell are likely to be dovish and to add to expectations for rate cut plans however, Thursday’s release of US June inflation report would play significant role after policymakers reiterated their stance that rate cut decision will highly depend on economic data.

Initial supports at 1.2788/65 (Monday’s low / broken Fibo 61.8%) should ideally contain, with extended dips not to exceed daily Kijun-sen (1.2736) to keep larger bulls in play.

Res: 1.2822; 1.2845; 1.2860; 1.2893.
Sup: 1.2788; 1.2769; 1.2736; 1.2713.

Hello fellow traders. In this article we’re going to take a quick look at the Elliott Wave charts of DAX published in members area of the website. As our members know DAX is showing impulsive bullish sequences and we are keep favoring the long side. Recently we got a 3 waves pull back that has ended right at the Blue Box zone (buying area). In the further text we are going to explain the Elliott Wave Forecast and trading setup.

DAX Elliott Wave 1 Hour Chart 06.20.2024

DAX remains bullish against the 17629.4 pivot. The Index has made clear pull back in 3 waves. The price already reached Extreme zone ( buying area) at 18036.25-17653.97 and giving us reaction. As our members know Blue boxes are based on 100% – 161.8% Fibonacci extension area , that we trade in 3, 7, or 11 swing corrective sequence. DAX index should ideally make a rally toward new highs or 3 waves bounce alternatively.

Once the price touches the 50 fibs against the ((b)) black connector, we’ll make positions risk-free and set the stop loss at breakeven and book partial profits. Breaking below the 1.618 Fibonacci extension level at 17653.97 would invalidate the trade.

Official trading strategy on How to trade 3, 7, or 11 swing and equal leg is explained in details in Educational Video, available for members viewing inside the membership area.

Quick reminder on how to trade our charts :

Red bearish stamp+ blue box = Selling Setup
Green bullish stamp+ blue box = Buying Setup
Charts with Black stamps are not tradable. 🚫

DAX Elliott Wave 1 Hour Chart 07.08.2024

DAX made a nice reaction from our buying zone. The index has reached and exceeded 50 fibs against the (B) blue high. So members who took the long trade are enjoying profits now in a risk free positions. We would like to see break of ((3))) black high, to confirm next leg up is in progress.

As shown by the XAU/USD chart, on Friday, 5 July, the price of gold rose above the $2390 level for the first time since 22 May. According to Reuters, this increase occurred following the release of key US employment data, which indicated a softening labour market, raising expectations of a Federal Reserve interest rate cut in September.

However, yesterday, Monday, the gold price fell to $2360 per ounce – the level from which Friday's ascent began. This suggests that the bulls were unable to maintain control over the market, which indicates a bearish sign.

Could the Gold Price Decline in the Coming Days?

From a technical analysis perspective of the XAU/USD chart:

• The gold market has clear support around the $2300 area. Each time the price fell below this level in June (as indicated by arrows), it quickly rebounded upwards, demonstrating sustained demand.
• Price action since April provides enough reference points to establish a descending channel (shown in red). The recent bearish reversal returned the price within this channel, reinforcing resistance from its upper boundary.
• There is also reason to believe that the bullish breakout of local resistance (shown in black) might be false.

Therefore, signs of seller activity in the $2380-2400 range suggest that the gold price could continue to decline towards the important support at $2300.

External Influences on the Gold Market

The head of the Federal Reserve, Jerome Powell, is likely to have a significant impact on the gold market. Powell will testify before Congress, starting with an appearance in the Senate on Tuesday at 17:00 GMT+3, followed by the House of Representatives on Wednesday at 17:00 GMT+3.

If Powell hints directly or indirectly at signs of weakness in the US economy, this could provide a positive impulse for the gold price. In such a scenario, expectations of an imminent rate cut may increase (currently, according to CME’s FedWatch Tool, the probability of a September rate cut is estimated at 77%). The attractiveness of non-yielding gold bars typically rises in a low-interest-rate environment.

Start trading commodity CFDs with tight spreads. Open your trading account now or learn more about trading commodity CFDs with FXOpen.

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Market picture

Bargain hunters are showing themselves in full force in crypto. Cryptocurrency market capitalisation rose 3.6% in 24 hours to $2.11 trillion, climbing back to the top of the range of the past five days. It will take the market to rise another 2% before we can say that the bear attack has been repelled. Until then, we can only talk about consolidation after the sell-off.

Bitcoin rebounded to $57.3K after a couple of dips to $54K, sticking to its descending channel that has been in force since March, but the price is very dangerously stuck at the bottom of this corridor. This situation makes us fear an acceleration of the sell-off with a potential target in the $50-51K area, where the crypto market was stagnant in February.

Ethereum trades at $3050 and remains below the 200-day moving average but has not given up trying to climb higher. Here, ETH has a strong support line, which also attracted buyers in April and May. More on the bulls’ side is that the RSI on daily timeframes rises from oversold territory. These are promising technical signals, but the sustained sell-off from the US and German governments and the overhang of selling from Mt Gox lenders is clearly undermining the confidence of too many buyers.

News background

According to CoinShares, investments in crypto funds rose by $441 million last week for the first time after three weeks of outflows. Bitcoin investments increased by $398 million, Solana by $16 million, Ethereum by $10 million.

Recent price declines, driven by potential selling pressure from Mt Gox and the German government, were probably seen as a buying opportunity. Inflows into BTC accounted for only 90% of the total inflows, as investors chose to invest in a much broader set of altcoins. The most notable of these was Solana, which has received $57 million in investments since the beginning of the year, making it the most efficient altcoin in terms of flows, CoinShares noted.

German authorities continue to transfer Bitcoins to exchanges. On 8 July, two 250 BTC transfers were made to Coinbase and Bitstamp platforms. Transactions of 700 BTC and 500 BTC followed to unidentified Arkham numbers.

The Bitstamp exchange promised to distribute the payments from Mt Gox “as soon as possible,” despite having a 60-day deadline. So far, only Japanese BitBank and SBI VC Trade addresses have been distributed coins. The three remaining recipients – Bitstamp, Kraken and BitGo – are still awaiting their turn. The trustee has 94,771 BTC (~$5.4bn) left to send.

Bitfinex points out signs of a potential end to the market correction. Short-term investor selling is potentially close to exhaustion. Meanwhile, the funding rate for perpetual BTC contracts has turned negative for the first time since 1 May.

The EUR/USD pair is maintaining its position close to a multi-week high of 1.0829, benefitting from the weakening US dollar following a disappointing June US employment market report. Market anticipation is now building ahead of an upcoming speech by Federal Reserve Chair Jerome Powell.

Despite the looming potential for political deadlock in France, the euro has remained resilient. Investors are finding reassurance in the belief that the current political situation may act as a deterrent to any drastic fiscal measures from far-right or far-left parties, thereby stabilising the financial landscape.

With a relatively quiet macroeconomic calendar, attention is squarely on the US interest rate trajectory. According to CME FedWatch, the likelihood of a rate cut at the Fed's September meeting has increased to 76%, up from 66% the previous week. Expectations are also growing for a second rate cut in December.

Jerome Powell's testimony before Congress, starting Tuesday, will be pivotal for currency markets, as insights into the Fed's policy outlook could influence exchange rates significantly.

Technical analysis of EUR/USD

The EUR/USD is navigating through a consolidation range just above the 1.0806 level. There is a strong potential for an upward move towards 1.0900, which is currently being considered. If this level is reached, a retest to 1.0844 may follow before another potential rise to 1.0944. This bullish setup is further supported by the MACD indicator, where the signal line remains above zero and points upwards, indicating a continued upward momentum.

On the H1 chart, the market is poised for further advancement after completing a growth pattern to 1.0840 and a subsequent correction to 1.0820. A move towards 1.0844 is expected. If this level is breached, it could pave the way to 1.0900. The Stochastic oscillator reinforces this outlook, with the signal line currently above 50 and trending upwards, suggesting a strengthening bullish momentum.

Investors will be keenly watching for Powell's comments and any further economic indicators this week, as they could play a crucial role in shaping short-term market dynamics and currency valuations.

• GBPUSD rebounds from its 50-day SMA
• The price jumps to its highest since June 12
• Momentum indicators are tilted to the upside

GBPUSD has been slowly gaining ground following its bounce off the 50-day simple moving average (SMA) in late June. Moreover, the pair has entered a range that has previously rejected further advances during the past year, thus traders should be careful not to get overly optimistic.

Should upside pressures persist, the price may clear the 1.2816-1.2859 range, defined by the recent three-month peak and the December 2023 high. A violation of that zone could pave the way for the 2024 high of 1.2892. Failing to halt there, the pair could storm towards the July 2023 resistance of 1.2994.

Alternatively, if the price experiences a pullback, the April resistance of 1.2708 could act as the first line of defence. Further declines could then cease at the 1.2620-1.2598 territory, which is framed by the June and March lows. Even lower, the February bottom of 1.2517 may provide downside protection.

Overall, GBPUSD has been on the rise in the past few sessions, attempting to revisit its 2024 peaks. However, a failure to storm to fresh highs could easily trigger a pullback.

• EURJPY struggles to jump above its recent high
• Momentum oscillators look overstretched

EURJPY skyrocketed to a fresh multi-year high of 174.60 in the previous week but is currently hovering slightly below this level, with the technical oscillators suggesting an overstretched market. The RSI is trying to cross the 70 level to the downside, while the MACD is weakening its positive momentum above its trigger and zero lines.

Should the pair stretch south, the previous peak of 171.55 could provide immediate support near the 20-day simple moving average (SMA), as well as ahead of the 170.80 level. A significant step lower could bring bearish sentiment into play, sending the price probably towards the 50-day SMA at 169.70 and the 23.6% Fibonacci retracement level of the up leg from 153.20 to 174.60 at 169.50, which stands near the uptrend line.

On the flip side, another upturn may require the pair to retest the 174.60 barricade before opening the way to fresh uncharted levels such as 175.00 and 176.00.

To summarize, EURJPY has climbed to new levels since the euro’s inception, indicating a strongly positive outlook in the long term. A decline beneath the uptrend line and, more importantly, below the 200-day SMA at 163.23, could switch the outlook to bearish.

Daily Pivots: (S1) 205.28; (P) 205.98; (R1) 206.66; More...

Intraday bias in GBP/JPY is turned neutral with loss of momentum as seen in 4H MACD. On the upside, sustained break of 100% projection of 191.34 to 200.72 from 197.18 at 206.56 will target 138.2% projection at 210.17. On the downside, below 204.97 minor support will turn bias to the downside for deeper pull back.

In the bigger picture, long term up trend is still in progress. Next target is 100% projection of 155.33 to 188.63 from 178.32 at 211.62. Outlook will stay bullish as long as 197.18 support holds, even in case of deep pullback.

Daily Pivots: (S1) 173.54; (P) 174.08; (R1) 174.65; More...

Intraday bias in EUR/JPY remains neutral for the moment. On the upside, firm break of 174.50 will resume the larger up trend and target 138.2% projection of 164.01 to 170.87 from 167.52 at 177.00. On the downside, however, break of 173.07 will turn bias to the downside for deeper pullback.

In the bigger picture, long term up trend is still in progress. Next target is 100% projection of 139.05 to 164.29 from 153.15 at 178.38. For now outlook will stay bullish as long as 170.7 resistance turned support holds, even in case of deep pullback.