Central banks' policies will be key price-driving events in October, but the latest job report of the US could indicate whether the Fed has reached the peak of hawkishness.
The latest panic in the market with the renewed rush on USD bulls, other banks like the Reserve Bank Of Australia and New Zealand could extend their tightening policies.
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Forex Technical Outlook for 03 October 2022 to 07 October 2022
Non-farm payroll for September will be the key event to look at where the current expectation is a 265K job increase, down from 315K. Before that, investors may experience volatility from RBA and RBNZ rate decisions.
The list of major economic events going to happen this week:
- CHF CPI m/m on Monday
- ISM Manufacturing PMI on Monday
- RBA Cash rate Rate Statement on Tuesday
- JOLTS Job Openings on Tuesday
- RBNZ official cash rate and Rate Statement on Wednesday
- OPEC Meetings on Wednesday
- ISM Services PMI on Thursday
- Non-Farm Employment Change on Friday
- CAD Employment Change on Friday
Let’s start the forex outlook for 03 October 2022 to 07 October 2022 with the US Dollar index:
The US Dollar index moved down after reaching the 114.77 peak, where the recent selling pressure was insignificant.
This week, the bullish pressure in the US Dollar index may regain bullish pressure if bears fail to take the price below the 110.74 event level with a bearish daily close. However, breaking below the 110.50 level could lower the price to the 107.70 area.
As per our previous EUR/USD weekly price forecast, bears took control over the price since the weekly opening and reached the 0.9600 key number with 76 pips of gain.
Moreover, a bullish recovery was seen from the 0.9600 level with a bullish engulfing pattern, which indicated that the price probably found a bottom.
This technical analysis indicates the daily price action of EUR/USD, where the current price is trading higher after making a new swing low at the 0.9534 level. However, the buying pressure failed to make a significantly higher high to consider the trend change as strong.
Moreover, the fixed range high volume indicator from August high to September low is still above the current price. Although last week’s price came with 200+ pips of upside pressure, it failed to come with a solid volume change.
The Traders dynamic index, a unique tool to determine sellers' and buyers' momentum in the market, rebounded above 50% and headed towards the upper band.
In this price context, the buying pressure in the EUR/USD price is not strong, but a bullish recovery above the 0.9900 level with a daily close would confirm the bull run towards the target of the 1.0366 level.
On the other hand, any bearish rejection from 0.9850 to 0.9920 would be a bearish opportunity targeting the 0.9600 area.
- EUR/USD Important support levels: 0.9534
- EUR/USD important resistance levels: 0.9900 and 1.0366
A strong bullish exhaustion below the multi-year low showed a buyers’ interest in the GBP/USD price, which could work as a strong trend reversal.
Unline EURUSD, GBP/USD bulls came with strong buying pressure with a change in high volume level. As a result, we may consider the buying pressure as strong but the massive 800 pips movement from the 1.0357 swing low should show some bearish correction before making another bullish attempt.
The Dynamic 20-day EMA is still above the current price, which needs to be overcome before forming a trendline breakout. However, the Traders Dynamic Index reached the overbought zone, indicating that bulls have reached the ceiling from where a correction is pending.
This week, any selling pressure from the 1.1250 to 1.1380 area would be a potential bearish opportunity in this pair, targeting the 1.0800 area.
On the other hand, a bullish recovery and a daily close above the 1.1390 level could extend the buying pressure towards the 1.1600 area.
- GBP/USD Support Levels to focus: 1.0763
- GBP/USD Resistance levels to focus: 1.1375
The selling pressure was extended in the AUD/USD price throughout the week as the price failed to hold momentum above the 0.6532 level.
This technical analysis indicates how bears are aggressive in the AUD/USD daily price below the 0.6532 level, which will be the main event level to look at for this week.
In the fixed range high volume indicator, the highest activity level is at 0.6489 level, which is above the current price. As a result, the current bearish pressure below the 0.6489 level looks solid that may offer further bearish opportunities in the coming days.
Among other indicators, the dynamic 20 EMA is above the price, working as an immediate resistance level. Moreover, the Traders Dynamic Index is below the 20% level with a possibility of reaching the oversold area.
Based on the AUD/USD price prediction, the bearish pressure is solid as long the price trades below the 0.6532 event level. In that case, the selling pressure may extend towards the 0.6300 area.
On the other hand, a bullish recovery and the daily close above the 0.6540 level would open a long opportunity targeting the 0.6900 area.
- AUD/USD important support level: 0.6300
- AUD/USD important resistance levels: 0.6532
The outside bar formation in the USD/JPY price from the Bank Of Japan’s declaration to intervene in the forex market increased the volatility with a formation of a new monthly high volume level. However, sellers failed to show an interest in this pair, but it is time to see how it trades from the latest monthly high volume level.
This technical analysis of USD/JPY came with a buying pressure last week, but bulls failed to overcome the 144.73 high volume level with a strong bullish daily close.
The dynamic 20 EMA has become the immediate support to look at from where a bullish rejection is visible. Moreover, the TDI level started moving up, where a stable position above 50% will indicate a buying pressure in the price.
In the USD/JPY weekly forecast, a bullish daily candle above the 145.00 level would open the possibility of reaching the 148.00 level. However, breaking below the 143.00 level would eliminate the current bullish outlook with a possibility of moving down towards the 140.40 support level.
- USD/JPY important support areas: 144.12
- USD/JPY Resistance levels to focus: 148.00
The buying pressure appeared in the XAU/USD price as expected in the previous weekly forecast. The broader market trend is still bearish where any trend continuation opportunity will be profitable in this pair.
This technical analysis of XAU/USD shows how the high volume level from August high to September low remained above the current price. Moreover, the dynamic 20 EMA reached the 1673.05 high volume level to provide a confluence resistance from which bears may regain momentum.
As the broader market trend is bearish, any bearish rejection from 1670.00 to 1690.00 area would be a bearish opportunity towards the 1620.00 area. On the other hand, breaking above the 1700 level with a bullish daily candle could provide a long opportunity, targeting the 1734.00 area.
- XAU/USD important support level: 1600.00
- XAU/USD important resistance levels: 1687.53.
Bitcoin remained above two important support levels, but the new bearish quarterly close would increase the volatility during the weekly birth period, which traders should care about.
A strong bottom in the BTC/USD price was seen at the 19,230.00 level on 30 June, from where a 30% price increase appeared to the 25,205.00 swing high. However, buyers got punished by the stronger US Dollar, resulting in a 27% crash to the 18,210.00 swing low formed on 18 September 2022.
This technical analysis indicates sellers' presence in the market, where the immediate static resistance is at the 22,742.43 level. Moreover, the dynamic 20-day EMA is above the price, sloping down, while the trades dynamic index is yet to move below the 40% level.
Based on the weekly forecast for BTC/USD, a bearish daily close below the high volume level of 19,021.30 level would increase the downside pressure towards the 16,000.00 level. However, the bullish recovery needs a daily close above the 20,400.00 level before aiming toward the 22,742,43 resistance level.
- BTC/USD important support level: 19,021.30
- BTC/USD important resistance level: 20,376.14
The US Dollar is already strong against the basket of currencies. However, the new monthly and quarterly start may come with reversal momentum before forming the actual trend.