The US Payroll increased by 263K in November, while the unemployment rate remained unchanged at 3.7%. The average hourly earnings rose by 0.6%, with an increase in personal spending of 0.7%.
There are some signs that inflation has peaked in some countries. For example, the Eurozone price experienced relief from the price pressures for the first time this year. The headline CPI for the Eurozone came down to a 10.0% level from 10.60% in October. Moreover, Australian inflation showed the same result coming down to 6.9% year-over-year.
Forex Technical Outlook for 05 December 2022 to 09 December 2022
The week is going to be volatile as several central meetings are pending. The RBA and BOC could increase the central bank interest rate as part of fighting the higher inflation. Moreover, investors will see the US PPI on Friday, which could provide a clue about the upcoming FOMC.
Let’s see the important events from this week:
- ISM Services PMI on Monday
- Cash Rate & RBA Rate Statement on Tuesday
- The UK GDP q/q on Tuesday
- BOC Overnight rate and Rate Statement on Wednesday
- The US PPI & Core PPI m/m on Friday
Let’s proceed with the DXY outlook:
The US Dollar Index (DXY) reached the August 2022 low with no indication of a bullish reversal. Therefore, a stable bearish daily close below the 104.63 level will indicate a bearish break-of-structure, which could indicate a bearish possibility towards the 103.66 level.
EUR/USD price showed a stable position above the dynamic support, eliminating the bearish possibility of a range breakout. Therefore, as long as the price trades above the visible range high volume level, we may aim for the upcoming price direction as bullish.
This technical analysis shows how the price is holding a bullish momentum after impulsive pressure. Moreover, the recent price action formed new higher lows, which is a sign that bulls are still interested to buy from the higher price.
Moreover, the fixed range high volume level from November high to low is at 1.1035, which is just below the current price. It is a sign that buying activity in this pair is stronger than sellers, which could offer a long opportunity in the coming days.
The 20-day Exponential Moving Average is below the current price, aiming higher, which is a sign of active buying pressure in the market. Moreover, the Relative Strength Index (RSI) is stable above the 50% level, providing active buying pressure.
Based on the current price outlook, the buying possibility in this pair is potent as long as it trades above the 1.1035 high volume level. In that case, the upside pressure can extend towards the 1.0936 resistance level.
The alternative trading approach is to wait for the price to come below the 1.0220 level and form a daily candle close. In that case, the selling pressure may extend towards the 0.9800 area.
- EUR/USD support levels to look at: 1.0293
- EUR/USD resistance levels to look at: 1.0936.
The bullish pressure in the GBP/USD price was potent from the pennant pattern breakout. As a result, the last week ended with a decent 400 pips gains to bulls.
This technical analysis indicates how buying pressure is active in the GBP/USD price, where the current price is trading above the dynamic 20 EMA support and visible range high volume level.
Based on the fixed range high volume level indicator, the highest trading volume from November high to low is at 1.1895 level, which is below the current price. Therefore, it is a sign that bulls are still interested in the price to make new swing highs.
The Relative Strength Index (RSI) for the daily GBP/USD price is hovering at the 70% area, while the dynamic 20-day Exponential Moving Average is at the 1.1892 static support level.
Based on the daily price outlook, GBP/USD bulls have a higher possibility of extending the buying pressure towards the 1.2670 level. On the other hand, any bearish pressure with a daily close below the 1.1880 level would open a short opportunity towards the 1.1294 support level.
- GBP/USD support levels to look at: 1.1892.
- GBP/USD resistance levels to look at: 1.2870.
As per the previous weekly AUD/USD forecast, bulls remained strong in the market and extended the buying pressure by making a new swing high. However, the potential RSI divergence with a bearish two-bar reversal on Friday could hint at sellers’ weakness in the price.
This technical analysis of AUD/USD shows how the price is trading below multiple key supply levels at 0.6915 and 0.7008. These levels are potential in this price context as they appeared while making new swing highs and remained untested. Therefore, as the current price is trading below these levels, we aim for finding bearish trading opportunities.
Based on the high volume level from November high to low, which is below the current price. It is a sign that bulls are still controlling the price and might extend the momentum in the coming days.
Based on the current price outlook, a bearish daily candle below the static 0.6843 level would validate the bearish possibility in this pair, targeting the 0.6272 level.
On the other hand, any buying pressure from 0.6750 to 0.6840 area coils extend the bullish momentum towards the 0.7000 level.
- AUD/USD support levels to look at: 0.6643
- AUD/USD resistance levels to look at: 0.7000.
USD/JPY failed to hold the bullish momentum and showed a strong rebound with a new swing low formation below the dynamic 20 EMA resistance.
This technical analysis shows how bears extended the momentum towards the 133.63 level, which could be the next potential support level.
As the current market trend is bearish and the fixed range high volume level from November high to low is above the current price, we may expect the selling pressure to extend in the coming days.
The dynamic 20-day EMA is above the price and RSI reached the oversold zone. Therefore, a rebound and a bullish daily close above the 139.90 level could eliminate the current bearish opportunity and extend the bullish pressure towards the 148.00 area.
- USD/JPY support areas to look at: 133.63
- USD/JPY Resistance levels to focus: 139.90.
The bullish trend continuation opportunity already provided a decent profit as shown in the previous XAU/USD weekly price forecast.
This week, the situation is indifferent as the week ended trading with a bullish pressure, influenced by the post-NFP recovery.
The XAU/USD buying pressure is visible in this technical analysis where the dynamic 20 EMA is carrying the price to form a bullish breakout. Moreover, the high volume level from November high to low is at 1761.20, which is a sign of active buying pressure in the market.
In the indicator window, the Relative Strength Index (RSI) is above the neutral 50% area and aiming towards the overbought 70% level.
In that case, the bullish possibility in the XAU/USD daily price is potent as long as it trades above the 1761.00 level. In that case, the upside pressure could extend the momentum towards the 1879.00 area. On the other hand, a bearish range breakout with a daily candle below the 1727.00 level could extend the selling pressure towards the 1650.00 area.
- XAU/USD support level to look at: 1761.20.
- XAU/USD resistance levels to look at: 1879.31.
Bitcoin price showed massive buying pressure in recent trading days, while the post-NFP sentiment boosted the momentum.
Based on the previous monthly performance, the BTC price has a higher possibility of making it to the bottom at the 15,550.00 level. However, the validation of this level is still pending as any selling pressure below this could change the bottom to the 10,000.00 level.
In 2022, the average monthly return for BTC is -7.39% compared to the 14.32% average in the last 13 years. In this condition, the BTC price could end the year by closing above the $17,000.00 level to provide an average yearly return of 0.0%.
This technical analysis of the BTC/USD price showed a bullish D1 candle above the 20-day EMA, which is a primary indication of possible buying pressure in the coming days.
Moreover, the current high volume level for November is at 16,598.76, which is a sign of higher activity at a cheaper price.
Based on this price action, BTC/USD bullish trend continuation opportunity could extend the price towards the 19,000.00 level in the coming days. However, breaking below the 15,500.00 level with a daily candle could alter the current market structure and lower the price in the coming days.
- BTC/USD support level to look at: 15,500.00
- BTC/USD resistance level to look at: 19,000.00.
After the NFP, the US Dollar weakness is clearly visible as the recent data showed a mixed result for the Fed. Therefore, other major currencies except for the US Dollar could dominate the market before the FOMC.