It is like winter is not coming for the US economy, most particularly in the labor market, which showed another job increase in the last. The increase of 263K was above the 250K analysts' projection.
However, a negative figure in the job market is needed for the Fed to stay back from the rapid rate increase. Overall, stock bulls and dollar bears need the NFP to come below 100K, which could be the primary indication of the rate cut. As of now, market participants could see another rate in the coming FOMC, as the September data suggests.
Forex Technical Outlook for 10 October 2022 to 14 October 2022
After the Non-farm payroll, investors will see the inflation report this week, where any sign of recovery would be a bearish factor for the overbought US Dollar. Moreover, the US retail sales and the UK GDP could provide further indications about the global economy.
Let’s see the important events from this week:
- The UK GDP m/m on Wednesday
- The US PPI m/m on Wednesday
- The US CPI m/m on Thursday
- The US Retail Sales m/m on Friday
- Prelim UoM Consumer Sentiment On Friday
Before moving to the forex outlook for 10 October 2022 to 14 October 2022, let’s see what is happening on the US Dollar index:
The US Dollar index (DXY) recovered from the loss by making the 110.00 level a solid bottom. Moreover, the bullish reversal from the 20 DMA within the broader bullish trend offers a bullish continuation pattern for the DXY.
Therefore, the upside pressure in the US Dollar index is valid until bears take the price below the 110.00 level with a daily candle close.
As per the previous EUR/USD weekly outlook, a bullish recovery and an immediate two-bar rejection from the 0.9900 area opened a bearish opportunity and ended up with more than 150 pips of gains toward the downside.
Last week, bulls became aggressive in the market by taking the price above the 20-day Exponential Moving Average but failed to maintain momentum. The biggest reason for the failure is the potential demand zone of 1.1049 to 0.9976, where intraday rejection appeared.
The fixed range high volume indicator remained unchanged at 0.9993, a strong resistance level. The indicator window shows a neutral momentum in this pair as the current RSI level hovers at 50%.
The bull case for EUR/USD should come with strong momentum as the immediate demand zone, and trendline resistance should be violated by making a swing high. In that case, a strong buying pressure above the 1.0050 area would extend the momentum toward the 1.0386 level.
On the other hand, the broader market trend is still bearish, where the recent daily candle is below the 20 DMA. In that case, the ideal trading approach for 10 October 2022 to 14 October 2022 will be to find a bearish opportunity in the intraday chart, targeting 0.9600 as a target level.
- EUR/USD support levels to look at: 0.9855, 1.0050
- EUR/USD resistance levels to look at: 0.9534
GBP/USD showed a similar price action to EUR/USD, where a strong bullish recovery came at the beginning of the week but reversed immediately with a simple candlestick rejection. The best part of GBPUSD is its new swing formation, creating a new supply zone for the coming days.
This technical analysis shows how the bulls failed to hold the price above the strong visible range high volume level at 1.1368. Therefore, the bearish two-bar reversal created a trend trading opportunity this week where any intraday bearish formation could be a short opportunity.
The dynamic 20-day EMA is above the price, while the selling pressure is backed by a potential supply zone and fixed range high volume level. On the other hand, the Relative Strength Index (RSI) is still below the 50% level, providing a neutral opinion about the market pressure.
Based on the current price prediction, the primary approach is to find a trend trading opportunity, targeting the 1.0763 level. In that case, intraday bearish rejection from the near-term resistance level is needed. On the other hand, the alternative approach is to wait for the price to break the 1.1500 level with a daily close before aiming for the 1.2290 level.
- GBP/USD Levels to look at: 1.0763
- GBP/USD levels to look at: 1.1500
AUD/USD price action remained corrective within a rectangle pattern, where a bearish pattern breakout could offer a trend trading opportunity.
This technical analysis of the AUD/USD daily chart indicates a corrective price action backed by a strong bearish trend. Moreover, the dynamic 20 DMA is above the 0.6546 horizontal resistance level and sloping down. On the other hand, RSI is still bearish, below the 50.00 level.
Based on the AUD/USD price prediction, a bearish daily close below the rectangle range could extend the bearish pressure to the 0.6257 support level.
On the other hand, bulls should wait for the price to exceed the 0.6546 resistance level before aiming for the 0.6900 area as a target level.
- AUD/USD support levels to look at: 0.6363 & 0.6257
- AUD/USD resistance levels to look at: 0.6546
It's like there is no one to stop the USD/JPY price from reaching the 148.00 level. Despite several intraday swing lows, the price continued pushing higher, which could extend the loss for JPY bulls.
This technical analysis indicates a strong bullish daily trend for the USD/JPY price, where the strong bullish recovery above the 144.16 level increased the bullish possibility.
Based on the fixed range high volume indicator from the September high to the low, the bullish daily candle is above the 144.58 level and is more likely to extend the bullish pressure in the coming days.
The dynamic 20 DMA is steadily up below the price while the RSI is preparing for another attempt to reach the overbought 70% area. In that case, any intraday bullish opportunity could extend the buying momentum toward the 148.00 area.
On the other hand, breaking below the 143.00 level could increase the volatility in the market before showing further clues about moving to the 138.00 level.
- USD/JPY support areas to look at: 144.16
- USD/JPY Resistance levels to focus: 148.00
The bullish pressure in the XAU/USD price was extended throughout the week as the weaker US Dollar assured investors that the Fed reached the Pivot level on raising interest rates.
This technical indicates the daily candlestick price of XAU/USD, where the current price is above the near-term event level of 1687.53. Therefore, the primary approach is to find the bullish opportunity above the 1687.00 level towards the target of the 1734.65 level.
The fixed range high volume indicator is below the price, which indicates institutional traders' interest in XAU/USD bulls. Moreover, the dynamic 20 DMA is below the price while the RSI is steady above the 50% neutral zone.
Based on the current XAU/USD price condition, a buying pressure is valid as long as the price trades above the 1662.49 high volume level. However, breaking below the 1660.00 level with a daily close might invalidate the bullish opportunity by opening rooms to test the 1615.14 level.
- XAU/USD support level to look at: 1662.49
- XAU/USD resistance levels to look at: 1734.65.
Bitcoin price remains above the high trading volume level for 2022, which is 19,157.00 level. Therefore, the primary approach in the BTC/USD pair is to find a bullish trading opportunity above this level, where the breakdown could extend the selling pressure to the 15,551.00 support level.
On the other hand, the realized price for the Bitcoin whale investment, holding more than 1,000 BTC in the wallet, is priced at the $15,800.00 level. In that case, the current descending channel extension has a higher possibility of taking the price to the 15,800.00 level to complete the deeper correction.
This technical analysis shows the possible selling pressure in the BTC price, where the main barrier is the visible range high volume level, which needs to be overcome.
The dynamic 20 EMA moved above the price while the RSI level rebounded at the 50% area. These indicators offer a bearish opportunity in this pair, where a new daily candle below the channel support would increase the bearish opportunity.
On the other hand, a strong bullish recovery and a daily close above the 20,376.00 level are needed to go long, targeting the 22,742.43 level.
- BTC/USD support level to look at: 19,021.30 & 15,800.00
- BTC/USD resistance level to look at: 20,376.14
The bullish recovery in the US Dollar index and the upbeat Non-farm payroll data could extend the USD bulls against the basket of currencies. However, the Consumer price index would be the main data this week which could reverse the current sentiment at any time.