Last week's data supports a second-half recession. The LEI continues to decline, indicating labor market weakness. Home data also shows that the home market is far from recovering.
According to analysts, one more quarter-point rate hike may come at the May 3 FOMC meeting as the most rapid policy tightening since the early 1980s winds down. However, the Fed might hold until the fourth quarter. Without the banking crisis, there may have been more rate hikes. Given current banking sector issues, we do not need further hikes beyond May.
On Wednesday, the Federal Reserve released its March–April Beige Book. Silicon Valley Bank and Signature Bank failures rendered the March Beige Book obsolete. The current edition addresses the financial crisis and its aftermath.
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Forex Technical Outlook for 24 April 2023 to 28 April 2023
The upcoming trading days will be light as the economic calendar is muted for some major economies. However, several factors might drive the market as shown in the list below:
- CB Consumer Confidence on Tuesday
- AUD CPI on Wednesday
- The US Advance GDP q/q on Wednesday
- BOJ Outlook Report & Monetary Policy Report on Friday
- German Prelim CPI m/m on Friday
- The US Core PCE Price Index m/m on Friday
Now move to the weekly price forecast:
EUR/USD bullish tres remained intact, as shown in the previous weekly outlook, where a minor rebound opened a long opportunity in the daily chart. This week, the sentiment could remain unchanged, and bulls may extend the momentum until the monthly close approaches.
This technical analysis indicates the daily price of EUR/USD, where the broader market trend is bullish. The latest weekly candle closed with an inside bar formation within the large bullish weekly close. It is a sign that the minor recovery is over, and a long-term bullish trend may resume.
The daily chart carries the price by the 20-day Exponential Moving Average, where the 100 SMA is below the price. It is a sign of a valid trend where any minor bullish rejection in the intraday chart could resume the broader trend.
According to the Visible Range High Volume Indicator, the largest volume level has been seen at 1.0902 level since 15 March 2023. Moreover, the current Relative Strength Index (RSI) is stable above the 50% level.
Based on this outlook, investors might expect a bullish trend continuation opportunity in the daily chart of EUR/USD, targeting the 1.1076 level. However, a break below the 1.0902 level with a bearish daily candle could alter the current market structure at any time.
GBP/USD passed a volatile week as several violations were seen below or above intraday swing levels. However, the broader bullish trend is still intact, and bulls may regain momentum at any time.
This technical analysis shows a bullish trend in the GBP/USD price, which is trending up from left to right. Therefore, the primary intention for trading this pair would be to look for long opportunities until significant selling pressure exists.
Institutional investors’ sentiment is mixed for this pair as the current Visible Range High Volume indicator shows that the most active level is 1.2423. Therefore, a bullish daily candle above the high volume level would increase the bullishness in the market at any time.
In the main chart, the dynamic 20-day EMA carries the price within a potential bullish pre-breakout structure. Moreover, the Relative Strength Index (RSI) shows a downward pressure but remains above the 50.00 neutral line.
Based on this outlook, investors need additional confirmation from the intraday price before opening a long position. The ideal approach is to find the price above the 1.2423 high volume level before aiming for the 1.2546 level.
On the other hand, a downside possibility is valid if the daily price comes below the 1.2344 level, which will open room for testing the 1.2277 support level.
AUD/USD trades within a consolidation, where the broader market outlook is bearish. Although the situation is inverse with EUR/USD and GBP/USD, the downside momentum is solid.
This technical analysis represents the daily price of AUD/USD, where the latest weekly candle closed with a bearish momentum. In the last 4 weekly candles, sufficient selling pressures are visible due to long wicks on the upside.
In the daily price, the current consolidation increases the possibility of a liquidity grab either from above or below the current zone. The high volume level since 15 March 2023 is spotted at 0.6700, near the current price. It is another sign of a consolidation, which can end up with a liquidity sweep before forming a stable trend.
In the main chart, the dynamic 20 EMA is closer to the price with multiple violations, while the current RSI is below the 50.00 level with downside pressure.
Based on this outlook, downside pressure may come in the AUDUSD price, where the primary target is to test the 0.6564 support level. However, a bullish pressure with a daily candle above the 0.6771 level might alter the current situation and increase the price towards the 0.6900 area.
USD/JPY maintained a solid bullish momentum throughout the week, which can extend the momentum this week. Therefore, the primary intention for this instrument is to look for long trades only until there is strong bearish exhaustion.
This technical analysis of USD/JPY indicates an emerging bullish trend as the current price increases from the near-term support level.
The high volume level since 15 March indicates a bullish market as it remains below the current price. Moreover, the dynamic 20 EMA carries a bullish trend where bulls could make a new swing high anytime.
In the indicator window, the current Relative Strength Index (RSI) is above the 50.00 line, which could test the 70.00 line anytime.
Based on the weekly forecast for USD/JPY, bulls could resume the existing trend, where the main aim is to test the 156.91 level. However, breaking below the 132.51 high volume level with a bearish D1 candle could eliminate the bullish structure at any time.
XAU/USD remained sideways throughout the week, where a strong breakout is needed before offering a trading opportunity. As the existing momentum is bullish and the demand for Gold is solid due to the recession, an upside pressure may come at any time.
This technical analysis shows the daily price of XAU/USD, where the current price is trading sideways. The weekly price shows a bearish candle followed by an indecision with a buy-side liquidity grab. It is a primary sign of a strong trend reversal where at least one lower low is needed below the 1950.00 level.
Moreover, the current high volume level is closer to the price, with a bearish daily candle below the dynamic 20-day EMA. As the recent trading zone is backed by consolidation, a strong breakout could result in an impulsive trend.
Based on the current price behavior, the bullish trends are still valid, and a daily candle above the 2010.00 level could resume the trend toward the 2060.00 level. However, a valid break below the 1950.00 level could limit the buying pressure at any time.
According to IntoTheBlock's Global In/Out of the Money (GIOM) model, Bitcoin's northbound advance is not crowded. 4.77 million addresses that accumulated 1.95 million BTC at an average price of 39,332.00 are underwater. Unlike the smaller initial group, the second group of "Out of the Money" holders may sell and construct a local top formation.
However, the support cluster from 23,039.00 to 28,107.00 is encouraging for the long-term bullish thesis for Bitcoin since approximately 3.7 million addresses bought 1.86 million BTC at an average price of 25,433.00; they are likely to accumulate more if the price decreases.
The Daily Active Addresses (DAA) indicator, which has been above 1 million since January 2023, is positive but should not be utilized alone. Another important statistic for identifying smart money investors is the Whale Transaction Count. The exceptionally large whale transaction count and DAA jump on April 11 reflect a continuing gloomy outlook.
After the April 20 crash, wallets holding 1,000 to 10,000 BTC dumped their stash, according to the Supply Distribution chart. The data isn't enough to determine Bitcoin's direction, but if the second type of investors begins accumulating, it might indicate an optimistic perspective from long-term holders.
BTC/USDT price has moved below the high volume level since 10 March 2023. It is an alarming sign for bulls as a new daily candle close below the 27,400.00 level could open a short opportunity.
The price already trades below the 20-day EMA, while the current RSI is below the 50% neutral level.
Based on the current price behavior, investors should wait for a bullish rebound with a daily close above the 29,600.00 level before opening a long position targeting the 31,000.00 level.
The coming trading days might be lighter compared to the previous week as no significant releases will come from major economies.