The crypto market keeps recovering. Bitcoin has broken above $57,000. The way up to $60,000 is open now!
USD drops ahead of Fed meeting
- The US dollar keeps dipping further, while riskier assets are rising as investors await the FOMC meeting at 21:00 MT time. Most analysts expect that the central bank will increase its bond-buying program, which will push the USD down. On the flip side, the Fed may keep the status quo as the vaccine distribution has already started.
- The GBP surged without any progress in the Brexit deal. The EU-UK sides keep negotiating, that’s why there are still hopes that the agreement can be done soon.
- Gold has broken through $1 850 and keeps edging higher as the Fed is expected to ease policy, which in turn will lead to the weaker US dollar.
- The day will be full of economic releases! The most important releases are the EU PMI at 11:00 MT time, the UK PMI half an hour later, then US core retail sales at 15:30 MT time, and the US PMI at 16:45, and finally the last FOMC meeting this year at 21:00 MT time.
- How to trade PMI and retail sales? Compare actual numbers and forecasts. If actual numbers are better than forecasts, a currency will rise. If worse – a currency will drop.
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EUR/USD approaches the key resistance of 1.2170. It’s unlikely to cross it by the first attempt as it has failed to cross it several times. That’s why we can expect the price to pull back rather than break out. If it manages to break this level through, the way up to the next round number of 1.2200 will be clear. Support levels are at the 50-period moving average of 1.2130 and at the low of December 11 at 1.2110.
The pound is rising due to the weak USD. If it manages to break the key psychological mark of 1.3500, the doors towards the high of December 4 at 1.3545 will be open. On the flip side, if GBP/USD dips below the support of 1.3400, the way down to the next one of 1.3300 will be clear.
XAU/USD gets closer to the 50-day moving average of $1 870. The price will struggle to cross it, so we can await a retracement. If it breaks this level finally, gold may jump to the next resistance of $1 890. Support levels are at yesterday’s low of $1 825 and the 200-day moving average of $1 810.
USD/CAD is moving in a descending channel. If it crosses the support at yesterday’s low of 1.2700, the way down to the next round number of 1.2650 will be clear. Resistance levels are at the 50-period moving average of 1.2775 and 1.2820.
The US Inflation Rate (CPI) will be announced on Wednesday, October 13, at 15:30 MT (GMT+3). Traders eagerly await this event as it will impact the USD and thus the vast majority of currency pairs in the Forex market.
The upcoming CPI and the earnings season are the main events in the focus of traders next week. Check out more!
The bullish movement in the stock market is gaining speed, and Bitcoin ETFs are closer than they might seem. What do we need to know for the next trading week?
The Fed is ready to start tapering in November. Since the markets were expecting this and it wasn’t a surprise, the USD slumped allowing risk-on currencies and gold to rally up.
US Retail Sales will be out on October 15 at 15:30 MetaTrader time (GMT+3).