EUR/USD: The slippage continues, 1/1 is simply a matter of time?
(Vasilis Tsaprounis – TopFX)
European common currency traded below the 1.01 level on the last day of the week, sliding around 200 basis points during it.
The slightly bearish momentum has been maintained throughout the week and although there have been significant corrections the European currency is in worse position and is preparing to defend the level of 1/1.
The main data acting as a weighting for the European currency remain and do not appear to change in the very near future.
The difference in interest rates between the two central banks, the prospect of maintaining this difference and the worst position the European economy has been in because of the Ukraine War remain the main causes for pressures on the European currency.
As it is at the moment the main picture of the fundamental macroeconomic quantities, but also of the geopolitical situation these data will remain in the foreground for some time yet.
Nevertheless, as it was shown by the announcement of the data on the course of inflation in USA the previous week that worked as a trigger to decompress the exchange rate, any announcement or development that differs even slightly from the aforementioned will be capable of leading the euro to a significant correction.
For this reason we maintain our latest basic strategy of buying the Euro at new market dips.
XAU/USD: Impulse structure hints at higher levels
(Jing Ren – Orbex)
The internal XAUUSD structure suggests a global correction pattern, which takes the form of a cycle triple zigzag.
On the current chart, we see the structure of the bearish cycle intervening wave x, which looks completed in the form of a primary triple zigzag Ⓦ-Ⓧ-Ⓨ-Ⓧ-Ⓩ.
Perhaps, after the completion of the cycle wave x, the market turned around and began to move up. That is, the initial part of the cycle wave z is being built now. It can take the form of a primary standard zigzag Ⓐ-Ⓑ-Ⓒ, as shown in the chart.
The price of gold in the wave z may rise to the price mark of 1980.51. At that level, it will be at 76.4% of previous actionary wave y of the cycle degree.
In an alternative scenario, a continuation of the downward price movement in the cycle wave x is expected. Wave x is also a triple zigzag Ⓦ-Ⓧ-Ⓨ-Ⓧ-Ⓩ, but the final primary wave is still under development.
A downward movement of XAUUSD is expected in the near future. The primary wave Ⓩ may take the form of an intermediate zigzag (A)-(B)-(C).
The final of the correction pattern zigzag (A)-(B)-(C) is possible near 1566.77. At that level, it will be at 76.4% of primary wave Ⓨ.
After reaching this level, we can expect a market reversal and the beginning of a cycle wave z.