Daily Elliott Waves Forecast: NASDAQ, WTI, CABLE (14.06.22)

The Nasdaq index is near to completing a 5-wave structure, which might be the end of wave (5) or the beginning! As we are currently in wave 4, the correction’s completion is expected to finalize the downward leg. Will we then see a reversal or just relief?

Crude oil prices have remained somewhat unchanged but based up regardless of the corrective structure. It seems the diagonal is very likely, we just need to be patient and see if it pans out as a leading or ending. For now, we’re still mixed, but a top is expected to be in soon.

Pound has a similar downward leg to ND but it’s a more clear bearish impulse. Since a 4th wave is expected to offer a short-term bearish opportunity, the low is kind of expected to be in soon as well. The question is where do the markets turn for the correction in primary four? Some levels revealed!

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Daily Elliott Wave Forecast: NASDAQ, WTI, GBPUSD (17.05.22)

NASDAQ stopped at a Fibonacci cluster and reversed after forming a 5-wave leg downward. Can this turn into a full-blown reversal or only a short-term correction?

OIL completed the flat pattern expected and started to move higher in its 3rd wave. Without breaking the base channel, however, it could easily turn into a double three, albeit unlikely.

The British pound has likely completed its 5th wave in (3) and corrects in (4) unless the 5th turns into an ending diagonal instead. According to guidelines, a double four could be seen.

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Top Market Opportunities 25.04.2022 – 01.05.2022

This week we will get releases on the US and EU GDP figures, inflation data from EU countries, and the bank of Japan’s central banking meeting.

Last week’s corporate earnings was badly performed by Netflix. There is now concern on whether Meta, Alphabet and Amazon will be able to beat expectations this week as IMF cut growth forecasts.

BOJ to hold

Japan’s Bank is expected to keep its policy unchanged on April 28 – likely maintaining rates at -0.10% and its QQE with yield curve control to flexibly target 10yr JGB yields at 0.0%. Most analyst will still focus on the Fed meeting on May where a 50bps rate hike is expected along with the start of QT.

Traders will be attentive to any possible changes in growth and inflation forecasts though due to effects from the Ukrainian war.

NZDJPY reversed at 87.32 last week, and broke the 85 level following divergence signals from both the RSI and MACD indicators. 84.25 is the near-term support should the decend continues. However, a bounce could be seen there. If traders are caught by a surprise, 82.53 is a major support. On the flip side. Interim 5esistance to the top lies at 86.30, Friday’s open.

Fed gets PCE

United States’ GDP is expected to show that the rate of economic growth slowed in the first quarter to 1% percent on Thursday. However consumer spending is expected to remain strong as both business investment and residential investment are expected to continue improving.

The Fed’s favorite inflation indicator is expected to show that prices are increasing by 3% in March. While the annual rate is only rising by 0.6%, this is not much less than what analysts predicted. The Fed uses the March report as an estimate of how inflation will change during the next month.

AUDUSD has been weakening since the 76.6c top a couple of weeks ago, finding golden support near 0.7230 after the indicators printed bearish divergence. Due to its bearishness, it is more likely it reaches 0.71 than 0.7363 (last Friday’s open) now, however, support can be observed at 0.72 too. Breaking 71c might lead prices below the 70c. Although unlikely, upward price action exposes resistance at 0.7458 as well.

EU inflation unstoppable

On Friday, Eurozone Q1 GDP will be updated in addition to Germany’s flash Q1 GDP figures. Q1 has been closely watched because of the spillover effects from the Russia-Ukraine conflict. March PMI data showed that growth continued at a slow pace even as business sentiment slumped and prices on average rose.

In addition, CPI figures will be provided. Inflation March data saw HICP soar to 7.4% from 5.9%, driven primarily by surging energy prices. Furthermore, pressure was also seen in the core reading following a pick-up in goods and services. Food prices will also contribute largely to the headline inflation rate.

DAX reached a critical support at 14k and could see a relief rally up to 14371 – the 23.6% Fibo retracement. Above there, 14589 is the next resistance. However, losing 14k will likely take the index to 13884, and if that gives in, the 50% Fibo can be marked as the next big support. Both indicators look bearish as the RSI is below its 50% and the MACD has pulled of a crossover.

Big 4 Report

The top 4 biggest companies by market capitalization are due to report earnings during week in the S&P 500 index. The latest earnings report comes amid increased fears the economy will take a turn for the worse due to the uncertainties of raised rates and inflation.

NASDAQ has reached the 61.8% Fibo extension at 13344, and if proven to be a false break, traders might see a relief rally towards 13471, 631 or even 14k if bulls make a decent attempt to recapture the round level. Should they let prices slide, however, the index risks to plummet down to 13k. Will this be easy, though, given the indicators are somewhat oversold?

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Daily Elliott Waves: NASDAQ, USDCHF, PLATINUM (08.04.22)

NASDAQ formed an indecision bar on the daily chart after correcting to 14300. This is consistent with a larger correction in wave (B) as an ABC structure is expected to print. Is wave A of (B) complete though?

The Swiss franc weakened for a fifth consecutive day against the dollar on Thursday, supporting the bullish case. Is this the beginning of wave (3) or a simple correction leg that is part of the wider correction in wave (2)?

The prices of platinum are down for the week but yesterday’s price action provided a reversal formation. Is this because it printed wave 2 of the expected leading diagonal or only a short-term move that will turn lower in wave (C)?

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Daily Elliott Wave Forecast: NASDAQ, GOLD, NATURAL GAS (08.03.22)

NASDAQ trades 4.35% lower so far this week, and its structure remains downwardly impulsive. Despite wave (5) forming an ending diagonal, correcting higher is possible as part of its final bearish zigzag in wave 5.

GOLD rose 2.60% in today’s session already, summing up its 22 gains to nearly ~15% and counting. It seems that the commodity exposes some exhaustion at highs, though, and a reversal could be seen soon. Are we really still in a wave (X) correction?

Natural GAS lost nearly 10% this week already, making the impulsive upward structure harder to form. Its formation brings several variations at play now, as it consolidates between $4 and $5. What will it end up being?

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Close up of stock charts

Top Market Opportunities 24.01.2022 – 28.01.2022

Deleveraging Event Continues Ahead of FOMC

Last week markets expected to major economic events in the US, however, this week is all about the Fed. On Wednesday, analysts expect the Fed to stay on ‘hold’ and reiterate Decembers’ guidance of 3 hikes this year. A signal for a March hike would support the dollar and send bleeding stocks to further declines. In addition, a more extensive and faster winding down of the Fed’s balance sheet, announced or hinted, would have a similar effect. The US reports its Q4 GDP too.

Tracking the prices of NASDAQ on the daily chart, the tech index has been under severe pressure since the swing failure on Dec 28. It has lost %14 of its value on policy and chip shortage narratives.

No further guidance or, in general, a dovish or neutral Fed would allow the index top pull off a decent relief rally towards the 15k hurdle, perhaps even higher. However, a hawkish surprise could prove detrimental for the US100 index as it flirts with major support at 14400. The RSI and MACD show a slight divergence, and this foretells short-sellers have been taking some profits off the table. Can it continue?

BoC Ready to Hike?

Also on the policy front this week, we expect the Bank of Canada to meet. Even though the Canadian dollar has probably priced in a hike as markets anticipate a 25bp rise, the performance of the USDCAD will depend on Fed’s decision too.

Should the bank indicate tightening of financial conditions, something embraced by BoC and could star this week, it could give loonie a further boost as their balance sheet would reduce. However, if they deliver only a hike and no shrinkage in reinvestments, this might offer an additional uptick on Frida’s reversal.

The USDCAD pair has formed a decent support at 1.2450, and the pricing-in of the hike has probably started to wane off. In that case, traders can expect 1.2664 to be the next target should 1.2545 gives in. On the flip side, if the Fed comes out shy on Wednesday, the loonie could see renewed momentum, and depending on where the Fed leaves the pair, the break of 1.2450 will be imminent. The following support would be around 1.2350.

Australian CPI Could Shift RBA Narrative

Australia will release its inflation numbers on Tuesday, and its well expected to remain above the 2-3% target range. The consensus amongst analysts lies at 3.2%.

The RBA has stayed somewhat behind in providing guidance and signals regarding bond purchases. However, this might end next month as Australia’s employment has gotten to levels to inform a strong case. Coupled with an uptick in inflation, the Q4 CPI release could prove pivotal for Aussie leading to the next meeting.

AUDUSD has not made a decent attempt to get past the 73 cents. Bulls were stopped, and markets reversed on Jan 13. If the 0.7125 support gives in, the pair can slide down to 0.71 next and even lower. But its driver will be a mix of their own Q4 CPI and expectation around Fed’s meeting on Wednesday.

A positive surprise might see upside pressure elevating. However, the move is not expected to lead to a break above 0.72 – at least not ahead of the FOMC.

RBNZ Waits for Quarterly Inflation

Neighboring New Zealand reports its quarterly inflation data too on Wednesday. Economists expect the CPI figures to fall to 1.3%, suggesting that RBNZ has been guiding policy just right so far as it cut rates twice last year. Far from the bank’s 2% average target, a spike in inflation diverging from expectations could be the catalyst for another hike as it would prove inflation is not transitory.

Such an event can be two-fold for the kiwi. Beating expectations would guide RBNZ to another hike, allowing the NZ dollar to gain against counterparts. However, it would take away confidence in the central bank’s ability to keep inflation in check, especially after hiking twice.

Similar to the rest, the performance of NZDUSD will depend primarily on Fed, then on what the inflation numbers can tell markets. If NZ’s CPI disappoints, already at major support at 0.67, a somewhat hawkish FOMC could send the pair searching for the next Fibonacci at 0.6473. If Fed disappoints and the CPI comes out as expected, kiwi might experience a relief rally up to 0.6732.

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Top Market Opportunities 06.12.2021 – 10.12.2021

All Eyes on Friday’s CPI Since Fed’s U-Turn

As the new virus continues to raise uncertainty for global economies Fed’s Chair decided to shift the rhetoric from transitory to hawkish, indicating that the committee’s focus has shifted from growth concerns to inflationary pressures.

Powell’s hawkish message was detrimental for stocks as he hinted at earlier tapering on expected supply shortages, most notably for technology stocks in the NASDAQ index, as it plummeted 5 percent last week.

Despite last Friday’s payroll numbers printing worse than expected figures, the Fed seems determined to push ahead before a full recovery as it expects the impact of Omicron to prove more problematic for inflation than for growth.

With “transitory” no more, markets will hang on how the situation around the new variant develops in the US up until the end of the week on Friday, where inflation data will give an idea of how sooner the Fed might start tapering.

As recent data suggest, if the variant proves less worrisome, the index could consolidate between the 38 and 50 Fibonacci retracements at 15865 and 15578 until further clarity on the US CPI. However, if markets panic on Omicron getting out of hand, or should new data indicate it’s a worse variant than Delta, then panic selling might continue, bringing the index down to 15291.

Forex analysis | Amega

RBA to Hold But Statement Mihgt Hint at Tapper

Uncertainty around Omicron impacted and is likely to continue impacting risk-sensitive currencies such as the Aussie and the Canadian dollar. Although markets expect both currencies to remain under pressure amidst recent outflows, the reality is that investors wait for the last monetary policy meetings of the year for both RBA and BoC.

The RBA is not close to even thinking about hiking at this stage. However, recent concerns about the bank’s stake in the bonds markets hint at a potential word on a taper.

Aussie might slip away from bearish sentiment if the bank delivers such a signal after the meeting. If not, this will likely reinforce the bearish narrative, especially against the euro, as inflation there increased beyond ECB’s target.

Aussie losing 1.62 versus the euro might find resistance at 1.64 next. Contrary, if the former finds strength in RBA’s statement, EURAUD could lose the 1.60 round support and head towards 1.5850.

Forex analysis | Amega

BoC Likely to Remain Hawkish as Inflation Keeps Rising

The central bank of Canada, On the other hand, has kept a relatively hawkish stance since October’s meeting, where they signaled a hike in early Q2 2022.

Considering last Friday’s jobs numbers, BoC might indeed be the second bank to raise after RBNZ. However, whether the bank sticks to hawkish guidance or not will also depend on oil demand, which continues to decline.

With rates unlikely to change during the Dec 8 meeting, USDCAD might see further upside towards the 1.2950 resistance running up to the year’s end. If BoC hints at no delays in the first hike, the pair might find support closer to 1.2726 and perhaps move lower to 1.2573.

Forex analysis | Amega

Natural Gas Impacted by Warm Weather

Oil prices crashing over the past few weeks did not find relief last week either as OPEC+ decided to continue pumping oil in the markets. Even though Thursday’s decision was a non-event, it has been well priced in as priced dumped up to $10 per barrel last week.

Natural gas did not manage to hold the support at $4 either, and it is currently under severe pressure as demand continues to decline on above-normal temperatures. As the weather is set to change mid-December, the gas price could find decent support at $3.32 by next week’s end. If it loses the level, the next support lies at $3.

Forex analysis | Amega

Until then, prices might consolidate ahead of the EIA report on Wednesday, where additional data will add to or remove from the weakness.

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