2023 Market Forecast by Solid ECN

[SOLID ECN LLC]

Gold Prices Climb as Investors Eye Fed Moves​

Solid ECN—Gold prices rose to approximately $2,313 per ounce this Monday. This increase came after a drop in the last session. Throughout this week, investors are keenly observing a range of economic updates and statements from Federal Reserve officials. These observations will help them understand when the Fed might reduce interest rates.

Essential data on US retail sales will be released today. Additionally, this week will feature updates on weekly jobless claims and Friday's flash purchasing managers' indices. These reports are crucial as they provide insights into consumer spending and the overall economic health.

Philadelphia Fed President Patrick Harker mentioned on Monday that, based on economic forecasts, the Fed may cut its benchmark rate once this year. Traders await further comments from other Fed officials, like New York Fed President John Williams and Richmond Fed President Tom Barkin.​

 

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Eastern Tensions and Market Forces Propel Oil Futures​

Solid ECN—On Wednesday, WTI crude futures maintained a price of around $80.3 per barrel, their highest in seven weeks. This spike is due to increasing conflicts in Eastern Europe and the Middle East, which have raised concerns over oil supply disruptions.

A Ukrainian drone attack recently set an oil terminal ablaze in a key Russian port. Concurrently, tensions escalate as a senior Israeli official predicts a looming full-scale conflict with Hezbollah in Lebanon. Furthermore, oil prices gained support from strong global demand projections for the latter half of the year by entities like OPEC, the IEA, and the US EIA. Key OPEC+ nations, including Russia and Iraq, continue to stick to their production limits.

Additionally, Saudi Arabia has expressed readiness to adjust its oil output depending on market needs. In contrast, recent data indicates a rise in US crude stocks by 2.264 million barrels last week, contrary to the anticipated decrease.​

 

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Gold Prices Steady Amid Economic Slowdown​

Solid ECN—On Thursday, gold prices were stable at around $2,330 per ounce due to weak US economic data, raising hopes that the Federal Reserve might lower interest rates soon. Recent figures indicate that US retail sales have stagnated, reflecting a decline in consumer enthusiasm.

This spending slowdown, combined with less tension in the labor and price sectors, has led the Federal Reserve to wait for more evidence of diminishing inflation before potentially reducing interest rates later this year. Austan Goolsbee, President of the Chicago Fed, praised Tuesday's latest consumer price inflation figures as "excellent" and remained hopeful about continued easing inflation.

Investors are now looking forward to this week's jobless claims and the upcoming purchasing managers' indexes on Friday to gain further insight into consumer behavior and overall economic health.​

 

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MACD Signals Potential Shift for EUR/USD Pair​

Solid ECN—The EUR/USD currency pair is correcting some of its losses from Friday. The MACD indicator shows divergence, suggesting the market might enter a consolidation phase or experience a trend reversal. Currently, the pair is in a downtrend, trading within a bearish channel and below the Ichimoku cloud. Due to the MACD's divergence, the price might rise to test the upper band of the channel and the key resistance level at 1.076.

The price must stay below the critical resistance level of 1.066 for the downtrend to continue. If this happens, the key resistance level 1.066 will likely be tested again.

However, if the price breaks above 1.076, the upward momentum from 1.066 could aim for the 1.078 resistance level.​

 

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GBP/USD Pullback: Key Levels to Watch​

Solid ECN—The GBP/USD currency pair fell below 1.267 on June 20. Currently, the pair is trading around 1.265, pulling back from June's all-time low of 1.262. The DeMarker indicator predicted this pullback, as it hovers below the 0.3 line, indicating oversold conditions.

The immediate resistance level is at the 23.6% Fibonacci retracement level, the 1.267 mark. If the bulls push the price above this level, it could rise to test the 75-period simple moving average on the 4-hour chart, a level supported by the Ichimoku Cloud.

On the downside, the price must stay below the cloud for the downtrend to continue. Additionally, the U.S. dollar must fall below the immediate support level of 1.262 against the pound sterling.​

 

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AUD/USD Bullish Momentum Strengthens​

Solid ECN—The AUD/USD pair is trading above the 50% Fibonacci level at approximately 0.664 in today's session. The pullback from 0.662 was anticipated, given that the Demarker indicator was in the oversold territory, and the market formed a long-wick bullish candlestick pattern on the 4-hour chart. The RVI lines show a bullish cross; the indicator's value rises while the MACD is above the zero line. This suggests bullish momentum is gaining strength, and the AUD/USD price will likely increase.

From a technical standpoint, the bullish trend remains valid if the pair stays above the ascending trendline and the Ichimoku cloud. Given this outlook, the next bullish target could be the 78.6% Fibonacci level at 0.667. Furthermore, if the price exceeds this level, the next resistance will be the June high at 0.670.

Conversely, a dip below the key resistance level at 0.6623 will ignite new selling pressure, which could extend the price to the 23.6% Fibonacci level at 0.660.​

 

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USD/JPY Bullish Trend Amid Overbought Signal​

Solid ECN—The USD/JPY market appears overpriced, with the DeMarker indicator indicating overbought conditions. Today, the bears tested the upper boundary of the previously broken bullish channel. As of now, the price has bounced back, currently trading around 159.7.

The RVI and MACD indicators suggest that the bull market remains strong. The immediate resistance level is at 160.23. If the price surpasses this level, it will likely pave the way for the bulls to reach 165.0. However, entering a long position in an overbought market is not advisable.

We recommend waiting patiently for the price to test lower resistance levels, such as 158.2. This demand area provides a favorable bid price for traders and investors looking to join the bullish trend.​

 

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EUR/USD Update: Bullish Targets in Sight as Price Stabilizes​

Solid ECN—The EUR/USD currency pair stabilizes above the broken descending trendline in the 4-hour chart. However, the price remains below the key resistance level at 1.076, indicating that the primary trend is still bearish.

Technical indicators suggest that the upward momentum starting from 1.066 will likely continue, possibly targeting the 50-period simple moving average (red line). That said, if the price stays above the immediate support at 1.070, it could test the key resistance at 1.076. Should buying pressure surpass this level, the next bullish target will be the 100-period simple moving average (blue line).

Please note that a dip below the immediate support at 1.070 could trigger a resumption of the downtrend. If this occurs, the price will initially test the 1.066 level, driven by sellers.​

 

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GBP/USD: Bullish Momentum and Key Support Level​

Solid ECN—The GBP/USD currency pair is testing significant technical levels, including the 50-period simple moving average, resistance near the 38.2% Fibonacci retracement level, and the Ichimoku cloud. Technical indicators suggest the bullish market may prevail, but the primary trend remains bearish as the price is below the Ichimoku Cloud.

The key support level to maintain the bullish outlook is 1.267, the 23.6% Fibonacci retracement. As long as buyers keep the exchange rate above this level, the price could rise to test the 38.2% Fibonacci level. Furthermore, if buying pressure pushes the price above 1.271, the bullish wave that began at 1.262 could target the 50% Fibonacci level at 1.273.

Conversely, if the GBP/USD price falls below the 1.267 support, the primary bearish trend will likely resume, potentially targeting June's all-time low at 1.262.​

 

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AUD/USD Faces Bearish Pressure​

The AUD/USD currency pair has declined from the descending trendline, which indicates a bearish momentum as expected due to a long wick candlestick pattern forming on the 4-hour chart. The MACD indicator is approaching the zero line and is about to cross below it, signaling that the bearish momentum may continue.

From a technical perspective, if the price crosses and stabilizes below the 50% Fibonacci level, the next bearish target will be 0.662, followed by 0.660. The descending trendline acts as resistance in this bearish scenario. This bearish analysis will be invalidated if the AUD/USD price exceeds the trendline.​