Weekly Technical Analysis – 31 January 2022 – Technical Analysis – Trading Q&A by Zerodha

[WEEKLY TECHNICAL ANALYSIS WITH CANDLESTICK CHARTS – 30 JANUARY 2022]

weekly shots

PMI Manufacturing, UK

When: What affected him:

January 24, 2022 Sterling Pounds and Subsequent Husbands

What happened: The Manufacturing Purchasing Managers’ Index (PMI) measures the activity level of purchasing managers in the manufacturing sector. A reading above 50 indicates expansion in this sector; Below 50 indicates deflation.

GBPAUD is trading in the upper channel. More upside could be seen in the coming week.

CB Consumer Confidence (January), US

When: What affected him:

Jan 25, 2022 US Dollars & Subsequent Husbands

What happened: Conference Board (CB) Consumer Confidence measures the level of consumer confidence in economic activity. It is a leading indicator as it can predict consumer spending, which plays a major role in overall economic activity. Higher readings indicate rising consumer optimism.

USDCAD is currently in an ascending channel. More upside could be seen in the coming week.

CPI (QoQ) (Q4), Australia

When: What affected him:

January 24, 2022 Australian dollars and subsequent pairs

What happened: The Consumer Price Index (CPI) measures the change in the prices of goods and services from the perspective of the consumer. It is a basic way of measuring changes in buying trends and inflation.

AUDCHF is currently in the downside channel. Further decline could be seen next week.

Gold is down 2% for the week and below $1800 due to the Fed’s long buying

What affected him:

gold

What happened: The two-week golden party proved to be exactly that: two weeks.

Bulls in the precious metal tried to stick to the $1,800 handle and reach $1,900 thereafter, seeing their hopes dashed by the Federal Reserve taking a chunk out of the gold market with its ultra-tight monetary policy to pull the US out of the worst inflation crisis in decades.

The most active gold futures contract on the New York Stock Exchange, April, settled down $8.40, or 0.5%, at $1,778.80 an ounce. Over the past two sessions, the price of gold futures has fallen by $60 in total. This led to a weekly loss for the contract of more than 2%, effectively erasing the consecutive gains made in the past two weeks.

The Federal Reserve this week unveiled a new hawkish era for US monetary policy, as Chairman Jerome Powell did not rule out the possibility that US interest rates will rise every month this year after the first increase of the pandemic era, possibly in March.

Gold was trading in the ascending channel. We will see more downside after the breach next week.

Oil reaches a 7-year peak due to political risks and supply crisis

What affected him:

Crude oil

What happened:

Oil prices rose to their highest level in more than seven years on Friday and posted their sixth consecutive weekly gain as geopolitical turmoil exacerbated concerns about tight energy supplies.

On a weekly basis, benchmark contracts made their longest winning streak since October. Brent crude futures rose 69 cents to settle at $90.03 a barrel, after reaching $91.70, the highest level since October 2014.

US crude closed up 21 cents at $86.82 a barrel, after hitting a seven-year high of $88.84 during the session.

Tight oil supplies pushed the six-month market structure for Brent crude to a sharp decline at $6.92 a barrel, the widest since 2013. The pullback occurs when near-term oil delivery contracts are priced higher than those of subsequent months, encouraging traders to release oil. From storage to sell it immediately.

WTI Crude Oil is trading in the ascending channel. More upside could be seen in the coming week.

Ethereum hashrate scores new ATH as PoS migration continues

What affected him:

Ethereum

What happened:

Over the past year, Ether (ETH) has increased in value so much that it has vastly outperformed Bitcoin (BTC) in terms of returns. The advent of Ethereum made mining on its network profitable over time. This appears to have resulted in additional miners, expanding the network’s hash rate.

Ethereum’s hash rate reached a new high, approaching record highs of 1.11 PH/s, according to data from Glassnodes on Thursday. The previous ATH was previously reached on January 13, when the price of ETH dropped from $4,460 to $3,160.

Ethereum is currently in the downside channel. Further decline could be seen next week.

5 major events to watch

PMI Manufacturing, UK

When: What affects it:

01 February 2022 GBP

Pairs

What is happening: The Manufacturing Purchasing Managers’ Index (PMI) measures the activity level of purchasing managers in the manufacturing sector. A reading above 50 indicates expansion in this sector; Below 50 indicates deflation.

A higher than expected reading should be considered positive/bullish for GBP, while a lower than expected reading should be considered negative/bearish for GBP.

Initial jobless claims, US

When: What affects it:

February 03, 2022 USD and beyond

Pairs

What is happening: Initial jobless claims measure the number of individuals who filed for unemployment insurance for the first time during the past week. This is the oldest US economic data, but the market impact varies from week to week.

A higher than expected reading should be considered negative/bearish for the USD, while a lower than expected reading should be considered positive/bullish for the USD.

Unemployment Change (January), Germany

When: What affects it:

February 1, 2022 Euro ff

Pairs

What is happening: German Unemployment Change measures the change in the number of unemployed during the previous month.

A higher than expected reading should be considered negative/bearish for the EUR, while a lower than expected reading should be considered positive/bullish for the EUR.

RBA Rate Decision (Feb), Australia

When: What affects it:

January 31, 2022 AUD et seq.

Pairs

What is happening: Members of the Board of Directors of the Reserve Bank of Australia (RBA) have reached a consensus on where to set the rate. Traders keep a close eye on interest rate changes as short-term interest rates are the primary factor in currency valuation.

A higher than expected reading should be considered as positive/bullish for the AUD, while a lower than expected reading should be considered as negative/bearish for the AUD.

GDP (MoM) (November), Canada

When: What affects it:

01 February 2022 Canadian Dollars and Beyond

Pairs

What is happening: Gross Domestic Product (GDP) measures the annual change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of an economy’s health. Canada releases new GDP data on a monthly basis.

A higher than expected reading should be considered positive/bullish for the Canadian dollar, while a lower than expected reading should be considered negative/bearish for the Canadian dollar.

property rights next week

  1. ExxonMobil (XOM) To announce its quarterly results on February 01, 2022, earnings per share were estimated at $1.89 billion while revenue was estimated at $85.01 billion.

  2. PayPal Holdings Inc (PYPL) To announce its quarterly results on February 01, 2022, EPS was estimated at 1.12 per share while revenue was estimated at 6.9 billion.

3 **. Meta Platforms (FB) ** to announce its quarterly results on February 02, 2022, EPS is estimated at 3.85 per share while revenue is estimated at 33.35 billion.

  1. Honeywell (HON) To announce its quarterly results on February 03, 2022, earnings per share were estimated at 2.08 per share while revenue was estimated at 8.74 billion.

  2. Carlsberg AS (CABGY) To announce its quarterly results on February 04, 2022, earnings per share were estimated at 0.2878 per share while revenue was estimated at 2.24 billion.

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