Indices fall on valuations, AI, NFP – Trading USD/CAD, Crude [Video]

Brad Alexander FX Large Limited

In today’s GCI Market Outlook, let’s take a look at Forex Trading on USDCAD, WTI Crude Oil, Gold, XAU/USD, Silver, XAG/USD, Bitcoin, BTC/USD, the DAX40, the S&P500, and on the NASDAQ.

Everything went against investors’ confidence yesterday, and we saw a big sell-off.

And it wasn’t just the Indices, either.

Let’s look at the US Indices first.

We are seeing a perfect storm of uncertainty about company valuations and fears of an AI bubble, higher US inflation, a bad NFP and unemployment rate, combined with the fact that the US shutdown means that we have to completely skip the October jobs report.

So, if we see confidence returning soon, we could see a lot of dip-buying, but let’s look at the technicals.

On the NASDAQ daily chart, we see the stochastic oscillator oversold but the MACD is thinking about being bearish.

Zooming out to the 4-hour chart, we see the current downtrend and a very oversold stochastic oscillator.

If you are a fan of MACD, you may want to wait until the signal line passes out of the histogram before looking at a long on the NASDAQ or any of the indices.

We could look at every index around the globe and we could see the same thing.

Price action on the DAX has broken out of its range and has returned to levels from April with similar technicals.

But please be aware that the chaos in the current US administration cannot be ignored.

Watch for volatility!

Speaking of which, Bitcoin has fallen to April prices as well, with the current level of $85,600.

Again, many fundamental factors have affected this sell-off, so be careful if you are looking at a long crypto position.

Last time we spotted possible double tops on gold and silver, and we see price action falling on both towards support.

Let’s keep an eye on these.

As we have mentioned many times, the downtrend in WTI crude oil and Brent continues, and we see support at $57 on WTI.

This has negatively impacted CAD, but we will look at possible reversals on CAD pairs like USDCAD next week.

Author

Brad Alexander

FX Large Limited

Brad became fascinated with the Currency Markets from a young age and researched fundamental analysis.

AUD/USD consolidates near 0.7000 as USD stays weak

AUD/USD holds steady above 0.7000 during Thursday’s Asian session, consolidating the previous day’s recovery gains from a near three-week low as the Democratic sweep in the US midterm elections and Iran diplomacy hopes continue to weigh on the US Dollar. Bulls, however, seem hesitant as focus shifts to Friday’s crucial US NFP report.

USD/JPY drifts lower to 158.25 on hawkish BoJ Minutes, weak USD

USD/JPY trades with a negative bias for the second straight day on Thursday as hawkish BoJ Minutes, showing members agreed to keep raising rates, and intervention risks support the Japanese Yen. Meanwhile, US midterm election results and hopes for Iran diplomacy keep the US Dollar depressed as focus shifts to Friday’s US NFP report.

Gold consolidates gains around $4,100

Gold now surrenders part of its initial bull run, although it sticks to the $4,100 region per troy ounce on Thursday. The yellow metal extends it recovery on the back of the lacklustre performance of the US Dollar and declining US Treasury yields following the US midterms elections.

Bitcoin falls below $76,000 as NASDAQ drops 5% on AI sell-off

Bitcoin (BTC) and the wider crypto market fell on Thursday as US markets opened. Losses in AI-related stocks pushed the NASDAQ Composite (IXIC) down as much as 5% amid concerns that Democrats' control of both chambers of the US Congress could lead to tighter crypto and AI regulations.

NFP stress test: Six payrolls releases, measured in daily-loss limits

Friday's US employment report is usually previewed in terms of the headline number and the reaction in the Dollar. For a growing group of traders, those running funded or evaluation accounts with a fixed daily loss limit, there is a more practical question: how much of that limit can the first hour consume, regardless of direction?

US Dollar breaks below 101.50 as Democrats sweep Congress

The US Dollar (USD) comes under heavy selling pressure on Wednesday, with the US Dollar Index (DXY) falling around 0.5% to trade near 101.35 after sliding below the 101.50 level. The Greenback retreats to its lowest level in four weeks as investors reassess the political and economic outlook following the Democratic Party's sweeping victory in the United States (US) midterm elections.