Top Trade Setups in Forex – Canadian GDP Figures In Highlights!


The U.S. stocks encountered another heavy sell-off amid growing worries that global spreading of the coronavirus would impact supply chains and corporate earnings. The Dow Jones Industrial Average made a nose-dive of 1191 points (-4.4%) to 25766, the largest single-day decline in history.

The S&P 500 plummeted 137 points (-4.4%) to 2978, losing the key 3,000 level for the first time since October. And the Nasdaq 100 plunged 437 points (-4.9%) to 8436. All these three major indexes have officially entered a correction phase after sinking over 10% from their recent highs. Plus, the Dow and the S&P 500 has crossed below their 200-day moving averages. Later today, Canada's fourth-quarter annualized GDP data will be reported (+0.3% on quarter expected).

 

XAU/USD - 50% Fibonacci Level Retracement 

On Friday, the precious metal gold reversed as traders booked profits from a 1% spurt in the last session, but the metal had some support as rising anxieties over the speedy spread of coronavirus raised expectations of rate reductions by major central banks.

During the U.S. session, the U.S. Commerce Department will report January personal spending (+0.3% on month expected) and personal income (+0.4% on month expected).

The Commerce Department will post January goods trade balance (68.5 billion dollars deficit expected) and wholesale inventories (+0.1% on month expected). The Market News International will release February Chicago PMI (46.0 expected). The University of Michigan will publish its final readings of the February Consumer Sentiment Index (100.7 expected). 

The U.S. government bonds kept seeing safe-haven buying, as the benchmark 10-year Treasury yield settled at a record-low of 1.299%. Consequently, the gold prices are likely to keep the trading bias bearish, and most of the moment will depend upon the U.S. fundamentals.

XAU/USD

 

XAU/USD - Daily Technical Levels

Support

Pivot Point

Resistance

1633.48

1646.99

1658.64

1621.83

1672.15

1596.67

1697.32

 

XAU/USD - Daily Trade Sentiment

On Friday, the precious metal gold disappoints to break the double top resistance mark of 1,660 and slides lower despite the new coronavirus outbreak cases in various countries.

Right now, the yellow metal gold is crumbling beneath the horizontal support mark of 1,637, and it's expected to prolong its selling bias to 1,624 zones. Closing of candles over 1,624 can encourage bullish repeal, but the violation of this level can lead to gold prices towards 1,612.

 

USD/CAD - Ascending Triangle Breakout

The Canadian dollar was dragged lower against the greenback, as the decline in oil prices showed no signs of stabilizing. USD/CAD advanced 0.4% to 1.3383. Later today, Canada's fourth-quarter annualized GDP data will be reported (+0.3% on quarter expected).

The Canadian dollar shifted to a near six-month low versus its U.S. counterpart on Thursday as oil prices dropped for a fifth consecutive day due to surge in new coronavirus cases outside China that fueled fears of a pandemic.

The U.S. official data showed that the fourth-quarter GDP (second reading) grew 2.1% on the quarter (as expected). Durable goods orders (preliminary reading) declined 0.2% on month in January (-1.4% expected). The number of initial jobless claims rose to 219,000 in the week ended February 22 (212,000 expected).

Oil prices continued to exhibit massive downward momentum. U.S. Nymex crude oil futures shed 3.4% to $47.09 a barrel, and Brent was down 2.3% to $52.18 a barrel, which is eventually keeping the Canadian dollar bearish.

USDCAD

 

USD/CAD - Daily Technical Levels

Support

Pivot Point

Resistance

1.3336

1.3365

1.3414

1.3288

1.3443

1.321

1.3521

 

USD/CAD - Daily Trade Sentiment

The USD/CAD has already violated the ascending triangle pattern, which was providing its resistance around 1.3330, and bullish breakout of this level is extending the buying trend until 1.3520 level. At the moment, the RSI and Stochastics are holding in the overbought zone, suggesting the overbought scenario of the market, and technically, it should drive a slightly bearish trend in USD/CAD.

The pair is likely to gain immediate support around 1.3435, along with resistance around 1.3525. Let's consider staying bullish above 1.3365 today.

 

AUD/USD – Bearish Channel Intact

The AUD/USD rebounded 0.5% to 0.6576 and NZD/USD gained 0.3% to 0.6312. For now, the market's focus will stay on the U.S. official data, which showed that the fourth-quarter GDP (second reading) grew 2.1% on the quarter (as expected).

Durable goods orders (preliminary reading) declined 0.2% on month in January (-1.4% expected). The number of initial jobless claims rose to 219,000 in the week ended February 22 (212,000 expected).

Later today, reports on January wholesale inventories (+0.1% on month expected), personal income (+0.4% on month expected), and personal spending (+0.3% on month expected). February Market News International's Chicago Purchasing Managers' Index (46.0 expected) and the University of Michigan's Consumer Sentiment Index (100.7 expected) will also be reported.

The Aussie dollar is experiencing new bearish bias in the wake of the coronavirus outbreak. Australia is initiating an emergency response system to cope with the coronavirus, declaring the warning of a global pandemic is “now very much upon us”.

Scott Morrison announced that a travel prohibition on non-resident travelers from China would continue for at least another week. Although he told further travel bans on travelers from other jurisdictions were not being executed.

AUDUSD

 

AUD/USD - Technical Levels

Support

Pivot Point

Resistance

0.6549

0.6571

0.6595

0.6525

0.6616

0.6479

0.6662

 

AUD/USD - Daily Trade Sentiment

The bearish channel of the AUD/USD continues to drive bearish momentum in the Aussie pair as the pair has dropped from 0.6530 to 0.6450. As of now, the AUD/USD pair is testing the downward support level of 0.6490 which is extended by the bearish channel.n

Continuation of a selling trend in the AUD/USD may drive more selling until the next support level of 0.6550 today. The RSI and Stochastics are crossing below 50, suggesting further odds of selling in the AUD/USD pair. Let's consider taking sell trades below 0.6530 until 0.6450.

 


 

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