US Brief: top Trade Setups in Forex - Bank of England In Highlights!

The U.S. indices closed mixed for a second day on Wednesday as earnings season slows down. Meanwhile, the media reported that U.S. President Donald Trump and Chinese leader Xi Jinping might not be able to sign the first phase trade deal until December. The Dow Jones Industrial Average was flat at 27,492, the S&P 500 edged up 2 points (+0.1%) to 3,076, while the Nasdaq Composite lost 24 points to 8,410.

Later today, economists expect initial jobless claims to drop to 215,000 for the week ended Nov 02 from 218,000 in the prior week. Continuing claims are expected to fall to 1.68 million for the week ended Oct 26 from 1.69 million the prior week.

European stocks remained firm, with the Stoxx Europe 600 edging up 0.2%, Germany's DAX climbing 0.2%, France's CAC gaining 0.3%, and the U.K.'s FTSE 100 rising 0.1%.

XAU/USD - Bullish Trendline Supports 

On Thursday, the precious metal gold crept down, losing some of its safe-haven demands after China stated that it had coincided with the United States in the preceding two weeks to a phased reversal of the additional tariffs forced during their months-long trade war.

Gold sank 0.2% at $1,487.27 per ounce after placing a high around $1,490 during the Asian session. Senior officials of the Trump administration stated that a conference between U.S. and Chinese representatives to sign an interim trade settlement could be postponed until December. 

The trade war among the world's two greatest nations for the preceding sixteen months has agitated financial markets and heightened concerns of an economic slowdown, supporting the safe-haven gold as its prices rose nearly 16% in 2019.

XAU/USD - Daily Technical Levels

Gold - XAU/USD- Daily Trade Sentiment

The XAU/USD traded as forecasted in our previous report. The precious metal completed the bullish retracement of 23.6% at 1,487 mark and 38.2% Fibonacci of 1,494. 

At the moment, this 1,494 is extending substantial hurdles to gold. Technically, the XAU/USD can sail further until 50 SMA resistance and 50% Fibo mark of 1,497 range. Under this mark, traders can assume a bearish reversal in the prices of gold.

USD/CAD- Dollar Gains over Eased Trade War 

The USD/CAD is trading slightly bearish at 1.3160, falling from 1.3200 high today. The Bank of Canada (BOC) is one of the central banks that are avoiding the interest rate cuts this year. Despite determined slowing global GDP growth headwinds, the Canadian economy has remained flexible and widely supported amid BOC's hawkish monetary policy stance. 

The Canadian dollar surged to around a weekly high versus its U.S. dollar economic figures revealed a reduction in Canada's trade deficiency and traders became more confident of a trade agreement between the United States and China.

USD/CAD- Daily Technical Levels

USD/CAD - Daily Trade Sentiment

The USD/CAD continues to trade within the same trading range of 1.3180 - 1.3120 as a stronger dollar fails to drive move buying in the commodity currency. The crude oil prices also remain stronger due to which, the Loonie also gained bullish moment. For now, the USD/CAD may trade bullish only above 1.3175 resistance level to target 1.3220.

AUD/USD – Fibonacci Supports 

The AUD/USD dipped 0.3% to 0.6877. This morning, government data showed that Australia recorded a trade surplus of 7.18 billion Australian dollars in September (A$5.05 billion surpluses expected).

The AUD/USD currency pair still found on the bearish track even after the positive numbers of Australian trade data. In short, the pair continues its losing streak. The country's trade surplus increased to A$7,180 million in September, crossed the expected figures of A$5,000 million by a big margin. Moreover, the trade surplus stood at A$5,926 million in August. 

Exports or outbound shipments increased by 3% during September, having decreased by 3% during August. In the meantime, the imports or inbound shipments also increased by 3%. The bullish trend in the imports will likely be considered a sign the domestic demand is holding up well after the Federal Reserve Bank of Australia's rate cuts. The AUD/USD currency pair still stood at the bearish track near 0.6877. 

The AUD/USD currency pair will likely drop more due to the greenback is on the bullish track and taking strong buying in the wake of the United States and China trade fears. As the report came that the round-1 deal could be signed in December while another statement came from unknown sources that the United States will not increase the tariff on Chinese goods scheduled to take place from Dec 15.

At the data front, the weekly reading of the United States' initial Jobless Claims and speech from the President and CEO of the Federal Reserve Bank of Dallas, Robert Kaplan, will also keep ner focus.

AUD/USD - Technical Levels 

AUD/USD - Daily Trade Sentiment

The AUD/USD slipped lower to test 50% Fibonacci retracement level of 0.6870 as the stronger dollar continued to dominate the market. At the moment, the dollar is getting weaker in the wake of faded trade deal risks. The Aussie is gaining bullish momentum, especially after closing a bullish engulfing pattern on the 4 hourly charts. The AUD/USD may trade bullish to target 0.6887 to target 0.6925 level today.

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