Forex Market Outlook: 01 September 2022

Updated September 1, 2022

Dollar extended its rally, supported by prospects of higher interest rates which could last for a longer period after Fed Chairman Jerome Powell reiterated commitment to rein in inflation during the Jackson Hole Symposium. Meanwhile, commodities currencies also weakened against the Dollar as these currencies remain vulnerable to the market risk sentiment and recession concerns.

Elsewhere, Euro inched higher against the greenback this week after inflation data showed no signs of peaking, with annual inflation rate in Eurozone standing at 9.1% in August, ahead of 9% estimates and 8.9% reading in July. Higher energy costs, exacerbated by the energy crisis and supply disruption could push the Eurozone into recession as the region is heavily reliant on energy imports. Consumer sentiment data also fell short of expectations, reflecting the weaker sentiment as rising price pressures and slower growth continue to fuel slowdown fears.

Trade ideas that played out on Tuesday: 30 August 2022

NZDUSD M30: Bearish outlook seen, further downside below 0.6188

On the M30 time frame prices are approaching resistance at 0.61880 where we could see a reversal below this level. The 0.6188 resistance zone lines up with the graphical support-turned-resistance zone and 61.8% Fibonacci retracement. A pullback to this zone presents an opportunity to play the drop to the next support target at 0.6100.

Before:

Coloured candles represent our projection

Source: TradingView. https://www.tradingview.com/chart/NZDUSD/ovsagsFa-NZDUSD-M30-Bearish-outlook-seen-further-downside-below-0-6188/

After:

Today’s trade ideas: 1 September 2022

EURUSD M30: Bearish outlook seen, further downside below 1.0040

On the M30 time frame, prices are facing bearish pressure from the resistance zone at 1.0040, in line with the 38.2% Fibonacci retracement and graphical support-turned-resistance zone. We could see further downside below this zone to the support zone at 0.9980. Stochastic is showing bearish divergence as well where we could see further downside in prices.

Coloured candles represent our projection

Source: TradingView. https://www.tradingview.com/chart/EURUSD/8AYOEqwq-EURUSD-M30-Bearish-outlook-seen-further-downside-below-1-0040/

AUDUSD M30: Bearish outlook seen, further downside below 0.68500

On the M30 time frame, prices are facing bearish pressure from the resistance zone at 0.68500, in line with the Fibonacci confluence levels where a pullback to this zone could present an opportunity to play the drop to our next support target at 0.6780. Prices are holding below the Ichimoku cloud as well supporting the bearish bias.

Coloured candles represent our projection

Source: TradingView. https://www.tradingview.com/chart/AUDUSD/QhVRbeNb-AUDUSD-M30-Bearish-outlook-seen-further-downside-below-1-0040/

GBPUSD H1: Bearish outlook seen, further downside below 1.1690

On the H1 time frame, prices are facing bearish pressure from the resistance zone at 1.1690, in line with the 38.2% Fibonacci retracement and 100% Fibonacci extension we could see further downside below this zone to the support zone at 1.1520. This support zone lines up with the descending channel’s support and 100% Fibonacci extension. Prices are holding below the Ichimoku cloud as well supporting the bearish bias.

Coloured candles represent our projection

Source: TradingView. https://www.tradingview.com/chart/GBPUSD/qhurdZNt-GBPUSD-H1-Bearish-outlook-seen-further-downside-below-1-1690/

Past performance is no indication of future performance. This report is provided by Zeta Labs, a specialized Forex Fintech Consultant and Technical Advisor who provides white-label solutions for FX Market Analysis, trading insights and education webinars. The team has a wealth of industry experience, with our analyst being part of the team recognised by The Technical Analyst Awards as Finalist for the Best FX Research for 4 consecutive years (2019, 2020, 2021, 2022). 

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