Weekly Market Commentary | Sep 5

The new week starts out in a risk-off sentiment, following Gazprom’s announcement that it had stopped sending gas to Europe. The gas provider stated an oil leak for its decision but didn’t specify when repairs will take place and how long they will take. It could last indefinitely. 

Due to Labor Day, the US market will be closed on Monday, and trading activity may stay sluggish in the afternoon.

Tuesday>

– The Reserve Bank of Australia is expected to deliver another 50 bps rate hike, bringing the official rate to 2.35%; AUDUSD might be volatile afterward

– During the US session, the ISM survey from the services sector is due, projected to decline notably from 56.7 to 54.9 in August

Wednesday>

– EU employment and GDP data for the second quarter are on the agenda, likely moving the EURUSD pair

– The Bank of Canada interest rate decision, with the central bank projected to deliver a 75 bps rate hike, from 2.5% to 3.25% as it combats soaring inflation

– Jerome Powell’s speech, most likely causing severe volatility in the markets

Thursday>

– ECB monetary policy decision, markets are indecisive about whether to expect 50 or 75 bps on Thursday. In case of a disappointment, EURUSD could dive further below parity

Friday>

– Chinese inflation data being the headline macro event during the Asian session

– Canadian labor market figures will influence the USDCAD pair during the US session

Setups for This Week:

EURUSD

Primary View:

New week starts with the EURUSD breaking another crucial support on the 0.991

The price is making a new, long-term low

As long as we stay below the blue area, the sentiment is definitely negative

Alternative View:

If the price comes back above the 0,991, a buy signal will be triggered as that would mean a false bearish breakout (orange)

Gold

Primary View:

Gold is bouncing off the 1690 USD/oz support, which is absolutely key in the long-term

A breakout would mean a continuation of a negative sentiment

As long as we stay above, there is a chance for a mid-term buy signal, with a desirable risk to reward ratio

NZDJPY

Primary View:

NZDJPY is inside of the symmetric triangle pattern, waiting for a proper breakout

The price breaking to the upside, would mean a legitimate buy signal

The price breaking to the downside, would trigger a long term sell signal

The first option seems more probable