The upward momentum in the Hang Seng Index (HSI) appears to be fading, suggesting that the one-month rebound could have limited upside from here.

HSI, up 25% from the October low of 14597, has run into a tough barrier at about 18415: the 89-day moving average, coinciding with the March low of 18235 and the 200-period moving average. The shorter moving average has posed quite-strong resistance since late 2021, so a retreat can’t be ruled out.
Moreover, bullish momentum since October hasn’t been any different from previous corrective rebounds this year It may be too soon to conclude that the Hong Kong benchmark index has turned a corner. Indeed, the medium-term downtrend remains intact . 

HKG33 D1 11 30 2022 1248

The trend and momentum, as indicated by the Moving Average Convergence Divergence (MACD) indicator, remain pointed down on higher timeframes, including the monthly and quarterly charts. Any break below immediate support at Monday’s low of 16834 would confirm that short-term upward pressure had eased, exposing downside risks toward the October low of 14597.

 

 

 

 

 

The British pound remains in a consolidatory phase at relatively high levels despite attempts by Fed officials to reinforce an aggressive rhetoric. While these attempts have been futile, the upcoming statement by Fed Chair Jerome Powell and consequent U.S. centric data could see the pound take a turn lower.

Money markets are currently pricing in 54bps which is in line with a 50bps hike considering the depleted state of the UK economy. The BoE’s Mann will also shed light on the current state of affairs and in the absence of UK fundamental data of recent, markets may react more fervently to any surprise BoE guidance. 

GBPUSD D1 11 29 2022 1250
Daily GBP/USD price action is marginally above the psychological 1.2000 handle with eh Relative Strength Index (RSI) close to overbought levels. There is still room for further upside towards the 1.2154 swing high which should coincide with the 200-day SMA (blue) but taking into account the economic headwinds facing the UK over the U.S., the recent bull run on cable may be running out of steam.

 

 

After a spectacular six-week rally, the New Zealand dollar appears set to shed some of its recent gains against the US dollar. NZD/USD, up 14% since mid-October, is now testing solid resistance on the 200-day moving average –a possibility highlighted in the previous update. In addition to the long-term moving average, there is a resistance on a downtrend line from June and a slightly upward sloping trendline from July. While there is no sign of reversal of the uptrend yet, even on intraday charts, negative momentum divergence on the daily and intraday charts (rising price associated with declining or stalling of momentum) indicates that the rally is showing signs of fatigue.

NZDUSD D1 11 25 2022 1344

If history is any guide, a retreat would not be surprising. The rallies in late 2021 and early 2022 ran out of steam at the long-term moving average. The pullback in NZD/USD was preceded by a negative momentum divergence, similar to the current divergence.
Any retreat could open the way toward last week’s high of 0.6205. Any break below would confirm that the upward pressure had eased, opening the way toward a key cushion at the November 17 low of 0.6060. This support is fairly strong and would be tough to crack, at least on the first attempt. Indeed, the floor could provide a platform for a retest of Thursday’s high of 0.6290.

 

 

 

 

 

 

 

 

 

 

 

The Australian Dollar tumbled to start the week on deteriorating global growth prospects.
Additionally, RBA Governor Philip Lowe spoke before a Senate estimate hearing. In regard to achieving a soft landing for the economy, he said, “it’s not guaranteed but where I sit today, I think we have a better chance than most other countries of pulling it off.” The RBA will meet Tuesday to decide on monetary policy and the market has priced in a 25 basis point hike.  

AUDUSD D1 11 28 2022 1236

AUD/USD has peeled back from the recent high of 0.6798 and that level might continue to offer resistance. A descending trend line is near a prior peak at 0.6916 and could also offer resistance.

On the downside, support may lie at the previous lows of 0.6585 and 0.6387, the latter also coincides with an ascending trend line. Between those levels, a breakpoint at 0.6548 could also provide support.

 

 

 

 

 

 

The British pound is running-higher this morning and GBP/USD looks like it is setting up for another test at the 1.2000 psychological level. 

GBPUSD D1 11 24 2022 1347

 

Sellers posed a breakdown in August which led to the September collapse-like move; but now that same price is back in the picture but showing as resistance. This held the highs last week and it appears as though another re-test may soon be on the cards.
Last week produced a resistance inflection at the psychological level and prices pulled all the way back to a familiar spot of support, plotted at around 1.1760 which was the July swing low. That price helped to set the low last week and buyers have been pushing ever since.

 

 

 

 

 

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