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Bearish Patterns

EURUSD: Sell RalliesThe dollar has been in a strong recovery for the past two weeks, ever since the Fed decided to cut rates by 50 basis points in mid-September. This appears to be a classic “buy the rumor, sell the news” situation, as much of the dollar weakness earlier this year was driven by speculation that the Fed would cut rates. Now that they've finally done it, we’re seeing the opposite reaction. Focusing on the EUR/USD pair, we can see a very clear and strong push to the downside, forming an impulsive pattern from the 1.12 level. In Elliott Wave terms, this structure indicates the trend direction, which on the intraday timeframes is currently down. I would expect more weakness ahead, although markets never move in a straight line, so an ABC pullback is possible. In such a case, 1.10 to 1.1040 could serve as a good resistance zone to sell into. It's also important to note that the ECB may be leaning towards more rate cuts, especially with Germany’s economic struggles. This could further pressure the euro, particularly if the Fed slows down its dovish actions, given that US inflation didn’t drop to the expected 2.3%, but instead came in at 2.4%. With US yields poised to move higher while the ECB remains dovish, I believe EUR/USD will stay under pressure.
Short
by ew-forecast
RBNZ Reinforces Dovish Stance and Delivers 50bp Cut Overnight, the Reserve Bank of New Zealand (RBNZ) reduced its Official Cash Rate (OCR) by 50 basis points (bps) and signalled further policy easing is on the table amid softening inflation. This leaves the current OCR at 4.75%. Cuts Ahead The accompanying Rate Statement communicated that the current economic landscape provides scope to reduce rates further. However, the central bank emphasised that rate adjustments depend on the ‘evolving assessment of the economy’ and ‘there are still risks that further adjustments might be faster or slower than currently expected’. The Committee also touched on escalating tensions in the Middle East, noting that it ‘could pose significant risks to both global economic activity and energy prices. Should conflict escalate, oil prices and shipping costs could rise, and adverse investor sentiment could trigger asset price corrections and tighter financial conditions’. Several desks and money markets (the Overnight Index Swaps market) are currently pricing in another 50bp cut for November’s meeting – this will be the last time the central bank meets in 2024. New Zealand’s Economy at a Standstill We must remember that the RBNZ was one of the first G10 central banks to begin rapid policy tightening, and inflation has indeed slowed. However, in the process, demand has weakened, unemployment rose to 4.6% in Q2 24 (the highest rate since early 2021), and the economy has all but reached a standstill over the last two years (real Gross Domestic Product contracted by 0.2% in Q2 24) with a shallow technical recession seen in the second half of 2023. Markets will receive the latest CPI inflation (Consumer Price Index) data from New Zealand next week – this is released every quarter – with the expectation that CPI inflation will ease back into the RBNZ’s target inflation band of 1-3% in Q3 24 (YoY) from 3.3% in Q2 24. Of note, however, this is tradeable inflation. Domestic inflation (or non-tradeable inflation) is a different story and is proving sticky; the latest release showed that non-tradeable inflation rose 5.4% in Q2 24 (YoY), down from 5.8% in Q1 24. NZD Lower Across the Board Today’s decision/forward guidance sent the New Zealand dollar (NZD) tumbling against G10 peers, with losses most notable versus the US dollar (USD) and Swiss franc (CHF) as of writing. Early London has the NZD trading a whisker north of daily lows versus the USD from NZ$0.6075, propelling the NZD/USD currency pair through a descending resistance-turned-support level (extended from the high of NZ$0.6369). The decision point zone at NZ$0.6035-NZ$0.6056 calls for attention and may see traders begin locking in some profit if the area is tested, given the sell-stops tripped south of the higher low formed at NZ$0.6106 (11 September). The next major support level beyond the decision point to consider is around NZ$0.5991. Overall, per the above structure, the pairing demonstrates scope to continue exploring lower levels.
Short
by FPMarkets
Pepsico (PEP): Breakout or Rebound? Earnings Report IncomingThis week, Pepsico is set to announce its earnings, and we continue to monitor the same pattern that has persisted for a while now. PepsiCo's recent $1.2 billion acquisition of Siete Foods is a strategic move to expand Frito-Lay's "better-for-you" snack segment. Although the near-term impact on revenue is expected to be minimal, Citi predicts a modest contribution to overall growth. The deal is anticipated to close in 2025, broadening PepsiCo's multicultural portfolio. From a technical perspective, NASDAQ:PEP is still moving within the established range. We've added zones above and below the range and highlighted each instance when NASDAQ:PEP broke through the range. Except for one occurrence, all these breakouts provided good entry opportunities. The future direction remains uncertain, but the key is whether Pepsico can hold its level upon breaking through the range—it needs to hold to sustain momentum rather than falling back. For now, we continue to keep a close watch on NASDAQ:PEP and are waiting for this week's earnings report to provide further clarity. ✅
NASDAQ:PEP
by freeguy_by_wmc
07/10/24 Weekly outlookLast weeks high: $65,605.03 Last weeks low: $59,829.32 Midpoint: $62,717.17 After geo-political escalations causing panic in the markets at the beginning of last week, BTC has been spending the second half of the week trying to recover losses. The 1D 200EMA came in as support midweek to cap the sell-off, a steady climb back up flipping the 4H 200EMA back to bullish and finally the week low reclaim in the dying hours of the week. This to me is very positive, showing strength in times of major uncertainty. Another outside force Bitcoin will encounter is the US presidential election, that is now less than one month away and definitely will sway traditional markets and crypto alike. This week we have some key data events: Wednesday - FOMC minutes As the unemployment data came in better than forecast, this could be a sign of further rate cuts to come in November, we may get some clues on this in the report. Thursday - CPI (YoY) Previous: 2.5% Forecast: 2.3% Actual:??? With CPI forecast to drop closer to the FEDs 2.0% target, anything lower than 2.3% would be positive for markets, 2,3% is probably priced in and anything above would be negative for markets. Friday - PPI (MoM) Previous: 0.2% Forecast: 0.1% Actual:??? Similar story in PPI as CPI, forecasts are for another drop and markets could react similarly to what's stated above. Data events can be a non-event but now that the rate cut cycle has begun and the US election is on the way these events are more important than ever.
by ProR35
Microsoft (MSFT): Decision Point – Will It Hold or Drop?Since our last analysis on Microsoft, not much has changed in terms of price action, as it rose to $469 before getting stuck again at $416. However, there is one major development – Microsoft has formed a new trend channel. We have marked this crucial channel in red and labeled it "Must hold for more upside," emphasizing its importance. A major decision is approaching for $MSFT. Either Microsoft holds this channel, leading to a surge higher, or it loses this level, which would confirm the bearish head and shoulder pattern. We've maintained a bearish outlook on Microsoft since January 2024, and recent developments seem to support our analysis. For now, we're patiently waiting and letting the market decide. If Microsoft loses the channel, we could find initial support for wave (A) around $316-306. However, a better buying opportunity for wave II may present itself closer to $220 – though reaching this level will take some time. 🫡
NASDAQ:MSFT
by freeguy_by_wmc