Source: PaxForex Premium Analytics Portal, Fundamental Insight
Economists forecast US Initial Jobless Claims for the week of October 1st at 203K, and US Continuing Claims for the week of September 24th are predicted at 1,345K. Forex traders can compare this to US Initial Jobless Claims for the week of September 24th, reported at 193K, and US Continuing Claims for the week of September 17th, reported at 1,347K.
US Natural Gas Inventories for the week ending September 30th are predicted at 113B cubic feet. Traders can compare this to US Natural Gas Inventories for the week ending September 23rd, reported at 103B cubic feet.
After the ADP report beat forecasts, traders await the September NFP report, where economists predict 250K job additions. The wage component will provide crucial data as the Federal Reserve monitors wage-based inflation. While a solid reading could elevate markets temporarily, as the recessionary environment deepens while borrowing costs rise, the downturn is set to extend. Third-quarter earnings season will deliver the next significant catalyst, and it shapes up to disappoint. While bargains emerge in some equities, the broader trend remains bearish, and the technology sector is the most vulnerable to existing conditions.
Financial markets could extend their October recovery following yesterday’s break, which creates another bull trap. After major indices recorded fresh bear market lows, a reversal is normal and expected. Traders should monitor the upswing, as it could create a lower high, with the 12,600 mark a key resistance level. Events that sparked the bear market and global recession have intensified, and traders should prepare for lower lows. Inflation remains higher than forecast and is broader than central banks feared. Economic data continues to show signs of weakness with occasional upside surprises, clouding the picture and providing fuel for bear market rallies.
The forecast for the NASDAQ100 remains bullish in the short-term, but the long-term bearish pattern is healthy and intact, as confirmed by the descending Ichimoku Kinko Hyo Cloud. Volatility could spike with the Tenkan-sen drifting higher and the Kijun-sen flat. Traders should monitor upside momentum after the CCI has completed a breakout from extreme oversold territory, followed by a crossover above zero. It has more upside potential and could guide price action higher over the next few trading sessions. Can bulls extend their gains and push the NASDAQ100 into its horizontal resistance area? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the NASDAQ 100 Index remain inside the or breakout above the 11,500 to 11,865 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 11.645
- Take Profit Zone: 12.380 – 12.600
- Stop Loss Level: 11.250
Should price action for the NASDAQ 100 Index breakdown below 11,500, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Long Position @ 11.250
- Take Profit Zone: 10.300 – 10.835
- Stop Loss Level: 11.500
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