Source: PaxForex Premium Analytics Portal, Fundamental Insight
US Initial Jobless Claims for the week of August 19th are predicted at 240K, and US Continuing Claims for the week of August 12th at 1,708K. Forex traders can compare this to US Initial Jobless Claims for the week of August 12th, reported at 239K, and US Continuing Claims for the week of August 5th at 1,716K.
US Preliminary Durable Goods Orders for July are predicted to plunge by 4.0% monthly, and Durables Excluding Transportation to increase by 0.2% monthly. Forex traders can compare this to US Durable Goods Orders for June, which surged by 4.7% monthly, and Durables Excluding Transportation, which rose by 0.6% monthly. Capital Goods Orders Non-Defense Excluding Aircraft for July are predicted to inch up by 0.1% monthly. Forex traders can compare this to Capital Goods Orders Non-Defense Excluding Aircraft for June, which rose by 0.2% monthly.
US Natural Gas Inventories for the week ending August 18th are predicted at 33B cubic feet. Traders can compare this to US Natural Gas Inventories for the week ending August 11th, reported at 35B cubic feet.
The US economy continues to print disappointing data, and the consumer approaches a breaking point, with debt levels at all-time highs. Core inflation remains sticky, and other countries have begun to print upside surprises. The US Federal Reserve noted that higher rates are on the table, and even a pause would not suggest a reversal. Stagflation is a threat markets ignore, and a rolling recession could last for years. A perfect storm is brewing, and US equity markets face an ongoing bearish threat.
The forecast for the SP500 remains cautiously bearish after this equity index pushed higher over the past five sessions following a drop into its Ichimoku Kinko Hyo Cloud. Price action now challenges the top of its Ichimoku Kinko Hyo Cloud, which began to narrow, with the Senkou Span A drifting higher and the Senkou Span B moving lower. A bearish crossover could force heavy selling from current levels. Price action trades above its flat Tenkan-sen but below its flat Kijun-sen, with downside pressure mounting. Traders should also monitor the CCI after it recorded a lower low in extreme oversold territory, followed by a sharp spike. This technical indicator is on track to record a lower high near extreme overbought conditions, from where a reversal could add to rising bearish forces. Can bears overpower bulls and force the SP500 into its horizontal support area? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the SP500 Index remain inside the or breakdown below the 4,450 to 4,500 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 4.465
- Take Profit Zone: 4.230 – 4.275
- Stop Loss Level: 4.540
Should price action for the SP500 Index breakout above 4,500, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 4.540
- Take Profit Zone: 4.575 – 4.605
- Stop Loss Level: 4.500
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