We have outlooked several promising Forex pairs and the result can surprise you!
XAU/USD: is more upside possible?
Information is not investment advice
XAU/USD remains in an uptrend. This week it rose above the key psychological level of 1,500. In the longer term, a break above 50% of the 2011-2015 decline at 1,481 has opened the way up to 1,585 (61.8% Fibo).
There’s an inside bar pattern on D1 - a sign of consolidation. Usually, it’s considered that the most likely direction of a breakout after an inside bar is in line with the preceding trend. However, we should notice that gold is largely overbought and on many timeframes, the Awesome Oscillator doesn’t confirm the latest highs. If XAU/USD tries to break above 1,510 (recent high), be careful: the breakout may be false. In case of a false break and a failure to close above 1,510, it’s safe to sell gold.
Without a false breakout to the upside, the decline below 1,499 will likely cause the slide to the 1,493 area, where there’s support. A further fall below 1,490 will bring the price to 1.481. The price will be able to rise to 1,525 and higher only in case of a daily close above 1,510.
This week, there are a few high-probability trade ideas I'd like to recommend to you. Trading these setups, be sure to implement a proper risk management approach.
On Thursday, the 2nd of February, the Bank of England will publish its report concerning interest rates and inflation data for the Eurozone. Professionals and investors anticipate that Andrew Bailey’s lead team of policy makers will likely raise interest rates to 4%; the highest in over a decade, for the tenth time in a row.
The first FOMC meeting comes after a buildup of anticipation from traders and investors alike, as the markets await what posture the Fed will take regarding the interest rates; would there be a hike or a cut in interest rates? Recall that the Federal Open Market Committee had previously ended the year 2022 with a 50bps hike, and an indication from Powell, the committee chairman, that the Fed could consider raising interest rates by 75bps in the course of the year 2023.