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US Dollar Strengthened Ahead of the Federal Reserve’s May Meeting The main event of the Easter week was the European Central Bank (ECB) meeting that ended last Thursday. The central bank left the monetary policy unchanged and even though it sounded more hawkish than expected, the euro lost ground against the US dollar. The ECB announced that it would end its asset purchases in the third quarter of this year but acknowledged that the ECB and the Fed are on different paths in their policy normalization plans. While the ECB may deliver one or two rate hikes this year, the Fed already hiked once. Moreover, many voices inside the FOMC Committee favor a 50bp rate hike in May, thus widening the gap between the interest rates on the two sides of the Atlantic. Since COVID-19 started two years ago, many have been shocked by the Fed’s and other central banks’ responses to the pandemic. Monetary and fiscal policies expansion have led to excessive inflation, hurting savings and driving investors into inflation-protecting assets. Some bought cryptocurrencies such as Bitcoin and Ethereum in the hope that they will keep their value intact. Some other ones bought gold, the traditional hedge against inflation. But the one currency that did appreciate was the US dollar. With all the doom and gloom over the years, the US dollar remains the de-facto world’s reserve currency. The greenback has no rival, as almost 60% of the world’s reserves are in dollars. The euro comes in a distant second place, while the Japanese yen is in third place. This is an important statistic ahead of the Fed’s May meeting. The three central banks (the Fed, the ECB, and the Bank of Japan) have different and divergent monetary policies. As mentioned earlier, the Fed started to tighten the monetary policy. Excessive inflation will push the Fed to hike at every meeting in 2022 and, most likely, more than 25bp. Moreover, the Fed has begun the process of shrinking its balance sheet. Quantitative tightening is the opposite of quantitative easing, thus contributing to even tighter financial conditions. The ECB, as argued above, is nowhere near the Fed in terms of policy normalization. While inflation in Europe is above the ECB’s target, the war in Ukraine prevents the central bank from raising rates too fast. As for the Bank of Japan is involved in a yield curve control process that led to one of the fastest depreciation on record for the Japanese yen. Therefore, the central banks of the three top currencies in which reserves are kept have divergent policies. They all favor a stronger dollar ahead of the Fed’s May meeting and beyond. FXOpen Blog

GBP/USD Edge Lower While EUR/GBP Could Surge GBP/USD started a fresh decline from well above the 1.3120 level. EUR/GBP is rising and might attempt an upside break above the 0.8300 resistance zone. Important Takeaways for GBP/USD and EUR/GBP The British Pound started a fresh decline from well above 1.3120 against the US Dollar. There was a break below a key contracting triangle with support near 1.3060 on the hourly chart of GBP/USD. EUR/GBP formed a base above 0.8250 and is currently rising. There is a major bearish trend line forming with resistance near 0.8290 on the hourly chart. GBP/USD Technical Analysis The British Pound struggled to settle above the 1.3120 resistance zone against the US Dollar. The GBP/USD pair started a fresh decline below the 1.3080 support zone. There was a clear move below the 1.3050 level and the 50 hourly simple moving average. The bears pushed the pair below the 50% Fib retracement level of the upward move from the 1.2972 swing low to 1.3146 high. GBP/USD Hourly Chart Besides, there was a break below a key contracting triangle with support near 1.3060 on the hourly chart of GBP/USD. The pair is now trading near 1.3020. The next major support sits near the 1.3110 level. It is near the 76.4% Fib retracement level of the upward move from the 1.2972 swing low to 1.3146 high. Any more losses could lead the pair towards the 1.2975 support zone or even 1.2950. On the upside, an initial resistance is near the 1.3040 level. The next main resistance is near the 1.3070 zone and the 50 hourly simple moving average. A clear upside break above the 1.3070 and 1.3100 resistance levels could open the doors for a steady increase in the near term. Read Full on FXOpen Company Blog...

ETHUSD and LTCUSD Technical Analysis – 14th APR, 2022 ETHUSD: Double Bottom Pattern Above $2,900 Ethereum failed to continue its bullish momentum last week, and started to decline after touching a high of 3,299 on April 8th. It touched an intraday low of 3,093 in the Asian trading session, and an intraday high of 3,142 in today’s European trading session. We can clearly see a double bottom pattern above the $2,900 handle which is a bullish pattern and signifies the end of a bearish phase and the start of a bullish phase in the markets. ETH is now trading just above its pivot level of 3,111 and moving in a mildly bullish channel. The price of ETHUSD is now testing its classic resistance level of 3,120 and Fibonacci resistance level of 3,128, after which the path towards 3,200 will get cleared. The relative strength index is at 59 indicating a STRONG demand for Ethereum and the continuation of the bullish trend. Both the average directional change and commodity channel index are indicating a neutral level which means that the prices are due to enter into a consolidation phase. Most of the technical indicators are giving a STRONG BUY market signal. Most of the moving averages are giving a STRONG BUY signal, and we are now looking at the levels of $3,300 to $3,350 in the short-term range. ETH is now trading below both the 100 hourly and exponential moving averages. Bullish reversal seen in Ether above the $2,900 mark The short-term range appears to be mildly BULLISH The daily RSI is below 50 at 48 indicating a NEUTRAL market The average true range is indicating LESSER market volatility Ether: Bullish Reversal Seen Above $2,900 ETHUSD is now moving in a mildly bullish channel with the price trading above the $3,100 handle in the European trading session today. Ethereum is now slowly preparing for its next move against the US dollar. We can see the formation of a contraction triangle pattern, which shows price building energy, and we can see the A-C and B-D trendlines. ETHUSD is now facing its immediate resistance levels of $3,128 and $3,300, after which we will see a linear progression towards the level of $3,400. The key support levels to watch are $2,906 and $3,034, and the prices of ETHUSD need to remain above these levels for the bullish trend to continue. ETH has gained 2.05% with a price change of $62.64 in the past 24hrs and has a trading volume of 15.476 billion USD. We can see a decrease of 19.10% in the total trading volume in the last 24 hrs, which appears to be normal. The Week Ahead Last week, we saw Ethereum decline from its highs of 3,299 to the lows of 2,951, but now we can see that the prices have entered a consolidation phase above the level of 3,000. If the price of ETHUSD remains above $3,000, we may see a linear progression towards the levels of $3,200 and $3,350 this week. The immediate short-term outlook for Ether has turned mildly BULLISH; the medium-term outlook has turned neutral; and the long-term outlook for Ether is NEUTRAL in present market conditions. This week, Ether is expected to move in a range between $3,100 and $3,300, and next week, it is expected to enter a consolidation phase above $3,300. Technical Indicators: The Williams percent range: at -44.92 indicating a BUY The moving averages convergence divergence (12,26): at 15.85 indicating a BUY The rate of price change: at 0.332 indicating a BUY Bull/Bear power (13-day): at 16.23 indicating a BUY