2023-12-18 08:56
Investors now await Tuesday’s BoJ decision to clarify the bank’s rate outlook. The dollar fell amid signs of potential Fed rate cuts next year. There has been uncertainty about when the BoJ might phase out its negative interest rate policy. Monday’s USD/JPY forecast hinted at a bearish trend, fueled by the Bank of Japan’s (BOJ) two-day monetary policy meeting beginning. Traders eagerly anticipated the central bank’s decision, speculating on the potential unwinding of its ultra-loose policy settings. –Are you interested to learn more about forex options trading? Check our detailed guide- Moreover, the currency extended weakness from the previous week following signals of potential interest rate cuts next year in the Federal Reserve’s policy meeting. Consequently, the yen gained nearly 2% last week as the dollar fell. Furthermore, the Japanese currency experienced volatility in recent weeks amid uncertainty about when the BoJ might phase out its negative interest rate policy. Notably, Governor Kazuo Ueda’s comments triggered a significant yen rally earlier this month. However, it was later reversed after news suggested a policy shift might not happen as early as December. Investors now await Tuesday’s BoJ decision to clarify the bank’s rate outlook. The pair had gained support due to aggressive rate hikes from the Fed and expectations of sustained higher rates in 2022 and 2023. However, recent Fed comments saw the dollar index record a substantial 1.3% decline last week. Franck Dixmier, a global chief investment officer for fixed income at Allianz Global Investors, commented, “The Fed has officially opened the door to the next cycle of rate cuts.” USD/JPY key events today Investors will await the result of the BoJ policy meeting as no high-impact events are scheduled for today. USD/JPY technical forecast: 142.02 support holds firm, decline takes a breather On the technical side, the USD/JPY’s decline has paused near the 142.02 key support level. However, the bearish bias remains strong as the price sits far below the 30-SMA, and the RSI is below the 50 mark. The recent decline started at the 146.03 key level, where the price respected the 30-SMA resistance. –Are you interested to learn more about forex tools? Check our detailed guide- However, bears show some vulnerability as the RSI has made a bullish divergence. Therefore, it shows bearish momentum has weakened, and this might allow bulls to trigger a pullback or reversal. The downtrend might continue without a pullback if bears regain strength. However, in case of a pullback, the price will likely pause at the 30-SMA before the downtrend continues. https://www.forexcrunch.com/blog/2023/12/18/usd-jpy-forecast-traders-on-edge-as-bojs-policy-shift/
2023-12-16 09:39
Inflation reports from the US showed further easing, supporting a Fed pivot. Policymakers were dovish at the Fed meeting on Wednesday, signaling an end to rate hikes. The BOE held its hawkish tone, stating that inflation was still concerning. The GBP/USD weekly forecast shows a bullish trajectory. The narrative unfolds with the Bank of England holding steadfast to its hawkish stance, which contrasts the Federal Reserve’s more dovish outlook. –Are you interested to learn more about forex options trading? Check our detailed guide- Ups and downs of GBP/USD GBP/USD had a bullish week amid a divergence in policy outlooks between the US Federal Reserve and the Bank of England. Major catalysts for last week’s move included US and UK policy meetings and US inflation reports. Notably, inflation reports from the US showed further easing, supporting a Fed pivot. As a result, policymakers were dovish at the Fed meeting on Wednesday, signaling an end to rate hikes. Meanwhile, the BOE held its hawkish tone, stating that inflation was still concerning, leading to a rally in the pair. Next week’s key events for GBP/USD GBP/USD traders will focus next week on the UK inflation report. On Thursday, the Bank of England was hawkish. Moreover, Governor Andrew Bailey emphasized that the battle against inflation is ongoing. Therefore, the inflation report will impact the outlook for rate cuts in the UK. Additionally, the UK will release retail sales data showing whether consumers are spending big or not. Consequently, this will also show the state of demand and inflation in the economy. Meanwhile, economic data from the US will include the gross domestic product and core durable goods orders. GBP/USD weekly technical forecast: Bulls aim for 1.3001 resistance level On the daily chart, GBP/USD trades in a bullish channel, respecting the channel support and resistance. At the same time, the price is making higher highs and lows, further confirming a bullish trend. The most recent high came near the 1.2700 key level, while the most recent low was near the 1.2501 key level. However, the uptrend exceeded the recent high when bulls broke above 1.2700. Therefore, the bullish trend will likely continue. –Are you interested to learn more about forex tools? Check our detailed guide- Moreover, indicators on the chart show further upside potential. The 22-SMA has acted as support, pushing the price higher every time it pulls back. Meanwhile, the RSI trades above 50, indicating stronger momentum for bulls. Therefore, there is a high chance the price will continue higher next week as bulls target the 1.3001 resistance level. https://www.forexcrunch.com/blog/2023/12/16/gbp-usd-weekly-forecast-hawkish-boe-gathering-traction/
2023-12-16 09:33
Inflation data from the US supported investor expectations of looming rate cuts. Powell said that the rate hike cycle was likely at an end. Economists do not foresee any changes at the upcoming BOJ meeting. In the USD/JPY weekly forecast, the winds of change are steering towards a bearish outlook. This trend comes as the Federal Reserve’s policy takes a dovish turn while the BoJ’s outlook takes a slightly hawkish twist. –Are you interested to learn more about forex options trading? Check our detailed guide- Ups and downs of USD/JPY USD/JPY ended the week in the red as the dollar weakened after the FOMC meeting. Moreover, inflation data from the US supported investor expectations of looming rate cuts. At the FOMC meeting, Powell said that the rate hike cycle was likely at an end. This opens the door for rate cuts in 2024. Additionally, investors were speculating on ending negative interest rates in Japan. This helped the yen gain on the dollar. However, changes are not expected at next week’s BoJ policy meeting. Next week’s key events for USD/JPY The BOJ will meet next week, and investors do not expect any policy changes. More than 20% of economists in a Reuters poll anticipate the Bank of Japan will start scaling back its ultra-loose monetary measures in January. However, none of the economists in the poll foresee any changes at the upcoming meeting. Moreover, the durable goods orders and the gross domestic product from the US will show the state of the economy. As such, these reports will impact Fed rate cut bets. USD/JPY weekly technical forecast: Bears unravel the recent bullish rally USD/JPY has retraced most of the recent bullish move after bears took over by breaking below the 22-SMA. The bearish sentiment shift occurred after bullish momentum weakened with a bearish RSI divergence. Therefore, the bears were finally strong enough to breach the 22-SMA resistance. At the same time, the RSI crossed below 50. Now that bears are in control, the price is breaking below support levels while keeping below the 22-SMA. –Are you interested to learn more about forex tools? Check our detailed guide- The most recent support breach was at the 146.03 level. The price broke and retested this level, which is now challenging new support at 142.02. If bears can close below this support, the price will decline to 138.04. However, the price might consolidate if the level holds as the 22-SMA catches up. https://www.forexcrunch.com/blog/2023/12/16/usd-jpy-weekly-forecast-fed-boj-divergence-leads-sellers/
2023-12-15 12:44
The gold price bias remains bullish in the short term as the US dollar is bearish. Taking out the pivot point activates further growth. The US economic data should bring sharp movements. The gold price seems undecided in the short term. The precious metal is trading at $2,041, below yesterday’s high of $2,047. The upside pressure remains high as the US dollar maintains a bearish bias. The XAU/USD stays higher even though the US Retail Sales, Core Retail Sales, and Unemployment Claims came in better than expected in the last session. As you already know, the yellow metal rallied as the markets expect the Federal Reserve to deliver a 75-bps rate cut next year. –Are you interested to learn more about ECN brokers? Check our detailed guide- Today, the Chinese, Eurozone, and UK data came in mixed. The traders are waiting for the US data before taking action. The Flash Services PMI could be reported at 50.7 versus 50.8 in the previous reporting period, while the Flash Manufacturing PMI could jump from 49.4 points to 49.5 points. Furthermore, the Empire State Manufacturing Index is expected at 2.0 points, the Capacity Utilization Rate could jump to 79.1% to 78.9%, while Industrial Production could report a 0.3% growth after the 0.6% drop in the previous reporting period. From the technical point of view, the price continues to challenge the static resistance of $2,041. The minor sideways movement could represent an upside continuation pattern. The price tried to attract more buyers before extending its gains. –Are you interested to learn more about day trading brokers? Check our detailed guide- The weekly pivot point of $2,049 represents a static resistance as well. It remains to see how it reacts around these upside obstacles. False breakouts followed by a new lower low may announce a potential sell-off. On the contrary, taking out the pivot point may announce further growth. The median line (ml) represents a major upside target. https://www.forexcrunch.com/blog/2023/12/15/gold-price-unchanged-below-recent-top-ahead-of-us-pmis/
2023-12-15 09:26
The BOE affirmed its commitment to keeping British interest rates elevated. Bailey said there was still a big distance to cover in addressing inflation concerns. There was a slowdown in the UK wage growth and a 0.3% decline in gross domestic product in October. The Bank of England (BOE) stands firm in its hawkish stance, even as the prospect of US rate cuts gains traction, making for a bullish GBP/USD price analysis. On Thursday, the BOE affirmed its commitment to keeping British interest rates elevated for an extended period. In contrast, the Fed has signaled rate cuts in 2024. –Are you interested to learn more about ECN brokers? Check our detailed guide- Governor Andrew Bailey declared a 6-3 vote to hold rates at a 15-year high of 5.25%. Additionally, Bailey said there was still a big distance to cover in addressing inflation concerns. Therefore, he went against the expectations of investors who had increasingly bet on rate cuts. Unlike the Federal Reserve’s indication of potential rate cuts in the United States, the BOE did not discuss cutting rates. On the contrary, it expressed concerns that Britain’s inflation might be more persistent. Meanwhile, data this week revealed a slowdown in wage growth and a 0.3% decline in gross domestic product in October. It raises concerns about a potential recession ahead of the expected 2024 national election. Still, the BOE remained steadfast. As a result, investors revised their expectations for the first rate cut from March to May. ING economist James Smith noted the BOE’s reluctance to support rate cut expectations. This is a divergence from the more proactive stance of the Federal Reserve. GBP/USD key events today UK Flash Manufacturing PMI UK Flash Services PMI US Empire State Manufacturing Index US Flash Manufacturing PMI US Flash Services PMI GBP/USD technical price analysis: Potential pullback as bullish momentum peaks On the technical side, GBP/USD has broken above the 1.2700 key resistance level in a strong bullish surge. As a result, the price left the 30-SMA far below, showing massive bullish strength. Similarly, the RSI has risen to the overbought region. However, this might also lead to a pullback as the bullish move is overextended. On the fib tool, the price has extended to 1.27 in one move without pauses. –Are you interested to learn more about day trading brokers? Check our detailed guide- Moreover, there is resistance slightly above at the 1.2800 key level. Therefore, a short pause would allow the price to retest the 1.2700 level. Furthermore, it would allow the SMA to catch up with the price. https://www.forexcrunch.com/blog/2023/12/15/gbp-usd-price-analysis-bulls-dominate-after-hawkish-boe/
2023-12-15 08:25
The European Central Bank adhered to its hawkish stance. Powell signaled on Wednesday that the era of tightening monetary policy is likely over. Markets are currently pricing in a 75% likelihood of a rate cut by the Fed in March. Friday’s EUR/USD outlook is bullish as the currency rallied, propelled by the European Central Bank’s unwavering commitment to a hawkish stance. In a surprising twist on Thursday, the ECB deviated from anticipated rate cuts. Moreover, policymakers restated their commitment to fighting inflation, contributing to the strengthening of the currency. –Are you interested to learn more about ECN brokers? Check our detailed guide- However, investor expectations remain unaltered despite this stance, with rate cuts still priced in for next year. Pepperstone’s Weston suggested that the ECB is better positioned to cut rates given low growth and a rapid decline in inflation. Meanwhile, there is more clarity on the timing of potential US interest rate cuts. Federal Reserve Chair Jerome Powell signaled on Wednesday that the era of tightening monetary policy is likely over. Additionally, discussions about cuts are now coming “into view.” Consequently, there was a decline in the dollar, with the dollar index hovering close to the four-month low on Thursday. The dollar has fallen by nearly 2% and is heading for its most substantial weekly drop since July. Furthermore, the anticipated Fed cuts for 2024 have been brought forward, with a growing number of investors now expecting cuts to start around March. Markets are currently pricing in a 75% likelihood of a rate cut by the Fed in March. EUR/USD key events today German Flash Manufacturing PMI German Flash Services PMI US Empire State Manufacturing Index US Flash Manufacturing PMI US Flash Services PMI EUR/USD technical outlook: Bulls encounter historical reversal zone The bullish bias for EUR/USD is strong, as the price has risen sharply to the 1.1000 key resistance level. Consequently, it trades far above the 30-SMA, showing a steep bullish move. Moreover, the RSI is in the overbought region, an extreme for bullish momentum. The bulls were strong enough to break above multiple resistance levels without pause. –Are you interested to learn more about day trading brokers? Check our detailed guide- However, they are currently facing a level that has led to a previous reversal in the trend. Therefore, the price might start falling from the 1.1000 key level to retest lower support levels. The pullback might drop to the 0.382 Fib retracement level before the uptrend continues. https://www.forexcrunch.com/blog/2023/12/15/eur-usd-outlook-euro-gains-as-ecb-maintains-hawkish-stance/
