2024-01-10 18:30

US DOLLAR, EUR/USD, GBP/USD, NASDAQ 100 FORECAST U.S. dollar softens amid mixed Treasury yields ahead of key U.S. inflation data on Thursday The Nasdaq 100, meanwhile, treks upwards but the move lacks strong conviction, with traders avoiding large directional positions before assessing the next CPI report This article focuses on the technical outlook for EUR/USD, GBP/USD and the Nasdaq 100 Most Read: Gold Price and USD/JPY Forecast - US Inflation Outcome to Drive Market Direction The U.S. dollar was somewhat subdued on Wednesday, displaying weakness against some currencies and strength against others, in a context of mixed Treasury yields ahead of high-impact market events later in the week, including the release of the December CPI and PPI surveys. Tech stocks, meanwhile, traded slightly higher, with the Nasdaq 100 up 0.37% on the session. Although Wall Street’s mood has been positive of late, traders have been reluctant to deploy additional capital into risk assets before assessing the upcoming inflation report, which could guide the Fed’s next steps in terms of monetary policy. Market performance Source: TradingView While annual core CPI is expected to have moderated last month, the all-items indicator is forecast to have reaccelerated, climbing from 3.1% y-o-y to 3.2% y-o-y, an unwelcomed development for the U.S. central bank that is bound to have a negative impact on public opinion and market sentiment in the near term. For stocks to receive the green light to rally and for the U.S. dollar to resume its decline, incoming inflation data needs to show compelling evidence of the U.S. economy making further progress toward price stability. Absent this progress, interest rate expectations could reprice in a hawkish direction, sending yields on a tear. This scenario would benefit the greenback but hurt stocks. Upcoming US Inflation Report EUR/USD TECHNICAL ANALYSIS EUR/USD experienced a downward correction from late December to early January but found stability and rebounded after colliding against channel support around 1.0875. If the rebound picks up pace in the coming trading sessions, overhead resistance is located at 1.1020. On further strength, the focus shifts to 1.1075/1.1095, followed by 1.1140. On the other hand, if sellers re-enter the market and drive the exchange rate lower, the first technical floor to watch emerges at 1.0930 and then 1.0890. Bulls need to defend this zone diligently; failure to do so might prompt a retracement towards the 200-day simple moving average, followed by a descent towards the 1.0770 area. EUR/USD TECHNICAL CHART EUR/USD Chart Prepared Using TradingView For a complete overview of the British pound’s prospects, request your complimentary Q1 trading forecast now! GBP/USD TECHNICAL ANALYSIS GBP/USD ticked up on Wednesday, approaching overhead resistance at 1.2765. Whether the bulls can propel prices above this barrier remains uncertain. However, a successful breakthrough might lead to a rally toward December's highs above the 1.2800 mark. Sustained strength hereon out may bring the spotlight to the 1.3000 handle. Conversely, if GBP/USD reverses lower from its current position, a potential decline towards 1.2675 is a plausible scenario. It's crucial for this support region to remain intact; any breach could empower sellers to initiate a bearish assault on the psychological 1.26000 level. Subsequent losses could attract attention to the 200-day simple moving average. GBP/USD TECHNICAL CHART GBP/USD Chart Prepared Using TradingView If you're looking for an in-depth analysis of U.S. equity indices, our first-quarter stock market trading forecast is packed with great fundamental and technical insights. Get it now! NASDAQ 100 TECHNICAL ANALYSIS The Nasdaq 100 has regained momentum following a notable decline from late December into early January, reclaiming significant levels along the way, a sign that the technical outlook remains bullish. If the rebound extends in the near term, the first ceiling to monitor appears at the all-time high near 17,150. On further strength, a push toward trendline resistance at 17,300 is likely. In the event of a bearish reversal, support can be spotted at 16,750. This floor must hold at all costs; failure to do so could send the tech index back towards 16,400. While prices may bottom out around this area on a pullback, a breakdown could exacerbate downward pressure, setting the stage for a drop towards 16,150 – the 50-day simple moving average. NASDAQ 100 TECHNICAL CHART Nasdaq 100 Chart Prepared Using TradingView https://www.dailyfx.com/news/forex-usd-dollar-yields-mixed-before-us-cpi-setups-on-eur-usd-gbp-usd-nasdaq-100-20240110.html

2024-01-10 16:30

The Japanese Yen Talking Points USD/JPY edges back above the 145.00 mark Japan’s latest wage data cast doubt on durable domestic demand rise US CPI numbers will be the next major market hurdle The Japanese Yen has fallen back to mid-December’s lows against the US dollar on Wednesday as more weak wage data out of Japan weigh on any idea that tighter monetary policy there could be coming anytime soon. Japanese workers’ real, inflation-adjusted wages were found to have slipped for a thirteenth straight month in November, according to official figures. Indeed, they were down an annualized 3%, after falling 2.3% in October. Nominal pay grew by a pretty miserable 0.2%, much less than the 1.5% expected. These data are important for the foreign exchange market because the past few months have seen growing suspicions that the Bank of Japan’s long period of extremely accommodative monetary policy could be coming to an end. Those suspicions helped the Yen gain against the Dollar quite consistently since November 2023. However, the BoJ has always been at pains to point out that any monetary tightening on its part will have to come on hard evidence that demand and inflation in Japan are sustainable. The global wave of inflation which washed around the world last year certainly didn’t spare Japan, but, now that it seems to be subsiding, domestic Japanese pricing power looks as elusive as ever. Those latest wage data appear to underline that fact, and, sure enough, some bets on any early-year tightening from the BoJ seem to have been taken off the table, with the Dollar back above the psychologically important 145-Yen mark. The US Dollar, of course, is also under some pressure thanks to the widely held belief that the Federal Reserve will be cutting interest rates this year, possibly in the first six months. But it has found some support this week in rising Treasury yields. Moreover, even if US borrowing costs start to fall, the Dollar would still offer much more tempting returns than the Yen. In any case, investors must wait until January 23 until the BoJ will make its first policy call of the year. US inflation numbers are the next big market event and they come much sooner, on Thursday. Core consumer prices’ increase is expected to have decelerated in December, but headline inflation is tipped to have risen modestly. The core measure will carry more weight with the markets but there seems little clear reason to expect a near-term reversal in Dollar strength against the Yen in any case. USD/JPY Technical Analysis USD/JPY has risen quite solidly in the last seven daily trading sessions and has in the process broken above a downtrend line preciously dominant since November 10. Still the pair remains within a broad trading range bounded by December 7’s opening high of 147.32 and December 28’s five month intraday low of 140.164. If Dollar bulls can consolidate above the 145.00 handle this week, they will strike out for resistance at the first Fibonacci retracement of the rise up to November’s peaks from the lows of late March. That comes in at 146.54, a level abandoned on December 7 and not reclaimed since. Setbacks will find near-term support at 143.37, January 3’s closing high, ahead of 140.88, the most recent significant low. USD/JPY Daily Chart Chart Compiled Using TradingView IG’s own sentiment data shows traders quite bearish on USD/JPY at current levels, with fully 66% bearish. This seems a little overdone considering the backdrop of fundamental support for USD/JPY even if the prospect of lower US rates is likely to weigh on the Dollar against other currencies. The real picture looks a lot more mixed and is likely to remain so at least until the markets have seen the substance of this weeks’ US inflation figures. Even given its recent vigor, the Dollar doesn’t look at all overbought according the pair’s Relative Strength Index. That is still hovering around the mid-50 mark, well shy of the 70 level which tends to suggest extreme overbuying. --By David Cottle for DailyFX https://www.dailyfx.com/news/japanese-yen-falls-further-on-weaker-wage-data-us-cpi-in-near-term-focus-20240110.html

2024-01-10 14:41

Gold, Silver Technical Analysis US inflation data brings real interest rates into focus Gold traders patiently await US CPI as price action trickles along Silver technical analysis: bearish pennant hints at bearish posturing The analysis in this article makes use of chart patterns and key support and resistance levels. For more information visit our comprehensive education library US Inflation Data Brings Real Interest Rates into Focus The end of 2023 and the start of 2024 presents an environment that is broadly supportive of gold prices. Interest rates are expected to be cut back aggressively, as such, the US dollar and Treasury bond yields have been in broad decline. Since gold is a non-interest-bearing asset, it can often become more appealing during times when interest rates are falling (or expected to fall soon) as the opportunity cost of holding the precious metal declines. The one issue here is if inflation sees further progress and interest rates remain well above 5%. Such a scenario would see real interest rates (nominal interest rate – inflation rate) rise and this can be bad for gold. On a broader macro level, this is why the unemployment rate is so important because a robust labour market fuels consumer spending leading to a situation where inflation struggles to reach 2% and interest rates need to stay higher for longer. Gold Traders Patiently Await US CPI as Price Action Trickles Along Gold has nestled its way to trendline support where it currently hovers ahead of tomorrow’s US inflation data. Not too far below support is the 50 simple moving average (SMA), followed by the $2010 marker but as things stand, gold respects the trendline acting as support. Expectations are for core inflation to breach beneath the 4% mark (3.8%) while headline inflation is anticipated to rise slightly so the potential for a mixed print remains alive, although, it will take a lot to question the disinflation narrative currently underway. Therefore, a strong move higher in the dollar is unlikely, meaning gold could see a lift off of support in the absence of any surprises. One potential risk to a move higher from here is the reluctance to trade higher over the last two days, evidenced by those upper wicks on the daily candle but CPI could provide the catalyst to overcome a prior lack of conviction. Gold (XAU/USD) Daily Chart Source: TradingView, prepared by Richard Snow Silver Technical Analysis: Bearish Pennant Hints at Lower Move Silver trades below the 200 SMA and recent price action has formed a bearish pennant-like formation. Today’s daily close could be telling as it may reveal a breakdown of the pennant pattern, which typically suggests a bearish continuation. In search of greater conviction, a move below the $22.70 level could be assessed. Thereafter the 38.2% Fibonacci retracement of the major 2021 to 2022 decline becomes the next strong level of support ($22.35). Resistance appears at the 200 SMA, followed by the 50% Fib retracement at $23.83. Silver (XAG/USD) Daily Chart Source: TradingView, prepared by Richard Snow The chart weekly below reveals silver price trends through a long-term lens and also highlights the significance of the 38.2% Fib level over time as it has supported price action multiple times before Silver (XAG/USD) Weekly Chart Source: TradingView, prepared by Richard Snow https://www.dailyfx.com/news/gold-silver-price-action-setups-ahead-of-us-cpi-20240110.html

2024-01-10 13:17

Bitcoin (BTC) Prices, Charts, and Analysis: SEC fake X (tweet) shambles add to Bitcoin volatility. Ethereum outperforms Bitcoin after months of losses. Bitcoin (BTC/USD) Pumping Higher as SEC ETF Deadline Nears The Bitcoin ETF decision process took a comical turn yesterday after a false SEC X hit the screens saying that the US regulator had approved a raft of ETFs, only to pull the announcement minutes later saying that their X account had been hacked. SEC False X (Tweet) SEC Retraction The false announcement sent BTC/USD to within touching distance of $48k before the retraction sent Bitcoin tumbling back to the early $45k area. According to Coinglass data, over $93 million Bitcoin longs have been liquidated over the last 24 hours. Coinglass Liquidation Data The keenly awaited SEC decision is set to be announced today and more volatility can be expected. Bitcoin is currently trending lower ahead of the SEC’s decision. Bitcoin One-Hour Price Chart The second-largest cryptocurrency by market capitalization, Ethereum, was seemingly unaffected by yesterday’s SEC drama and instead pushed higher over the session. Ethereum continues to gain against Bitcoin today, although a longer-term series of lower highs and lower lows remains in place. ETH/BTC Daily Chart Charts via TradingView What is your view on Bitcoin – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1. https://www.dailyfx.com/news/bitcoin-etf-decision-d-day-sec-fake-approval-announcement-sparks-btc-usd-volatility-20240110.html

2024-01-10 12:00

Article by IG Senior Market Analyst Axel Rudolph FTSE 100, Nikkei 225, S&P 500, Analysis and Charts FTSE 100 retreats ahead of US inflation print The FTSE 100 has resumed its descent ahead of Thursday’s US CPI and Friday’s UK GDP readings as market participants remain jittery. Downside pressure should remain in play while Monday’s high at 7,725 isn’t overcome. Above it lies resistance between the September and December highs at 7,747 to 7,769. A fall through Monday’s 7,635 low would likely push the mid-October low at 7,584 to the fore as well as the 200-day simple moving average (SMA) at 7,575. FTSE 100 Daily Chart Nikkei 225 trades in 34 year highs as yen weakens The Nikkei 225 shot up to levels last traded in January 1990 as slowing inflation in Japan weakened the yen and as the Bank of Japan (BoJ) is expected to stick to its ultra-loose monetary policy for longer. The psychological 35,000 mark represents the next upside target ahead of the 38,957 December 1989 all-time peak. Potential slips should find support around the 33,865 to 33,815 late November and December highs. Nikkei 225 Daily Chart S&P 500 volatility diminishes ahead of Thursday’s US inflation data The S&P consolidated on Tuesday, following Monday’s surge higher, ahead of Thursday’s US CPI and Friday’s PPI releases. A rise above this week’s high at 4,766 would put the 20 December high at 4,778 on the plate. Further up lurks the late December 4,795 peak. Minor support below Tuesday’s 4,730 low can be spotted along the October-to-January uptrend line and the December 20 low at 4,699 to 4,692 ahead of last Friday’s low at 4,451, made between the November and mid-December 2021 highs at 4,752 to 4,743. S&P 500 Daily Chart https://www.dailyfx.com/news/ftse-100-and-s-p-500-on-hold-while-nikkei-225-hits-34-year-high-20240110.html

2024-01-10 10:39

AUD/USD, NZD/USD Analysis Australian CPI drops in November allaying concerns of resurgent price pressures for now AUD/USD price action ahead of US CPI – longer-term uptrend in tact AUD/NZD tests resistance at 1.0740 and potentially the 200 SMA The analysis in this article makes use of chart patterns and key support and resistance levels. For more information visit our comprehensive education library Australian CPI Drops in November Allaying Concerns of Resurgent Price Pressures for Now Inflation in Australia witnessed a welcome 4.3% rise compared to November last year, narrowly missing out on being the lowest increase in two years. Helped by drops in food prices and transport, mainly due to lower fuel costs. While November marks the second consecutive month of lower inflation, services inflation remains a concern for the RBA as rent inflation accelerated to 7.1% from 6.6% while electricity prices rose to 10.7%. Services inflation will continue to keep policymakers on their toes as they strive to see a repeat of rising inflation like we witnessed between July and September, leaving the RBA with little choice but to hike interest rates in November. Given that Australia’s inflation timeline differs to that of the US and other developed markets, there is an expectation of fewer rate hikes from the RBA this year which may help support the local currency. Markets are expecting a mere 50 basis points worth of cuts this year, potentially starting in August. Implied Interest Rate Probabilities Source: TradingView, prepared by Richard Snow AUD/USD Price Action Ahead of US CPI The Aussie dollar appreciated despite the lower CPI print, a pattern which continued in the hours before the London session began. The US dollar index (USD benchmark) trades slightly lower this morning ahead of US CPI data tomorrow. AUD/USD 5-minute chart Source: TradingView, prepared by Richard Snow AUD/USD continues within the longer-term uptrend but shorter-term price action has sent the pair lower. Today, AUD/USD appears to have found intra-day support at the significant long-term level of 0.6680 ahead of US CPI data tomorrow. A hotter-than-expected print could see a move below 0.6680 and even a retest of the ascending trendline acting as support, while continued disinflation in the US may provide a temporary boost for the Australian dollar which could see the pair recover a portion of recent losses. AUD/USD Daily Chart Source: TradingView, prepared by Richard Snow AUD/NZD tests resistance at 1.0740 and potentially the 200 SMA AUD/NZD has traded within a broader narrowing pattern, exhibiting periods of both consolidation and trend throughout. The trends have been notable but as we near the apex of the narrowing pattern, the potential for extended moves may lessen in the absence of a major catalyst. The Kiwi dollar has a superior yield differential and the pair has been less responsive to 10-year sovereign bond spreads. Both currencies remain affected by the economic misfortunes in China meaning price action is more likely to be impacted by country specific factors like net exports and overall market sentiment (AUD benefits from improved sentiment and higher moves in the S&P 500) . 1.0740 is the imminent level of resistance, followed by the 200 simple moving average (SMA). Support rests at the upward sloping trendline support. Keep an eye on US equity sentiment especially with renewed optimism around the semi-conductor/AI space. AUD/NZD Daily Chart Source: TradingView, prepared by Richard Snow https://www.dailyfx.com/news/aussie-dollar-rises-despite-consecutive-monthly-drop-in-inflation-20240110.html