2024-02-14 23:35

Curious about where the British pound is headed? Explore all the insights in our Q1 trading forecast. Request your free trading guide today! GBP/USD FORECAST - TECHNICAL ANALYSIS GBP/USD extended losses on Wednesday, but narrowly avoided breaking below cluster support at 1.2560, where the 200-day simple moving average converges with a short-term rising trendline. To prevent further deterioration in cable's near-term outlook, bulls need to fiercely defend this area; failure to do so could result in a pullback towards 1.2500 and possibly even 1.2455. In case of a bullish turnaround, the first technical ceiling to consider lies near the psychological 1.2600 mark, followed by 1.2675 (the 50-day simple moving average). Additional gains beyond this point might shift focus to trendline resistance at 1.2735. Continuing upwards, the spotlight will fall squarely on 1.2830. GBP/USD TECHNICAL CHART GBP/USD Chart Created Using TradingView Eager to discover how retail positioning can influence EUR/GBP’s short-term trajectory? Our sentiment guide has valuable insights about this topic. Grab a free copy now! EUR/GBP FORECAST - TECHNICAL ANALYSIS EUR/GBP has been in a sustained downtrend since late December 2023, making impeccable lower highs and lower lows throughout the move, which has resulted in a ~2.5% plunge from peak to trough. This week, the pair fell to its weakest point in nearly six months before mounting a modest comeback after bouncing off a key technical floor around 0.8500. To see an improvement in the euro's position relative to the British pound in terms of market sentiment, it is crucial for the exchange rate to stay above 0.8500. If this condition is not met and prices slip below this region, a rapid descent toward channel support at 0.8465 may ensue. From here onwards, additional losses could direct attention to 0.8400. On the flip side, if EUR/GBP continues to build on its rebound from Wednesday and extends higher in the coming trading sessions, the first obstacle on the road to recovery looms at 0.8570, followed by 0.8590. Above these resistance levels, the 200-day simple moving average is likely to be the next line of defense against a bullish assault. EUR/GBP TECHNICAL CHART EUR/GBP Char Creating Using TradingView Feeling discouraged by trading losses? Take control and improve your strategy with our guide, "Traits of Successful Traders." Access invaluable insights to help you avoid common trading pitfalls and costly errors. GBP/JPY FORECAST – TECHNICAL ANALYSIS GBP/JPY rallied on Tuesday, blasting past its recent high and hitting its best level since August 2015. Prices, however, downshifted the next day, sliding back towards 189.00 when the bulls were unable to take out channel resistance at 190.00. If the reversal accelerates and the pair loses the 189.00 handle in the days ahead, a pullback toward 185.50 could be on the horizon. On the other hand, if GBP/JPY pivots to the upside in the direction of the broader uptrend from its current position, overhead resistance rests near 190.00, as stated before. Although overcoming this technical ceiling might prove challenging for the bullish camp, a clean and clear breakout could lead buyers to set their sights on the 2015 highs near 196.00. GBP/JPY TECHNICAL CHART GBP/JPY Chart Created Using TradingView https://www.dailyfx.com/news/forex-british-pound-outlook-analysis-setups-on-gbp-usd-eur-gbp-and-gbp-jpy-20240214.html

2024-02-14 17:30

US DOLLAR FORECAST – EUR/USD, USD/CAD The U.S. dollar pauses after Tuesday’s strong rally, with the DXY index moving up and down around the flatline The absence of follow-through to the upside doesn’t necessarily signal a loss of conviction in the bullish outlook This article examines the near-term technical outlook for two key pairs: EUR/USD and USD/CAD Most Read: Gold Price, Nasdaq 100, EUR/USD - What Comes Next After US CPI Data? Following Tuesday’s solid performance, the U.S. dollar showed signs of indecision on Wednesday, moving between small gains and losses, but ultimately not going anywhere, with the DXY index trading around the 104.80 level in early afternoon trading in New York. The absence of follow-through to the upside does not necessarily signal that the bulls are losing conviction or are throwing in the towel, but may be a signal of a pause in the uptrend after the strong rally seen this year. After all, trends rarely proceed in a linear fashion without interruption. Looking at the bigger picture, the limited progress on disinflation over the past month means that the Fed could delay the start of its easing cycle and only cut rates modestly when the process starts. Such a scenario could bias yields higher, keeping the U.S. dollar in an upward trajectory after a period of consolidation. Leaving fundamentals aside for the moment, the remainder of this article will be devoted to examining the technical outlook for two major U.S. dollar pairs: EUR/USD and USD/CAD. In this section, we will outline important price thresholds that could act as support or resistance in the coming trading sessions. EUR/USD FORECAST – TECHNICAL ANALYSIS EUR/USD ticked higher on Wednesday, recovering some of the previous session's losses, with prices recapturing the 1.0720 level. If the rebound gains momentum in the coming days, resistance appears around the 1.0800 handle. On further strength, all eyes will be on the 200-day simple moving average. Conversely, if EUR/USD resumes its retracement and slips below 1.0720 on daily closing prices, we could see a possible pullback towards 1.0650, which corresponds to the May 2023 lows. Further weakness beyond this threshold might draw attention to 1.0520. EUR/USD CHART – TECHNICAL ANALYSIS EUR/USD Chart Created Using TradingView Curious about the correlation between retail positioning and USD/CAD’s short-term trajectory? Discover all the insights in our sentiment guide. Request a complimentary copy now! USD/CAD FORECAST - TECHNICAL ANALYSIS USD/CAD paused on Wednesday following Tuesday’s big rally, with prices attempting to consolidate above the 100-day simple moving average. If the advance resumes over the next day days, overhead resistance emerges at 1.3570. From this point, subsequent gains could bring 1.3620 into focus. On the flip side, if sellers return and trigger a bearish reversal from the pair’s current position, initial support can be spotted around 1.3535, followed by 1.3485, a tad above the 200-day simple moving average. Bears must defend this floor tooth and nail; failure to do so could spark a move towards 1.3450. USD/CAD TECHNICAL CHART USD/CAD Chart Created Using TradingView https://www.dailyfx.com/news/forex-usd-dollar-pauses-after-cpi-induced-rally-setups-on-eur-usd-usd-cad-20240214.html

2024-02-14 15:54

Japanese Yen (USD/JPY, GBP/JPY, EUR/JPY) Analysis Japan’s top currency official mentions FX intervention in response to yen weakness USD/JPY tentative above the crucial 150 mark GBP/JPY breakout already struggling for momentum EUR/JPY tests zone of resistance but both currencies The analysis in this article makes use of chart patterns and key support and resistance levels. For more information visit our comprehensive education library Japan’s Top Currency Official Mentions FX Intervention in Response to Yen Weakness Late last night and in the early hours of this morning, Japanese officials attempted to come to the yen’s defence, but stern warnings proved ineffective, for now. Japan’s top currency diplomat Masato Kanda communicated his displeasure around rapid yen moves which he says could have an adverse effect on the economy. Mr Kanda even went as far as to suggest deploying FX intervention as a potential solution to the matter. Japanese officials previously intervened in the FX market in September and October 2022 when it sold dollars and bought yen to strengthen the value of the local currency. It is reported that nearly $20 billion was deployed in an effort to strengthen the yen – which it ultimately did. It was the first dollar, yen intervention in 24 years and it could soon be upon us again should Tokyo tire of repeated warnings. The Japanese Finance Minister Shun’ichi Suzuki weighed in on the matter by reiterating the importance for currencies to move stably and reflect fundamentals and that he is watching FX moves with a strong sense of urgency. However, he stopped short of mentioning FX intervention directly and when asked about it directly, offered no response. The 10-year Japanese Government bond yield gapped higher this morning but the yen has hardly responded. Japanese Government Bond Yield (10-Year) Source: TradingView, prepared by Richard Snow USD/JPY tentative above crucial 150 mark USD/JPY received a lift from yesterday’s hotter-then-expected CPI print, sending the pair above 150, where it trades cautiously. Today, trading has been light, seeing a modest move lower as markets await US retail sales data and consumer sentiment updates on Friday. USD/JPY failed to acknowledge the FX intervention warnings, appearing to take it in its stride. The pair, despite remaining above 150, hardly made a move lower and the bullish posture remains intact. 146.50 is the next level of resistance but may prove difficult to reach unless given a helping hand from US data in the coming days. The RSI is on the cusp on overbought territory meaning a short-term return to 150 is not out of the question. If Japanese officials decide to intervene in the market, the pair could move by as much as 500/600 pips if history repeats itself. So the potential volatility around FX intervention is massive. USD/JPY Daily Chart Source: TradingView, prepared by Richard Snow GBP/JPY breakout already struggling for momentum GBP/JPY printed a fresh yearly high yesterday but is already appearing vulnerable to a move back to 188.80. Sterling is broadly weaker today after CPI data remained unchanged for both the headline and core measures despite estimates pointing to slight moves higher. The RSI approached overbought territory – a mark that previously preceded a move lower and remains something to keep in mind. However, the bullish case remains constructive from a technical perspective but the threat of FX intervention poses a massive threat. Tomorrow morning UK GDP is due and could potentially confirm a technical recession in the UK which could see the pair surrender the remainder of its recent gains. GBP/JPY Daily Chart Source: TradingView, prepared by Richard Snow EUR/JPY tests zone of resistance but both currencies EUR/JPY finds itself pressed up against an immediate zone of resistance at 161.70. The euro has struggled to appreciate and is likely to remain weaker against its peers as rate cut expectations still envision more than 100 basis points worth of cuts this year. However, the yen has proven to be even weaker than the weak euro, allowing the 200 day SMA to act as dynamic support on the way up. 161.79 stands in the way of a bullish continuation towards 164 while support resides back at 157.94. EUR/JPY Daily Chart Source: TradingView, prepared by Richard Snow https://www.dailyfx.com/news/japanese-yen-outlook-fx-intervention-talk-reenters-the-fray-20240214.html

2024-02-14 14:00

The Bitcoin Halving Event is Due in mid-April – What Does this Mean? Bitcoin halving is a scheduled event that occurs approximately every four years, or after 210,000 blocks have been mined. During this event, the reward for mining new blocks is halved, meaning miners receive 50% fewer bitcoins for verifying transactions. Halving is hard-wired into the Bitcoin protocol to ensure that the total supply of Bitcoin is capped at 21 million, thereby introducing scarcity into the ecosystem. The next Bitcoin halving event is expected in mid-April this year. Bitcoin mining is a critical process that underpins the functionality and security of the Bitcoin (BTC) network. Mining involves solving complex mathematical problems to validate transactions and add new blocks to the blockchain. This process is carried out by powerful computers, often referred to as miners, which compete to solve these problems in exchange for rewards in the form of newly minted bitcoins and transaction fees. Mining difficulty adjusts approximately every two weeks, to ensure that the time between blocks remains around 10 minutes, irrespective of the number of miners and their computational power. This difficulty adjustment can influence miner profitability. When prices are high, more miners are incentivized to compete, increasing the hash rate (the total computational power used to mine and process transactions). Conversely, if the price drops and mining becomes less profitable, miners may exit the market, which can decrease the hash rate. If the price of Bitcoin falls below the cost of mining, miners may choose to hold onto their bitcoins rather than sell at a loss, potentially creating a supply crunch. Bitcoin Halving Events Historically Lead to Bullish Market Behaviour. The first Bitcoin halving occurred in November 2012, reducing the mining reward from 50 BTC to 25 BTC. Following the halving, Bitcoin experienced a significant surge in value, going from around$13 to over $1,100 in the next year. The second halving took place in July 2016, when the reward dropped from 25 BTC to 12.5 BTC. After the halving. Bitcoin reached a high of around $20,000 by December 2017. The third halving, in May 2020, reduced the block reward to 6.25 BTC. Bitcoin surpassed its previous all-time high and traded at just over $69,000 in November 2021. Historical Bitcoin Halving Price Action November 28th 2012. Halving Price - $13 --- 2013 Peak Price - $1,125 July 16th 2016 Halving Price - $664 --- 2017 Peak Price - $19,798 May 11th 2020 Halving Price - $9,168 --- 2021 Peak Price - $69,000 With two months to go before the next halving event, Bitcoin is pushing higher, helped in part by the recent launch of 11 spot Bitcoin ETFs. The strong demand for these ETFs has not only underpinned the spot price of Bitcoin but is also driving the price higher as the halving event nears. Bitcoin has regained the $50k level and may look at testing the all-time-high around $69k after the halving event reduces mining rewards by 50%. Bitcoin Weekly Price Chart https://www.dailyfx.com/news/the-next-bitcoin-halving-event-what-does-it-mean-20240214.html

2024-02-14 11:05

Gold (XAU/USD) Analysis Hot January CPI lifts the dollar and US yields but PCE inflation is key Gold sinks, weighed down by higher yields and the US dollar The analysis in this article makes use of chart patterns and key support and resistance levels. For more information visit our comprehensive education library Hot January CPI Lifts the Dollar and US Yields but PCE Inflation is Key After US CPI beat expectations yesterday, both the US dollar and Treasury yields rose. The lift was the latest move within a general trend higher for both asset classes as market participants ease expectations around rate cuts materializing in March and May – now seeing June as the most realistic date for a first cut. US data has consistently beaten expectations for a number of economic indicators, advancing the concern that cutting rates too soon may spur on inflation again. Recent NFP data provided an upside revision to the December jobs number with January’s figure posting a sizeable upward surprise. Q4 GDP, likewise, revealed the US economy is moderating but still seeing strong growth as the final quarter of 2023 grew 3.3% from Q3, much better than the conservative 2% reading anticipated. As long as the economy shows signs of resilience, markets and the Fed are likely to adopt a cautious approach to easing financial conditions. US Dollar Basket vs US 2-Year Yield (blue) Source: TradingView, prepared by Richard Snow While the market places a lot of attention on the CPI reading of inflation, the Fed targets the PCE measure at 2%. Therefore, considering PCE is at 2.6%, the Fed will consider hotter CPI readings but ultimately looks to PCE as their inflation gauge. Powell confirmed that the Fed will look to adjust interest rates ahead of reaching the 2% target meaning in the absence of any external shocks which are likely to reignite inflation pressures, the Fed may actually be closer to a rate cut than many think. Source: Refinitiv, prepared by Richard Snow Gold Sinks, Weighed Down by the Dollar and Yields Post CPI Gold prices had already flirted with a breakdown of the triangle pattern, testing and closing below support. The catalyst that was CPI, then sent the gold price sharply lower in response to the higher dollar and US yields. A higher dollar raises the price of gold for foreign purchasers and higher treasury yields makes the non-interest-bearing metal less appealing. The nearest level of support appears at $1985 – a level that previously acted as resistance during the consolidation of June last year. The big test for bears will be the 200-day simple moving average which sits around $1984. Resistance lies at $2010 if we are to see a pullback of the recent move but momentum still leans in favour of a move to the downside. Gold (XAU/USD) Daily Chart Source: TradingView, prepared by Richard Snow https://www.dailyfx.com/news/gold-sinks-weighed-down-by-the-dollar-and-us-yields-post-cpi-20240214.html

2024-02-14 08:20

GBP/USD Analysis and Charts UK inflation unchanged in January. Price pressures are expected to ease in the coming months. GBP/USD struggling to recover after being hit lower yesterday by a strong US dollar. Most Read: UK Jobs and Earnings Data Give the Pound a Boost – GBP/USD, GBP/JPY UK inflation remained steady in January, according to the latest data from the Office for National Statistics (ONS), but came in marginally below market expectations. According to the ONS, ‘ The largest upward contribution to the monthly change in both CPIH and CPI annual rates came from housing and household services(principally higher gas and electricity Charges),while the largest downward contribution came from furniture and household goods, and food and non-alcoholic beverages. UK inflation is seen falling towards the central bank’s 2% target in the coming months. According to a recent Bank of England publication, UK inflation, ‘could fall to 2% for a short while in the spring before rising a bit after that’, before adding, ‘We can’t say any of this for certain because we can’t rule out another global shock that keeps inflation high.’ UK interest rate cut expectations were trimmed back by a handful of basis points after the inflation report with just under 70 basis points of rate cuts now seen this year. The first 25bp cut is now fully priced in at the August meeting. UK Interest Rate Probabilities Learn how to trade GBP/USD with our free guide Cable remains under pressure after Tuesday’s US CPI-inspired selloff. GBP/USD is trading just above a prior level of support at 1.2547, and just below the 200-day simple moving average, and a break lower would bring the 50% Fibonacci retracement level of the March-July 2023 rally at 1.2471 into focus. GBP/USD Daily Price Chart Chart using TradingView Retail trader GBP/USD data show 52.22% of traders are net-long with the ratio of traders long to short at 1.09 to 1.The number of traders net-long is 0.17% lower than yesterday and 11.06% lower than last week, while the number of traders net-short is 9.11% lower than yesterday and 2.73% lower than last week. What Does Changing Retail Sentiment Mean for GBP/USD Price Action? What is your view on the British Pound – 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/british-pound-gbp-update-uk-inflation-unchanged-in-january-rate-cut-expectations-trimmed-20240214.html