2023-12-20 12:23
Gold could jump higher as long as it stays above the lower median line. A new higher high activates further growth. The US CB Consumer Confidence should bring high action. The gold price is trading in the red at $2,036 at the time of writing. However, the outlook is neutral in the short-term canvas. The precious metal has changed slightly despite the high-impact data release. –Are you interested to learn more about scalping brokers? Check our detailed guide- It has retreated a little from the yesterday’s top of $2,047 but the upside pressure remains high. The US Housing Starts came in at 1.56M versus 1.36M expected. However, the Building Permits were disappointing in the last session. Furthermore, Canada revealed higher than expected inflation, while the BoJ maintained the monetary policy. Today, the United Kingdom Consumer Price Index reported 3.9% growth, less compared to the 4.3% growth estimated and versus the 4.6% growth in the previous reporting period. In addition, the Core CPI increased only by 5.1% versus 5.6% growth forecasted, while HPI reported a 1.2% drop compared to the 0.0% growth estimated. Later, the US data should impact the markets. The CB Consumer Confidence represents a high-impact event and is expected at 104.6 points above 102.0 points in the previous reporting period. Moreover, the Existing Home Sales and Current Account data should be released as well. Gold Price Technical Analysis: Strong Upside Pressure Gold price is trapped between the $2,047 and $2,015 in the short-term. Its failure to reach the range resistance triggered buyers’ exhaustion. As indicated in the previous analysis that the XAU/USD could extend its growth if it stays above the lower median line (lml) of the ascending pitchfork. –Are you interested to learn about forex robots? Check our detailed guide- Still, only a new higher high, a valid breakout through the range’s resistance of $2,047 can activate an upside continuation. Coming back to test the lower median line (lml) and the $2,015 could bring us new long opportunities. https://www.forexcrunch.com/blog/2023/12/20/gold-price-turns-soft-after-downbeat-uk-inflation-figures/
2023-12-20 09:59
November’s British inflation data fell well below expectations. Markets fully anticipate a 25 basis point Bank of England rate cut in June 2024. Market participants are now pricing in a 69% chance of the first Fed cut in March. Disappointing November British inflation data led to a bearish GBP/USD forecast on Wednesday. The figures, significantly below expectations, have strengthened the perception that Bank of England rate cuts could be on the horizon, leading to a decline in the currency. –Are you interested to learn more about forex options trading? Check our detailed guide- Notably, British annual consumer price inflation dropped to 3.9% from October’s 4.6%, marking the lowest rate since September 2021. Moreover, this figure fell below all forecasts in a poll of economists, which had anticipated 4.4%. Additionally, core inflation unexpectedly cooled, decreasing to 5.1% from 5.7%. Inflation measures remain above the Bank of England’s 2% target. Therefore, the data supports the argument that it is too early to consider interest rate cuts, particularly with core inflation significantly exceeding levels consistent with the target. Currently, markets fully anticipate a 25 basis point Bank of England rate cut in June 2024. At the same time, there is over a 50% chance of a cut in May. On another front, the US dollar held strong on Wednesday as traders assessed the likelihood of Fed rate cuts. The dollar fell following last week’s Federal Open Market Committee meeting, where policymakers projected three rate cuts for 2024. Furthermore, market participants are now pricing in a 69% chance of the first cut occurring at the Fed’s March meeting, followed by a 63.3% probability of another in May. On Tuesday, Richmond Fed President Thomas Barkin stated that the central bank’s ability to fulfill projections of rate cuts depends on the economy’s performance. GBP/USD key events today US CB Consumer Confidence GBP/USD technical forecast: Bears seize control following lower high On the technical side, GBP/USD has broken below the 30-SMA support line after making a lower high. Bulls initially respected the 30-SMA as support but failed to make a higher high to continue the uptrend. Consequently, the price fell back below the 1.2700 key level. Moreover, the RSI broke below 50 and currently supports solid bearish momentum. –Are you interested to learn more about forex tools? Check our detailed guide- However, to confirm this new direction, bears must break below the previous low to make a lower low. If this happens, the price will likely cross below the 1.2601 key support, allowing bears to target the 1.2501 support level. https://www.forexcrunch.com/blog/2023/12/20/gbp-usd-forecast-pound-dips-after-subpar-november-cpi/
2023-12-20 08:37
Data revealed that Canada’s inflation held steady in November. The likelihood of a BoC cut next month fell to 16.0% from 21.4%. Raphael Bostic restated on Tuesday that he anticipated two Fed rate cuts in the latter half of the year. Wednesday’s USD/CAD price analysis revealed a bearish sentiment as investors adjusted their expectations, stepping back from expecting interest rate cuts by the Bank of Canada in the upcoming months. This expectation shift came after domestic data revealed that Canada’s inflation held steady in November. –Are you interested to learn more about forex options trading? Check our detailed guide- Meanwhile, analysts anticipated a decline to 2.9%. Therefore, they were surprised as Canada’s annual inflation rate was 3.1%. Moreover, the core inflation measures, CPI-median and CPI-trim, maintained their levels at 3.4% and 3.5%, respectively. As a result, money markets now indicate a reduced 40% chance of the BoC easing in March, down from the previous 50% before the data release. At the same time, the likelihood of a cut next month dropped to 16.0% from 21.4%. Despite these adjustments, markets still anticipate the central bank to start easing, possibly in April. Additionally, contributing to the rise in the Canadian dollar was the 1.3% increase in the price of oil due to worries about supply disruptions. Meanwhile, the US dollar maintained its stability on Wednesday as traders assessed the likelihood of the US Federal Reserve starting interest rate cuts. Raphael Bostic, the president of the Atlanta Federal Reserve, restated on Tuesday that he anticipated two rate cuts in the latter half of the year. However, he emphasized that there is currently no “urgency” for such actions. USD/CAD key events today The US CB Consumer Confidence report USD/CAD technical price analysis: New low signals exhaustion in the market On the charts, USD/CAD has made a new low below the 1.3301 level, showing the downtrend has progressed. The price is far below the 30-SMA, further supporting bears. However, although the RSI is below 50, showing solid bearish momentum, it has made a bullish divergence. This means that the new low is weaker, and bears are exhausted. –Are you interested to learn more about forex tools? Check our detailed guide- Therefore, bulls might get a chance to retrace the recent decline. Still, since the pullback might come amid a downtrend, it will likely pause at the 30-SMA resistance. The trend can only reverse if bulls are strong enough to break above the SMA. https://www.forexcrunch.com/blog/2023/12/20/usd-cad-price-analysis-investors-reevaluate-boc-rate-cuts/
2023-12-19 13:53
The correction ended above the median line (ml). The upper median line (uml) stands as a major target. The Canadian CPI should bring some action later today. The GBP/USD price edged higher in the short term after reaching yesterday’s low of 1.2628. Now, the pair is trading at 1.2713 at the time of writing. It looks probable to hit new highs as the US dollar is overbought for now. –Are you interested to learn more about forex options trading? Check our detailed guide- Fundamentally, the British pound received a helping hand from the UK CBI Industrial Order Expectations indicator, which came in at -23 points versus -28 points expected and was far above -35 points in the previous reporting period. Later, the US will release the Building Permits and the Housing Starts data. The indicators are expected to report worse data than the previous reporting period. Still, the most important event is the US inflation data. The Consumer Price Index could reveal a 0.1% drop versus the 0.1% growth in the previous reporting period. Tomorrow, the United Kingdom inflation figures could shake the price. The CPI may announce a 4.3% growth versus the 4.6% growth in the previous reporting period, while Core CPI could announce a 5.6% growth in November, less than the 5.7% in October. Also, the US publishes the CB Consumer Confidence as a high-impact event. From a technical point of view, the GBP/USD price was in a short-term corrective phase. It was about to hit the descending pitchfork’s median line (ml), representing a major dynamic support and target. –Are you interested to learn more about forex tools? Check our detailed guide- Coming back above the weekly pivot point of 1.2660 shows sellers’ exhaustion. Now, it is targeting the 1.2748 level (support turned into resistance). Also, the upper median line (uml) represents a major dynamic resistance. So, it remains to see how it reacts around these obstacles. False breakouts may announce a new sell-off. https://www.forexcrunch.com/blog/2023/12/19/gbp-usd-price-recovers-above-1-27-eyes-on-uk-inflation/
2023-12-19 12:03
The Bank of Japan maintained its ultra-loose monetary policy on Tuesday. Some investors were waiting for indications of a potential shift away from negative interest rates. Some Fed officials are pushing back against market expectations of an imminent rate cut. The USD/JPY price analysis turned bullish on Tuesday after the Bank of Japan upheld its ultra-loose monetary policy at the end of a two-day meeting. Moreover, the central bank retained its forward guidance, keeping its dovish stance. –Are you interested to learn more about forex options trading? Check our detailed guide- Consequently, the yen dropped over 0.6% against the US dollar after the decision. Notably, this outcome aligned with market expectations. However, some investors were waiting for indications of a potential shift away from negative interest rates by the dovish central bank. SMBC’s Chief FX Strategist, Hirofumi Suzuki, remarked that there were pre-meeting expectations for policy changes, including modifications in the statement’s wording. Moreover, he noted that the likelihood of a sustained weakening trend in the yen is low. This is due to ongoing expectations for a policy revision between January and March next year. Meanwhile, the BoJ said it was ready to implement additional easing measures if necessary, citing extremely high economic uncertainty. Elsewhere, the US dollar remained largely unchanged at 102.53. Some Fed officials are pushing back against market expectations of an imminent rate cut by the Fed. However, such comments have had minimal impact on market pricing and have not stopped the dollar’s decline. Chicago Fed President Austan Goolsbee emphasized on Monday that the Fed is not pre-committing to an imminent rate cut. Moreover, the surge in market expectations is inconsistent with the usual functioning of the US central bank. USD/JPY key events today Traders will keep absorbing the outcome of the BoJ policy meeting as there won’t be any more major events. USD/JPY technical price analysis: Bullish sentiment emerges as price clears 30-SMA hurdle On the technical side, sentiment has shifted from bearish to bullish as USD/JPY has broken above the 30-SMA. Additionally, the shift can be seen in the RSI, which has crossed well above the pivotal 50 mark. –Are you interested to learn more about forex tools? Check our detailed guide- Notably, the reversal comes after a bullish divergence in the RSI. Sellers weakened when the price reached the 142.02 support level, allowing buyers to push the price above the SMA. However, buyers must break above the resistance trendline for the downtrend to confirm a trend reversal. Moreover, they must make a higher high above the 146.03 key resistance level. Otherwise, sellers might return. https://www.forexcrunch.com/blog/2023/12/19/usd-jpy-price-analysis-boj-maintains-policy-yen-plummets/
2023-12-19 08:39
The Canadian dollar strengthened after the Fed signaled looming rate cuts. Economists predict a slowdown in Canada’s inflation to an annual rate of 2.9%. Oil rose due to attacks by the Iran-aligned Yemeni Houthi militant group on ships in the Red Sea. Tuesday’s USD/CAD outlook was bearish as the resilient Canadian dollar took the spotlight, outshining the declining dollar. The dollar weakened due to expectations of potential rate cuts by the US Federal Reserve in the coming year. Meanwhile, the Canadian dollar got support from rising oil prices. –Are you interested to learn more about forex options trading? Check our detailed guide- On Monday, the Canadian dollar dipped slightly against the US dollar. However, it held near its four-month peak, supported by rising oil prices and anticipation of domestic inflation data. On Friday, the loonie reached its highest level since August 4th at 1.3347. The rise resulted from the Federal Reserve’s signaling of potential interest rate cuts in the coming year, which weighed on the US dollar. Meanwhile, economists predict a slowdown in Canada’s inflation to an annual rate of 2.9% in November from October’s 3.1%. Notably, a higher inflation figure could lead the Bank of Canada to maintain current interest rates for an extended period, further strengthening the Canadian dollar. Despite growing optimism about reaching its 2% inflation target, the Canadian central bank has kept the door open for additional tightening. Elsewhere, oil, a significant Canadian export, saw a 1.5% increase, settling at $72.47 per barrel. This rise was attributed to attacks by the Iran-aligned Yemeni Houthi militant group on ships in the Red Sea, disrupting maritime trade and raising supply costs. USD/CAD key events today Canada’s CPI m/m Canada’s median CPI y/y Canada’s trimmed CPI y/y USD/CAD technical outlook: Bearish momentum weakens in the oversold region On the charts, USD/CAD is recovering after pausing its steep decline at the 1.3350 key support level. However, the bearish bias is still strong because the 30-SMA is above the price and is facing down. At the same time, the RSI is below 50, supporting a bearish trend. –Are you interested to learn more about forex tools? Check our detailed guide- Nevertheless, there is a chance the bullish move will continue higher. The RSI has made a small bullish divergence in the oversold region. Therefore, bears are exhausted, allowing bulls to retrace the recent move. However, the rebound will likely pause at the resistance zone consisting of the 30-SMA and the 0.382 fib retracement level. https://www.forexcrunch.com/blog/2023/12/19/usd-cad-outlook-dollar-weakens-amid-fed-rate-cut-bets/
