2023-12-13 09:49
Traders are preparing for the conclusion of a Federal Reserve policy meeting. Investors are waiting to see if Powell opposes the idea of interest rate cuts in the first half of 2024. The Bank of Canada could be one of the first central banks to ease in 2024. On Wednesday, the USD/CAD forecast leaned towards optimism, fueled by a slight uptick in the dollar. Traders eagerly anticipated the Federal Reserve policy meeting’s conclusion, where clues about the potential timing of interest rate cuts might unfold. –Are you interested to learn more about ECN brokers? Check our detailed guide- Market expectations point to rates remaining unchanged. Meanwhile, investors are keen to understand the central bank’s economic outlook. Moreover, there are questions about whether Fed Chair Jerome Powell opposes the idea of interest rate cuts in the first half of 2024. Recent indicators suggested a soft landing. However, overnight data revealed an unexpected increase in consumer prices for November. Still, traders are factoring in a quarter-point rate cut in May. Meanwhile, the Canadian dollar has weakened against the US dollar since yesterday due to falling oil prices. Moreover, there is speculation about the Bank of Canada potentially being among the first major central banks to cut rates in the coming months. Notably, the Bank of Canada could be one of the first central banks to ease in 2024. Money markets anticipate the Bank of Canada lowering its benchmark rate, currently at a 22-year high of 5%, as early as April. However, analysts caution that the recent relaxation of financial conditions might hinder the central bank’s ability to control inflation. Additionally, it could delay a shift to rate cuts if it sparks increased activity in the housing market. USD/CAD key events today US core PPI m/m US PPI m/m Fed policy meeting USD/CAD technical forecast: Bulls gear up for another shot at breaking 1.3600 USD/CAD bulls are attempting to break above the 1.3600 key resistance level on the charts. This comes after the price broke above its resistance trendline, signaling weakness in the bearish trend. –Are you interested to learn more about day trading brokers? Check our detailed guide- Moreover, the price trades above the 30-SMA, showing that bulls have strengthened. At the same time, the RSI is above 50, in bullish territory. Therefore, the price will likely surpass 1.3600 to retest the 1.3700 key resistance level. However, there is also a chance that the price will retest the 1.3500 key levels before the trend changes to bullish. https://www.forexcrunch.com/blog/2023/12/13/usd-cad-forecast-dollar-recovers-ahead-of-fed-rates/
2023-12-13 09:38
UK economic data revealed a 0.3% contraction in October. US consumer prices showed a 3.1% year-on-year increase at the end of November. There was a 7.3% year-on-year increase in British earnings, excluding bonuses. Wednesday witnessed a stronger bearish GBP/USD price analysis, as the British pound took a hit following the revelation of a 0.3% contraction in the UK economy in October. This downturn raises the possibility of the Bank of England contemplating an earlier interest rate cut. –Are you interested to learn more about ECN brokers? Check our detailed guide- Notably, the pound has climbed by approximately 3.8% against the dollar this year, its strongest annual performance since 2019. The surge came from the anticipation that the Bank of England may delay rate cuts compared to other central banks. Meanwhile, Tuesday saw the pound grappling for direction as US inflation slowed in November and British wage growth cooled in October. US consumer prices showed a 3.1% year-on-year increase at the end of November, slightly lower than October’s 3.2%. Still, in the European morning session, the pound dipped following data indicating a 7.3% year-on-year increase in British earnings excluding bonuses for the three months to October, down from 7.8% in September. Meanwhile, analysts had expected a decline to 7.4%. The recent data introduces the possibility of a shift in the stance of the three hawks who voted for a hike in November. Chris Turner from ING noted the risk of them now favoring a hold. Economists and traders anticipate a likely 5.25% interest rate hold. However, they will listen attentively for indications of potential future rate cuts. Simultaneously, the Federal Reserve is scheduled to announce interest rates on Wednesday. GBP/USD key events today US Producer inflation FOMC policy meeting GBP/USD technical price analysis: Bears challenge 0.382 fib level The pound is pushing lower after respecting the 30-SMA resistance. The downtrend had paused after the price got to the 0.382 fib level. However, the bearish bias is strong since bears have kept the price below the 30-SMA. Moreover, the RSI has stayed below the 50 mark, supporting bearish momentum. –Are you interested to learn more about day trading brokers? Check our detailed guide- At the moment, bears are retesting the support at the fib level. Soon, the price will likely break below this and the 1.2501 support level to continue the downtrend. The next support zone is at the 0.618 fib and 1.2401 key levels. https://www.forexcrunch.com/blog/2023/12/13/gbp-usd-price-analysis-pound-dives-as-uk-gdp-contracts/
2023-12-12 10:50
The pair rebounded after failing to take out the lower median line. The median line acts as a magnet. Higher US inflation should lift the greenback. The EUR/USD price is trading at 1.0793 at the time of writing. It looks determined to approach the 1.08 psychological level as the US dollar returns to the downside. After its strong downward movement, the price signaled exhausted sellers even if the US reported better than expected data on Friday. Today, the Euro received a helping hand from the Eurozone ZEW Economic Sentiment, which came in at 23.0 points versus 13.3 points expected, and from the German ZEW Economic Sentiment. The indicator was reported at 12.8 points above 9.6 points estimated. Later, the United States economic data should shake the rate, so the sentiment could change again. The US is to release the inflation figures. The Consumer Price Index may announce a 0.0% growth in the last month, the same as in October. CPI y/y could report a 3.1% growth versus the 3.2% growth in the previous reporting period, while the Core CPI is expected to register a 0.3% growth compared to 0.2% growth in October. Higher than expected inflation boosts the greenback, while lower inflation could punish the USD. From the technical point of view, the EUR/USD price found support on the 50% (1.0733) retracement level, invalidating the breakdown below the lower median line (lml) of the descending pitchfork. Now, it challenges the weekly pivot point of 1.0790 and is almost to hit the 38.2% (1.08) retracement level. –Are you interested to learn more about day trading brokers? Check our detailed guide- Failing to take out the lower median line (lml) triggered a potential rebound toward the median line (ml). This acts as a magnet and attracts the price. A larger leg higher could be activated by a valid breakout through this obstacle. https://www.forexcrunch.com/blog/2023/12/12/eur-usd-price-approaching-1-08-ahead-of-us-cpi/
2023-12-12 09:32
The US inflation data will shape the Federal Reserve’s policy decision on Wednesday. US headline inflation for November is expected to remain flat. The interest rate differential between the UK and the US might widen in the coming year. Traders shifted their attention to upcoming US inflation data and various central bank meetings, leading to a decline in the dollar that guided Tuesday’s bullish GBP/USD price analysis. Notably, the US inflation data will shape the Fed’s policy decision on Wednesday. –Are you interested to learn more about ECN brokers? Check our detailed guide- Headline inflation for November will likely remain flat. At the same time, core inflation will likely hold steady at an annual rate of 4%—well above the Fed’s 2% target. The dollar had been sliding since October’s soft US inflation report. However, it stabilized following positive job data released on Friday. Meanwhile, the pound strengthened against the dollar on Monday as investors prepared for a busy week of data releases and central bank meetings, including Thursday’s Bank of England policy meeting. Most market participants anticipate no change to the current bank rate, which is at a 15-year high of 5.25%. As a result, the focus has shifted to when the BoE might cut the Bank Rate. Stuart Cole, the chief macroeconomist at Equiti Capital, attributed Monday’s rise in the pound in part to the underlying expectation that the interest rate differential between the UK and the US will widen in the coming year. Furthermore, the UK will release GDP data on Wednesday for insights into the country’s economic state. On Monday, Make UK, a manufacturing trade body, reported that Britain’s struggling factories show signs of recovery. This is due to the long-awaited restocking and increased export orders, offering potential support to the sector in the challenging year ahead. GBP/USD key events today US Core CPI month-on-month US CPI month-on-month US CPI year-on-year GBP/USD technical price analysis: Bears return as price meets 30-SMA resistance After a strong bullish trend, sentiment has shifted to bearish for GBP/USD. The price is currently making new lows below the 30-SMA. At the same time, the RSI is respecting the pivotal 50 level and staying below in bearish territory. –Are you interested to learn more about day trading brokers? Check our detailed guide- However, the new bearish move has paused at a support zone comprising the 0.382 fib retracement and 1.2501 support levels. This has triggered a rebound to the 30-SMA resistance. Given the bearish bias, the price will likely respect the 30-SMA resistance and bounce lower. Meanwhile, a break below the 1.2501 support would allow the price to retest the 1.2401 support level. https://www.forexcrunch.com/blog/2023/12/12/gbp-usd-price-analysis-dollar-retreats-ahead-of-major-events/
2023-12-12 09:29
Financial markets were calm ahead of the US consumer price index data. Oil prices increased, but investors remained cautious ahead of US inflation data. Speculators have reduced bearish bets on the Canadian dollar. Embark on Tuesday’s market journey, where the USD/CAD outlook took a bearish turn, driven by the Canadian dollar’s ascent amid surging oil prices. Moreover, investor sentiment was shaped by expectations of the Fed holding steady on interest rates on Wednesday. –Are you interested to learn more about ECN brokers? Check our detailed guide- Financial markets were calm ahead of the release of US consumer price index data on Tuesday and the Fed meeting on Wednesday. Both events will shape investor confidence in interest rate cuts next year. The US Federal Reserve will likely keep rates unchanged on Wednesday. However, the November Fed minutes revealed lingering concerns among policymakers about stubborn inflation. Therefore, there is room for additional tightening if necessary. Darren Richardson from Richardson International Currency Exchange noted, “Economists expect the Fed to keep rates steady and begin cutting interest rates in early to mid-2024. Moreover, lower interest rates typically boost risk appetite and weaken the USD.” Given Canada’s significant role as a commodities producer, particularly in oil, the Canadian dollar is sensitive to shifts in risk appetite. Meanwhile, oil prices increased on Tuesday. However, investors remained cautious ahead of crucial interest rate decisions and inflation data releases. Moreover, worries about excess supply and slowing demand growth continued to limit potential gains. Elsewhere, data from the US Commodity Futures Trading Commission on Friday showed speculators reduced bearish bets on the Canadian dollar. USD/CAD key events today US Core Consumer Price Index m/m US Consumer Price Index m/m US Consumer Price Index y/y USD/CAD technical outlook: Price breaks through resistance trendline as bears weaken The pair is trading above its resistance trendline, a sign that bears have weakened, allowing bulls to get the upper hand. However, despite the break above the trendline, bulls are yet to find their footing. The bullish move paused at the 1.3600 key resistance level. Bulls made many attempts to break above this level but failed. –Are you interested to learn more about day trading brokers? Check our detailed guide- Consequently, the price broke below the 30-SMA, and the RSI returned to bearish territory. The price might retest the trendline and make a double bottom before the bulls take over. However, the bearish trend will continue if the price breaks below the 1.3500 support. https://www.forexcrunch.com/blog/2023/12/12/usd-cad-outlook-struggling-under-1-36-amid-surging-oil-prices/
2023-12-11 12:20
Taking out the 1.26 psychological level activates further growth. Its failure to retest the median line (ml) announced exhausted sellers. The US Consumer Price Index should bring sharp movements. The GBP/USD price turned to the upside, trading at 1.2579 at the time of writing. Surprisingly or not, the pair came back higher after reaching Friday’s low of 1.2502, even though the US reported better-than-expected data. –Are you interested to learn more about ECN brokers? Check our detailed guide- The United States Non-Farm Payrolls came in at 199K versus 184K expected, Average Hourly Earnings rose by 0.4%, beating the 0.3% growth estimated, Unemployment Rate dropped unexpectedly from 3.9% to 3.7%, while Prelim UoM Consumer Sentiment was reported higher at 69.4 points versus 62.0 forecasts. Unfortunately for the USD, the US dollar printed temporary retreats after reaching the 104.21 key upside obstacle. Taking out this obstacle activates further growth and helps the greenback to dominate the currency market. Tomorrow, the fundamental factors should have a major impact. The US is to release the inflation figures. The Consumer Price Index could announce a 0.0% growth in November after a 0.0% growth in October. CPI y/y could report a 3.1% growth, while Core CPI is expected to register a 0.3% growth, compared to the 0.2% growth in the previous reporting period. On the other hand, the UK is to release the Claimant Count Change, Average Hourly Earnings, and Unemployment Rate data. From the technical point of view, the GBP/USD pair developed a Falling Wedge chart pattern after failing to take out the median line (ml) of the descending pitchfork. Its failure to retest this dynamic support announced exhausted sellers. –Are you interested to learn more about day trading brokers? Check our detailed guide- As you can see, the price jumped above the downtrend line (pattern’s resistance) and through the upper median line (uml), signaling a new leg higher. Now, it is almost at the weekly pivot point of 1.2590. This stands as a static resistance. Taking out this level and stabilizing above the 1.26 psychological level activates further growth. https://www.forexcrunch.com/blog/2023/12/11/gbp-usd-price-recovers-from-us-nfp-led-losses/
