At the support level, gold has formed a Harami reversal pattern. Currently, the pair can go by the pattern in an ascending wave. The goal of the growth might be the resistance level of 1830.50. After the test of the resistance level, the pair can break through it and continue the uptrend. However, the quotes may pull back to 1800.00 before further growth.
NZDUSD, “New Zealand Dollar vs US Dollar”
On H4, at the support level, the pair has formed a Hammer reversal pattern. The pair may now go by the signal in an ascending wave. The goal of the growth might be 0.6365. After a breakaway of the resistance, the quotes may get a chance for continuing the uptrend. However, the price may pull back to 0.6235 before further growth.
GBPUSD, “Great Britain Pound vs US Dollar”
On H4, at the support level, the pair has formed a Hammer reversal pattern. Currently, the pair may go by the signal in an ascending wave. The goal of the growth is still the resistance level of 1.2190. However, the price may pull back to 1.1960 before continuing the uptrend.
Attention! Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.
This is the last trading week of the year. With many investors closing their books for the year and many traders and managers going on vacation, liquidity will be less than usual. This means the markets may move sharply without any news. The dollar fell against most currencies in trading Friday as recent data signaled that the US Personal Consumption Index (PCE) is slowing, reinforcing expectations for a smaller interest rate hike by the Federal Reserve and improving investors’ appetite for risk. The Fed is expected to raise interest rates by only 25 basis points at its next meeting.
Trading recommendations
Support levels: 1.0549, 1.0483, 1.0361, 1.0332, 1.0284, 1.0193
Resistance levels: 1.0667, 1.0695
The trend on the EUR/USD currency pair on the hourly time frame is bullish. The price is forming a price corridor. The price is forming a wide price corridor. The MACD indicator has become positive, and buyers are again dominating inside the day. Under such market conditions, buy trades are best considered from support levels on intraday time frames, but with additional confirmation. Sell deals can be considered from the resistance level of 1.0667, but better with a confirmation in the form of a reverse initiative or a false breakout.
Alternative scenario: if the price breaks down through the support level of 1.0549 and fixes below it, the downtrend will likely resume.
There is no news feed for today.
The GBP/USD currency pair
Technical indicators of the currency pair:
Prev Open: 1.2025
Prev Close: 1.2046
% chg. over the last day: +0.17 %
A turbulent year for the British pound is coming to an end, and there are a few signs that 2023 will be optimistic. Signs of a painful economic downturn in the UK continue to accumulate, making analysts doubt whether the pound can extend or even sustain its recent rebound against the dollar. The options market is also showing skepticism, with traders still bearish on the long-term outlook. Yield spreads between two- and 10-year swaps tied to the overnight rate, an indicator of recession risks, also point to a longer recession in the UK than in other major economies. Analysts at JPMorgan Chase & Co. predict that the pound will return to $1.14 by the end of the first quarter of 2023.
Trading recommendations
Support levels: 1.2044, 1.1979, 1.1684, 1.1476, 1.1418
From the technical point of view, the trend on the GBP/USD currency pair on the hourly time frame has changed to bearish. The MACD indicator has become positive, but the buyers’ pressure is quite weak. On the other hand, the price managed to return above the moving averages. Under such market conditions, it is better to look for buy trades from the support at 1.2044, but with confirmation on the intraday time frames. Sell trades are best sought from the resistance level of 1.2093, but also better with confirmation.
Alternative scenario: if the price breaks out through the 1.2308 resistance level and fixes above it, the uptrend will likely resume.
There is no news feed for today.
The USD/JPY currency pair
Technical indicators of the currency pair:
Prev Open: 132.67
Prev Close: 132.77
% chg. over the last day: +0.07 %
The market is still dominated by news of the Bank of Japan’s upward revision to its yield curve control policy, which has given a significant boost to the yen and brought short yen futures positions to their lowest level since August. But Bank of Japan (BOJ) Governor Haruhiko Kuroda said on Monday that the BOJ’s decision last week to widen the permissible range around its yield target was intended to reinforce the effect of its ultra-soft policy, not a first step toward canceling a massive stimulus program, and the bank would aim for sustained and stable price targets accompanied by wage increases while continuing to ease monetary policy under yield curve control. Such a statement may return the USD/JPY currency pair bullish as the interest rate differential is not in favor of the yen.
From the technical point of view, the medium-term trend on the currency pair USD/JPY is bearish. The MACD indicator has become inactive, and a narrow price range in the form of a “wedge” pattern is being formed. During the day, there is a slight buyers’ pressure. Buy trades are best considered on intraday time frames from the support level of 132.27, but only with confirmation. Sell deals can be looked for from the resistance level of 133.53, provided there is a reverse reaction.
Alternative scenario: If the price fixes above 137.00, the uptrend will likely resume.
News feed for 2022.12.27:
– Japan Unemployment Rate (m/m) at 01:30 (GMT+2);
– Japan Retail Sales (m/m) at 01:30 (GMT+2).
The USD/CAD currency pair
Technical indicators of the currency pair:
Prev Open: 1.3651
Prev Close: 1.3594
% chg. over the last day: -0.42 %
Canada’s GDP grew by 0.1% over the last month. On the one hand, the economy is still on a growth trajectory. On the other hand, there are signs of a slowdown in GDP growth over the last 3 months. It is highly likely that Canada’s Central Bank will continue to raise the cost of borrowing (interest rate) but will become more “dovish” so as not to hurt the economy too much. Analysts expect a 0.25% rate hike at the next meeting, after which the bank is likely to pause for a few months. The strengthening of the Canadian dollar in recent days is due to rising oil prices.
Trading recommendations
Support levels: : 1.3521, 1.3438, 1.3386, 1.3360, 1.3281, 1.3212
From the point of view of technical analysis, the trend on the USD/CAD currency pair has changed to bullish. But the MACD indicator is in the negative zone, and sellers dominate within the day. Yesterday, the price consolidated below the moving averages, which increases the probability of a change in the trend. Buy trades should be considered from the support at 1.3522, but with a confirmation in the form of a reverse initiative. Sells are best to look for on intraday time frames from the resistance level of 1.3590, but with confirmation in the form of a reverse initiative on the lower time frames.
Alternative scenario: if the price breaks down and consolidates below the support level of 1.3386, the downtrend will likely resume.
This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.
At the support level, gold has formed a Harami reversal pattern. Currently, the pair is going by the pattern in an ascending wave. The goal of the growth might be 1815.00. Upon testing the resistance level, the pair will get the chance to break through it and continue the uptrend. However, the quotes may pull back to 1779.85 before further growth.
NZDUSD, “New Zealand Dollar vs US Dollar”
On H4, at the support level, the pair has formed a Hammer reversal pattern. Currently, the pair is going by the signal in an ascending wave. The goal of the growth might be 0.6365. After the resistance level is broken away, the quotes will get a chance to continue the downtrend. However, the price may pull back to 0.6230 before continuing growth.
GBPUSD, “Great Britain Pound vs US Dollar”
On H4, at the support level, the pair has formed a Hammer reversal pattern. Currently, the pair is going by the signal in an ascending wave. The goal if the growth might be the resistance level at 1.2190. However, the price may pull back to 1.1975 before continuing with the uptrend.
Attention! Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.
Yesterday, US GDP data showed that the US economy increased by 3.2%, higher than the expected 2.9%. This brought back some investor fears about an interest rate hike. The important indicator today will come from the major PCE prices, where a rise in the numbers could put some hawkish pressure back on the markets, causing the dollar index to rise again (EUR/USD to fall). Low liquidity over the holiday period could lead to stronger moves if economic data is significantly different from estimates.
Trading recommendations
Support levels: : 1.0549, 1.0483, 1.0361, 1.0332, 1.0284, 1.0193
Resistance levels: 1.0632, 1.0647, 1.0695
The trend on the EUR/USD currency pair on the hourly time frame is bullish. The price is forming a price corridor. The MACD indicator has become negative, and sellers’ pressure prevails throughout the day. Under such market conditions, buy trades are best considered from the support level of 1.0549 but with additional confirmation. Sell deals can be considered from the resistance level of 1.0632, but it is better with a confirmation in the form of a reverse initiative or false breakout because the level has already been tested.
Alternative scenario: if the price breaks down through the support level of 1.0446 and fixes below it, the downtrend will likely resume.
News feed for 2022.12.23:
– US Core Durable Goods Orders (m/m) at 15:30 (GMT+2);
– US PCE Price index (m/m) at 15:30 (GMT+2);
– US Michigan Consumer Sentiment (m/m) at 17:00 (GMT+2);
– US New Home Sales (m/m) at 17:00 (GMT+2).
The GBP/USD currency pair
Technical indicators of the currency pair:
Prev Open: 1.2074
Prev Close: 1.2039
% chg. over the last day: -0.29 %
In UK GDP revised downward, the actual value is 0.3%. Most services sub sectors showed a slowdown, but output rose by 0.1% in Q3 2022. With the dollar index rising, GBP/USD quotes have declined, and this trend could continue if PCE data today does not point to a slowdown, which could trigger a drop in the dollar index and a rise in GBP/USD quotes.
From the technical point of view, the trend on the GBP/USD currency pair on the hourly time frame is bullish. Yesterday, the price tested the priority change level but failed to consolidate higher. A false breakdown area was formed. The MACD indicator has become inactive, and the volatility on the threshold of the holidays is low. Under such market conditions, it is better to look for buy trades from the support level at 1.2092 but with a confirmation at the intraday time frames. Sell trades are best sought from the resistance level of 1.2218 but also better with confirmation.
Alternative scenario: if the price breaks down from the 1.2092 support level and fixes below it, the downtrend will likely resume.
There is no news feed for today.
The USD/JPY currency pair
Technical indicators of the currency pair:
Prev Open: 132.40
Prev Close: 132.36
% chg. over the last day: -0.03 %
The Bank of Japan surprised investors this week with a change in its Yield Curve Control Policy (YCC). This caused a moderate sell-off in Japanese bonds: the yield on Japan’s 10-year government bonds (JGBs) rose 15 basis points. And this is still having an effect on financial markets and the Japanese yen in particular. New inflation data showed that consumer prices (excluding food energy prices) rose from 3.6% to 3.7% on an annualized basis, the highest level since 1981.
From the technical point of view, the medium-term trend on the currency pair USD/JPY is bearish. The MACD indicator has become inactive, and a narrow price range in the form of a “wedge” pattern is being formed. During the day, there is a slight buyers’ pressure. Buy trades are best considered on intraday time frames from the support level of 132.16, but only with confirmation. Sell deals can be looked for from the resistance level of 133.53, provided there is a reverse reaction.
Alternative scenario: If the price fixes above 137.00, the uptrend will likely resume.
News feed for 2022.12.23:
– Japan National Core CPI (m/m) at 01:30 (GMT+2);
– Japan Monetary Policy Meeting Minutes at 01:50 (GMT+2).
The USD/CAD currency pair
Technical indicators of the currency pair:
Prev Open: 1.3606
Prev Close: 1.3645
% chg. over the last day: +0.28 %
The Canadian dollar is a commodity currency and is highly dependent not only on the monetary policy of the Bank of Canada but also on oil prices. The oil prices decreased yesterday while the dollar index went up, which eventually led to the growth of the USD/CAD. China reiterated its focus on boosting economic growth in 2023, which helped revise the impact of demand for crude oil upwards. Increased demand for oil with limited supply is helping oil prices and the Canadian dollar to strengthen.
Trading recommendations
Support levels: 1.3590, 1.3521, 1.3438, 1.3386, 1.3360, 1.3281, 1.3212
Resistance levels: 1.3656, 1.3700, 1.3776, 1.3855
From the point of view of technical analysis, the trend on the USD/CAD currency pair has changed to bullish. The MACD indicator is in the positive zone, but inside the day, there is a weakness of the buyers. Yesterday, the price made a false breakout of the level 1.3656 resistance level, which will now serve as a sell zone. Buy trades should be considered from the support of 1.3590 but with a confirmation in the form of a reversal. Sell deals are best to look for on intraday time frames from the resistance level of 1.3656, but with confirmation in the form of a reverse initiative on the lower time frames.
Alternative scenario: if the price breaks down and consolidates below the support level of 1.3386, the downtrend will likely resume.
This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.
On H4, the quotes are in the oversold area. The RSI is testing the support level. The quotes are expected to break through 0/8 (0.9277) and grow to the resistance level of 1/8 (0.9399). The scenario can be cancelled by a downward breakaway of the support level of -1/8 (0.9155), in which case the pair may drop to -2/8 (0.9033).
On M15, an additional signal confirming the growth will be a breakaway of the upper line of VoltyChannel.
XAUUSD, “Gold vs US Dollar”
On H4, the quotes are above the 200-day Moving Average, which indicates the prevalence of an uptrend. The RSI is nearing the overbought area. As a result, the quotes are expected to growth to the nearest resistance level of 7/8 (1843.75). The scenario can be cancelled by a downward breakaway of the support level of 6/8 (1812.50). This may drive the price down to 5/8 (1781.25).
On M15, the upper line of VoltyChannel is broken, which confirms the uptrend and increases the probability of price growth.
Attention! Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.
The currency pair is growing inside a bullish channel. The instrument is going above the Ichimoku Cloud, which suggests an uptrend. A test of the lower border of the Cloud at 1.0595 is expected, followed by growth to 1.0870. An additional signal confirming the decline will be a bounce off the lower border of the bullish channel. The scenario can be cancelled by a breakaway of the lower border of the Cloud and securing under 1.0535, which will mean further falling to 1.0445.
USDJPY, “US Dollar vs Japanese Yen”
The currency pair is testing the signal lines of the indicator. The instrument is going below the Ichimoku Cloud, which suggests a downtrend. A test of the Tenkan-Sen line at 132.15 is expected, followed by falling to 127.45. An additional signal confirming the decline will be a bounce off the upper border of the descending channel. The scenario can be cancelled by a breakaway of the upper border of the Cloud and securing above 135.55, which will mean further growth to 136.45.
GBPUSD, “Great Britain Pound vs US Dollar”
The pair is pushing off the support line. The instrument is going below the Ichimoku Cloud, which suggests a downtrend. A test of the Kijun-Sen line at 1.2165 is expected, followed by falling to 1.1835. An additional signal confirming the decline will be a bounce off the lower border of the bullish channel. The scenario can be cancelled by a breakaway of the upper border of the Cloud and securing above 1.2335, which will mean further growth to 1.2425.
Attention! Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.
The Conference Board Consumer Confidence Index in the US jumped to 108.3 from 101.4, beating economists’ forecast of 101.0. The rise in consumer sentiment has eased fears of a US recession. Investors are now waiting for US GDP data for the latest quarter and data on the PCE Index, which is among the US Federal Reserve’s monitored inflation indicators. Growing inflationary pressures may bring panic moods back to the market, which will cause EUR/USD quotes to fall against the background of the dollar’s strengthening.
Trading recommendations
Support levels: 1.0549, 1.0483, 1.0361, 1.0332, 1.0284, 1.0193
Resistance levels: 1.0647, 1.0695
The trend on the EUR/USD currency pair on the hourly time frame is bullish. The price is forming a price corridor. The MACD indicator became positive. Inside the day, purchases prevail. Under such market conditions, buy trades are best considered from the moving averages but with additional confirmation. Sell deals can be considered from the resistance level of 1.0647, but it is better with confirmation in the form of a reverse initiative or false breakout because the level has already been tested.
Alternative scenario: if the price breaks down through the support level of 1.0446 and fixes below it, the downtrend will likely resume.
News feed for 2022.12.22:
– US GDP (q/q) at 15:30 (GMT+2);
– US Initial Jobless Claims (w/w) at 15:30 (GMT+2).
The GBP/USD currency pair
Technical indicators of the currency pair:
Prev Open: 1.2171
Prev Close: 1.2082
% chg. over the last day: -0.74 %
Today, the UK will release GDP data for the last quarter of 2022. Analysts are predicting that the economy will contract by 0.2%, which will be the second quarter of decline, which will mean a technical recession. The UK’s economic outlook remains murky: record inflation, the energy crisis, and strikes suggest that economic indicators will decline throughout the winter.
Trading recommendations
Support levels: 1.2091, 1.2177, 1.2024, 1.1964, 1.1684, 1.1476, 1.1418
Resistance levels: 1.2218, 1.2308, 1.2431, 1.2519
From the technical point of view, the trend on the GBP/USD currency pair on the hourly time frame is bullish. Yesterday, the price tested the priority change level but failed to consolidate higher. A false breakdown area was formed. The MACD indicator has become inactive, and the volatility on the threshold of the holidays is low. Under such market conditions, it is better to look for buy trades from the support level at 1.2092 but with a confirmation at the intraday time frames. Sell trades are best sought from the resistance level of 1.2218 but also better with confirmation.
Alternative scenario: if the price breaks down from the 1.2092 support level and fixes below it, the downtrend will likely resume.
News feed for 2022.12.22:
– UK GDP (q/q) at 09:00 (GMT+2).
The USD/JPY currency pair
Technical indicators of the currency pair:
Prev Open: 131.51
Prev Close: 132.45
% chg. over the last day: +0.71 %
Japan is the world’s largest holder of US Treasuries outside the United States, and benchmark 10-year bond yields rose about 13 basis points in two sessions following the Bank of Japan’s decision. Investors are shorting yen positions and selling them in bond markets around the world. According to analysts, the sale of Japanese bonds could trigger a panicked influx of cash back into Japan, but so far, this is not happening. The overall fundamental picture is starting to change and comes down to expectations that the Bank of Japan will join other central banks in tightening monetary policy next year.
From the technical point of view, the medium-term trend on the currency pair USD/JPY is bearish. The MACD indicator has become inactive, forming a narrow price range. It is better to look for buy trades on intraday time frames from the support level of 131.22, but only with confirmation. Sell deals can be looked for from the resistance level of 133.53, provided that there is a reverse reaction.
Alternative scenario: If the price fixes above 137.00, the uptrend will likely resume.
There is no news feed for today.
The USD/CAD currency pair
Technical indicators of the currency pair:
Prev Open: 1.3610
Prev Close: 1.3612
% chg. over the last day: +0.01 %
Yesterday, new inflation data was released in Canada. The report showed that year-over-year consumer prices fell from 6.9% to 6.8%, while core inflation (which excludes food and energy prices) remained at 5.8% y/y. The key point is that the main components of core price pressures have shown an upward trend, and core inflation remains well above the Bank of Canada’s target, keeping the likelihood of a rate hike at the January meeting high.
Trading recommendations
Support levels: 1.3590, 1.3521, 1.3438, 1.3386, 1.3360, 1.3281, 1.3212
Resistance levels: 1.3656, 1.3700, 1.3776, 1.3855
From the point of view of technical analysis, the trend on the USD/CAD currency pair has changed to bullish. But the price is trading below the moving averages, and the MACD indicator is negative, indicating selling pressure inside the day. At the same time, volatility is decreasing in anticipation of the holidays. Buy trades should be considered from the support level of 1.3590, but with a confirmation in the form of a reversal, currently, there is none. Sell deals are best to look for on the intraday time frames from the resistance level of 1.3656, but with a confirmation in the form of a reverse initiative or after a false breakout, since the level has already been tested.
Alternative scenario: if the price breaks down and consolidates below the support level of 1.3386, the downtrend will likely resume.
This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.
The Japanese yen against the US dollar remains at its four-month peaks. The current quote is 132.00.
The BoJ decided to gain more control over the bond yield, and this decision will be affecting the market for quite long. It corrected long-term interest rates, giving them more space to grow than previously. This mechanism is meant to smooth out the negative consequences of the ultra-soft credit and monetary policy of the regulator and lengthy monetary stimulation.
At the Japanese government level, it has already been announced that this decision of the BoJ means neither cancelling nor giving up the soft credit and monetary policy.
Today the BoJ has announced an extraordinary purchase of bonds for 200 billion yen. 100 billion yen will be spent on 3 to 5 year bonds and 100 billion yen more – on 5 to 10 year bonds.
Attention! Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.
The market major has been consolidating in a narrow range for several days. The current quote is 1.0620.
As was said earlier, EURUSD investors have already got all the facts they might need. Theoretically, situation there must be stable until Christmas.
The statistics from yesterday was quite curious. For example, new house foundations in the US in November did not change, remaining at 1.43 million while 1.40 million had been expected. This is unusual but positive: Americans keep on building houses even when prices are growing. At the same time, the number of construction permits dropped to 1.34 million from 1.51 million. This is normal due to seasonal changes.
All in all, the US real estate sector looks absolutely confident. Demand has never crashed here, though supply is somewhat decreasing. Consumers show no agitation that could appear if they expected real worsening of the economic conditions.
The CCI in the euro zone in December grew to -22 points from -24 points, as expected.
Attention! Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.
ECB officials earlier this week indicated that a 50 bps rate hike at the next meeting is the best-case scenario and is seen as the main scenario within the monetary policy tightening. It is also should ту noted that the ECB decided at its last meeting to start gradually reducing its balance sheet next year. The tightening of monetary policy is usually accompanied by currency appreciation. But investors should also consider the difference between central banks’ interest rates. As long as the US Fed has a higher rate than the ECB, traders should not expect the Euro to strengthen in the medium term.
Trading recommendations
Support levels: 1.0549, 1.0483, 1.0361, 1.0332, 1.0284, 1.0193
Resistance levels: 1.0648, 1.0695
The trend on the EUR/USD currency pair on the hourly time frame is bullish. The MACD indicator has become inactive, volatility is reduced, and the price forms a price corridor. Under such market conditions, it is best to consider buy trades from the support level of 1.0549 but with additional confirmation. Sell deals can be considered from the resistance level of 1.0648, but it is better with a confirmation in the form of a reverse initiative or a false breakout, as the level has already been tested.
Alternative scenario: if the price breaks down through the support level of 1.0446 and fixes below it, the downtrend will likely resume.
News feed for 2022.12.21:
– US CB Consumer Confidence (m/m) at 17:00 (GMT+2);
– US Existing Home Sales (m/m) at 17:00 (GMT+2).
The GBP/USD currency pair
Technical indicators of the currency pair:
Prev Open: 1.2145
Prev Close: 1.2183
% chg. over the last day: +0.31 %
The British pound remains under pressure due to the interest rate differential between the US Federal Reserve and the Bank of England (BoE). The US Fed is holding the rate at 4.5%, while the Bank of England is at 3.5%. The ECB has become more hawkish, and the Bank of England is expected to end monetary policy tightening ahead of the rest. As early as tomorrow, the UK will release its final GDP data for the quarter, and experts believe the economy will contract by 0.2%, indicating a second consecutive quarter of contraction, which is technically considered the beginning of a recession.
Trading recommendations
Support levels: 1.2092, 1.2177, 1.2024, 1.1964, 1.1684, 1.1476, 1.1418
Resistance levels: 1.2218, 1.2308, 1.2431, 1.2519
From the technical point of view, the trend on the GBP/USD currency pair on the hourly time frame is bullish. The price is trading at the level of the moving averages and is approaching the priority change level. The MACD indicator has become inactive, and volatility on the eve of the holidays is reduced. Under such market conditions, it is better to look for buy trades from the support level of 1.2092 but with confirmation on the intraday time frames. Sell trades are best looked for from the resistance level of 1.2218, but also better with confirmation.
Alternative scenario: if the price breaks down from the 1.2092 support level and fixes below it, the downtrend will likely resume.
There is no news feed for today.
The USD/JPY currency pair
Technical indicators of the currency pair:
Prev Open: 136.88
Prev Close: 131.70
% chg. over the last day: -3.93 %
The Bank of Japan changed its yield curve control policy yesterday, raising the ten-year government bond rate target by 25 bps to 0.5%. Raising the bar is a forced measure of tightening monetary policy due to a lack of demand and liquidity in the country’s debt market and capital outflows from Japan to countries. Analysts think that the JPY has all the signs of continuing its strengthening trend as the Bank of Japan is no longer going to tolerate any devaluation of its currency. At the same time, it needs to shift towards policy normalization in order to maintain liquidity.
From the technical point of view, the medium-term trend on the currency pair USD/JPY is bearish. The MACD indicator is deeply negative, without any signs of reversal, but with a sign of oversold. It is best to look for buy trades on intraday time frames from the support of 131.22, but only with confirmation. Sell deals can be sought from the resistance level of 133.53, provided that there is a reverse reaction.
Alternative scenario: If the price fixes above 137.00, the uptrend will likely resume.
There is no news feed for today.
The USD/CAD currency pair
Technical indicators of the currency pair:
Prev Open: 1.3644
Prev Close: 1.3611
% chg. over the last day: -0.24 %
The Bank of Canada announced an increase in dealer limits for overnight repo transactions. The maximum aggregate cash value limit will increase to $5 billion from the previous limit of $1.5 billion per offering. The Bank is increasing these limits to improve the efficiency of its monetary policy implementation operations. OR operations support the effective implementation of monetary policy through intervention and intraday liquidity injections into the overnight general collateral market to reinforce the Bank’s overnight rate target.
Trading recommendations
Support levels: 1.3601, 1.3521, 1.3438, 1.3386, 1.3360, 1.3281, 1.3212
Resistance levels: 1.3700, 1.3776, 1.3855
From the point of view of technical analysis, the trend on the USD/CAD currency pair has changed to bullish. But the price is trading below the moving averages, and the MACD indicator is negative, indicating selling pressure inside the day. Buy trades should be considered from the support level of 1.3601, but with confirmation. Sells are best to look for on intraday time frames from the resistance level of 1.3700, but with confirmation in the form of a reverse initiative or after a false breakout, since the level has already been tested.
Alternative scenario: if the price breaks down and consolidates below the support level of 1.3386, the downtrend will likely resume.
News feed for 2022.12.21:
– Canada Consumer Price Index (m/m) at 15:30 (GMT+2);
This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.
