Ichimoku Kinko Hyo CNH/JPY: The CNH/JPY pair is trading above the Kumo…
Dollar slightly firmer in European morning Session
Information is not investment advice
Ichimoku Kinko Hyo
CHF/JPY: The pair is trading below the cloud. Downward pressure would lead the pair to exit further the cloud, confirming a bearish outlook.
XAU/USD: Silver after a sell off is trading below 23.6% retracement area. It seems that a bearish flag is formatting.
EU Market View
Asian equity markets traded mostly lower as sentiment gradually deteriorated from the mixed performance stateside. Oil futures traded near two-month highs due to hope for a vaccine and a larger-than-expected drawdown in U.S. crude inventories. U.S. stocks were mixed as investors switched back to technology stocks and away from economically sensitive sectors as they weighed COVID-19 vaccine progress and the likely timing of an economic rebound.
Looking ahead, highlights from the macroeconomic calendar include UK GDP, US CPI and Initial/Continued Jobless Claims, ECB's Lagarde, de Guindos, Mersch Schnabel; Fed's Powell, Williams and Evans, BoE's Bailey speeches. The U.S. dollar edged lower against the yen and yuan as traders adjusted positions before U.S. President-elect Joe Biden takes office next year.
EU Key Point
- UK September monthly GDP comes at +1.1% vs +1.5% m/m than expected
- OPEC reportedly looking to extend current output cuts for another 3-6 months
- Germany reports 21,866 new coronavirus cases in the latest update today
The first FOMC meeting comes after a buildup of anticipation from traders and investors alike, as the markets await what posture the Fed will take regarding the interest rates; would there be a hike or a cut in interest rates? Recall that the Federal Open Market Committee had previously ended the year 2022 with a 50bps hike, and an indication from Powell, the committee chairman, that the Fed could consider raising interest rates by 75bps in the course of the year 2023.
Western countries are trying to find other options for oil and gas supplies after a 10th package of sanctions, which will put more pressure on Russian oil and decrease global oil supply. Italy, for example, is in talks with Libya.
Last year was tough for the Japanese yen. USDJPY gained more than 30% over 2022, striking above 150 in October. While anticipation of slower Fed rate hikes pulled the pair below the 130 level at the start of 2023, the speculations over the destiny of BOJ’s yield control policy grabbed the attention of the Japanese assets in the middle of January. What lies ahead for traders of the Japanese yen?