Ichimoku Kinko Hyo CNH/JPY: The CNH/JPY pair is trading above the Kumo…
EUR/USD dropped below 1.16 amid little news yesterday
Information is not investment advice
Ichimoku Kinko Hyo
NSD/JPY: The NZD/JPY pair is now trading within the Kumo. Further bullish momentum will lead the pair to exit the cloud with bullish implications. On the other hand, a failed attempt to move higher will push prices to drop and retest the previous low.
European Market View
Equity markets continued their strong run up on Tuesday with several new highs in indices across Europe. The best performing sectors on a day with new all-time highs being utilities and consumer staples. In a less bullish sign, large cap outperforming small cap and VIX ended the day 0.7 points higher. In the other side of the Atlantic, major indices closed as follows: Dow Jones up +0.04%, SP 500 +0.2% and the technology index NASDAQ up by +0.1%. Risk sentiment a bit more negative this morning with most Asian markets lower, Hong Kong continuing to underperform with the Hang Seng index down almost 6% year to date. U.S. futures are flat this morning while European futures are a little weaker.
In the FX space, EUR/USD dropped below 1.16 amid little news yesterday. EUR/GBP moved marginally lower but remains above 0.84.
On Thursday, the 2nd of February, the Bank of England will publish its report concerning interest rates and inflation data for the Eurozone. Professionals and investors anticipate that Andrew Bailey’s lead team of policy makers will likely raise interest rates to 4%; the highest in over a decade, for the tenth time in a row.
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.