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Time now: Jun 1, 12:00 AM

Daily Analysis Forex Mix

Gold prices are still under pressure ahead of the Fed rate decision

Yesterday's gold price drew a bearish candle with a small body after previously drawing an indecision candle. Price formed a high of $2658, a low of $2533, and closed at $2644, slightly below the middle band line.

Last week the price of gold began to decline from around $2725 with two consecutive downward candles due to the strengthening of the USD and the influence of the Chinese economy.

Yesterday, gold prices continued their decline amid US economic data which released retail sales rising 0.7%, better than expectations of 0.6%. US Census Bureau reports Advance estimates of U.S. retail and food services sales for November 2024, were $724.6 billion, an increase of 0.7 percent (±0.5 percent) from the previous month, and up 3.8 percent (±0.5 percent) from November 2023.

The dollar index (DXY) has shown a consolidation value in the range of 106.937, slightly up from a low of 106.698. The US dollar traded mixed across foreign exchange exchanges strengthening against commodity currencies such as CAD and AUD and barely falling against European currencies, as the Federal Reserve's monetary policy announcement drew closer. The Fed will announce its decision on monetary policy on Wednesday and is widely anticipated to cut its benchmark interest rate by 25 basis points. The focus will then turn to the Summary of Economic Projections (SEP) and Chairman Jerome Powell's statement on what may happen in 2025.

In China, annual Industrial Production rose 5.4% as expected from 5.3% previously. However, retail sales data showed 3.0% lower than the previous 4.8%, even below market expectations of 5.0%.

Apart from waiting for the important momentum of the Fed's interest rate decision, investors will also focus on UK economic data. The annual CPI is forecast to rise 2.6% from the previous revision of 2.3%.

XAUUSD D1

gold 18 12 2024 d1.png


The price of gold on the daily timeframe is now moving near the middle band line which is often a consolidation line. Bollinger bands drawing a flat channel with deflating band spacing indicates reduced volatility in the sideways market.

The 50 MA above the price draws a flat channel indicating the trend transition is more likely to the downside. The 200 MA is far below the lower band drawing an upward channel indicating an uptrend market.

The VB High TDI indicator shows a value of 61 and VB Low shows a value of 35. The difference of 26 reflects the volatility value in the daily timeframe.

Market Base Line points to a value of 48 with a descending channel, meaning the weight of bearish is greater than bullish.

The RSI Price Line shows a value of 48 with a descending channel crossing the TSL indicating a market downtrend.

Trade Signal Line pointing to the value 53 with a flat channel crossing the MBL from the downside indicates a sideways market with upside potential.

XAUUSD H4

Gold price in the H4 timeframe is now moving between the middle and lower band lines. Bollinger bands draw a descending channel with deflating bands indicating a downtrend with reduced volatility.

MA 50 above the middle band line drawing a flat channel indicates a sideways market with downward potential. However, this indicator has confirmed the golden cross signal when the price was around $2664. The 200 MA below the 50 MA draws a descending channel indicating a market downtrend.

The VB High TDI indicator shows a value of 77 and VB Low shows a value of 27. The difference of 50 reflects the high volatility value in the H4 timeframe.

Market Base Line points to a value of 52 with a descending channel, meaning the weight of bullish is greater than bearish.

The RSI Price Line points to a value of 40 with an upward channel indicating an uptrend market.

Trade Signal Line points to a value of 37 with a flat channel indicating a sideways market.
 
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The Fed cut interest rates by 25 basis points. The USD strengthened sharply afterward

Yesterday the price of Silver (XAGUSD) fell drawing a bearish candle with a long body crossing the lower band and MA 200 from the upper side. Price formed a high of 30,567, a low of 29,305, and closed at 29,348.

In the FOMC Statement released on December 18, the Fed decided to lower the target range for the federal funds rate by 25 bps to 4.25% – 4.50%, in line with analyst expectations. The Fed noted that inflation has made progress toward its 2% target but remains high. The central bank believes that the risks to achieving its employment and inflation targets are broadly balanced.

The Fed also projects that the change in real GDP in 2024 is expected at 2.5%, The forecast for 2025 was increased from 2.0% to 2.1%. Unemployment Rate projection for 2025 is estimated to be lower at 4.4% to 4.3%. Meanwhile, the projected federal funds rate for 2025 was increased from 3.4% to 3.9%. The 2026 estimate was also increased from 2.9% to 3.4%.

The dollar index (DXY) strengthened sharply from a low of 106,823 to a high of 108,269 as traders focused on the Fed's economic projections. Changes in the projected federal funds rate have led to bullishness in the US dollar.

As a result, many major currencies depreciated against the USD, including silver prices which fell after the Fed lowered interest rates by 25 basis points.

Today investors will also wait for other important economic news. The Bank of England rate is predicted to remain unchanged at 4.75%. Meanwhile in the US we will be waiting for the release of GDP and Unemployment Claims data which might change market direction.

XAGUSD D1

silver 19 12 2024 d1.png


Silver price on the daily timeframe is now moving below the lower band line. Bollinger bands expand indicating volatility has increased. Price even managed to cross the 200 MA from the upside.

MA 50 below the upper band line draws a flat channel indicating a sideways market. The 200 MA near the lower band draws a slight upward channel indicating an uptrend market.

The VB High TDI indicator shows a value of 54 and VB Low shows a value of 35. The difference of 19 reflects the volatility value in the daily timeframe.

Market Base Line points to a value of 45 with a descending channel, meaning the weight of bearish is greater than bullish.

The RSI Price Line shows a value of 38 with a descending channel crossing the TSL and MBL from the upper side indicating a downtrend market.

Trade Signal Line points to a value of 46 with a downward channel indicating a market downtrend.

XAGUSD H4

Silver price in the H4 timeframe has broken out the lower band line out of the line. Expanding Bollinger bands indicate increased market volatility.

MA 50 above the upper band draws a descending channel indicating a market downtrend. The 200 MA below the 50 MA draws a descending channel indicating a market downtrend.

The VB High TDI indicator shows a value of 56 and VB Low shows a value of 20. The difference of 36 reflects the volatility value in the H4 timeframe.

Market Base Line points to a value of 38 with a descending channel, meaning the weight of bearish is greater than bullish.

The RSI Price Line points to a value of 25 with a descending channel crossing the TSL from the upper side indicating a downtrend market in the oversold zone.

Trade Signal Line points to a value of 34 with a downward channel indicating a market downtrend.
 
The Japanese yen weakened more against the US dollar

The price of the USDJPY pair yesterday drew a long-body bullish candlestick with a slight shadow on the top candle. Price formed a low of 154,439, a high of 157,807, and closed at 157,396. The rise in the USDJPY pair and even breaking the upper band line indicates a strong rally.

The weakening of the Japanese Yen was due to the strengthening of the US dollar after the Fed lowered interest rates yesterday and the US economic projections in the FOMC statement which received a market response have brought the dollar index (DXY) up from a low of 106,823 to now at a high of 108,103 for two days in a row.

The Fed projects two rate cuts in 2025 which sends US Yields and the USD soaring.

On the other hand, the BOJ kept its benchmark interest rate unchanged at 0.25% with Governor Ueda failing to clarify whether they will raise interest rates in January, as had been anticipated by some market sources. According to Ueda, prolonged easing conditions could cause a spike in inflation.

From within the country, Japanese politics may have an impact on the Japanese Yen. The ruling Liberal Democratic Party (LDP) does not have a majority in parliament, it could be forced to call new elections. A clearer win for the LDP would ensure stability and potentially strengthen the Yen.

However, if the opposition ultimately succeeds and returns to leading there is possibility for fiscal expansion that could weaken the currency.

If the government continues without elections, it is likely that the budget will not be so high as to maintain the currency.

Today, investors focusing at the US Core PCE (Personal Consumption Expenditures) Price Index, one of the Fed's most widely used inflation indicators, which is expected to fall 0.2% from the previous 0.3%.

USDJPY D1


USDJPY 20 12 2024 D1.png

The USDJPY pair on the daily timeframe is moving above the upper band line. A strong rally occurred in this pair and the upper band line was broken. Bollinger bands expand indicating volatility has increased.

MA 50 near the middle band line crosses MA 200 from the downside indicating a golden cross signal. MA 200 draws a flat channel indicating a sideways market.

The VB High TDI indicator shows a value of 70 and VB Low shows a value of 38. The difference of 32 reflects the volatility value in the daily timeframe.

Market Base Line shows a value of 54 with a flat channel, meaning the weight of bullish is greater than bearish.

RSI Price Line is pointing at 70 with an ascending channel crossing the MBL from the downside indicating an uptrend in the overbought zone.

Trade Signal Line pointing at the value 62 drawing an ascending channel crossing the MBL from the downside indicates an uptrend market.

USDJPY H4

The USDJPY pair in the H4 timeframe is now moving near the upper band line. Expanding Bollinger bands indicate increased market volatility.

MA 50 crosses MA 200 from the downside confirming the golden cross signal. MA 200 below MA 50 draws a flat channel indicating a sideways market.

The VB High TDI indicator shows a value of 79 and VB Low shows a value of 51. The difference of 28 reflects the volatility value in the H4 timeframe.

Market Base Line points to a value of 65 with a flat channel, meaning the weight of bullish is greater than bearish.

RSI Price Line is pointing at 78 with a curved channel on the downside indicating a possible reversal in the overbought zone.

Trade Signal Line points to a value of 77 with an upward channel indicating an uptrend market.
 
Will gold shine even more towards the end of the year?

The price of gold on Friday last week drew a bullish candle with a fairly long body. Price formed a high of $2631, a low of $2589, and closed at $2622 on FXOpen.

Throughout 2024, the price of gold experienced a significant price increase until finally drawing a new all time high in 2024.

Gold's journey as a safe-haven asset throughout 2024 received a positive boost amid the Gaza and Ukraine conflicts and central bank purchases.

This year the central bank has also reduced interest rates in a number of countries, which has contributed to gold's performance. India's decision to reduce gold import duties to the lowest level has also contributed to gold demand in the last decade.

In November when Trump won the 2024 US election, gold came under pressure from the strengthening USD until it fell from its highest level, dampening the hopes of some investors who expected gold to rise further. Gold, which had previously risen, suddenly turned down, stopping its previous winning streak.

At the Fed meeting last December, the US central bank lowered interest rates by 25 bps. Gold prices tried to stretch again, on Friday weekend the price formed a bullish candle trying to recover from previous losses.

Even though the Fed cut interest rates by 25 bps, the revised Summary of Economic Projections (SEP) or dot plot, shows that policymakers see the policy rate at 3.9% by the end of 2025, implying a 50 bps cut over the course of the year, compared to with 100 bp projected in the September SEP.

A slower decline may reduce the pace of gold demand, as bond yields may be more attractive than maintaining gold exposure.

In 2025, gold may face the obstacles of the Fed's monetary policy decisions, Trump's economic and foreign policies, and geopolitical risk changing being the main drivers.

On the other hand, China, which is a global gold importer, is also being challenged by Trump's increase in tariffs and may retaliate in a trade war which will allow the economy to slow down and reduce demand for gold.

XAUUSD D1

gold 23 12 2024 d1.png


The price of gold on the daily timeframe is now moving below the middle band line. Bollinger bands draw a flat channel with rather narrow band spacing reflecting moderate volatility.

MA 50 above the middle band line draws a flat channel indicating a sideways market. The 200 MA is far below the lower band drawing an upward channel indicating an uptrend market.

The VB High TDI indicator shows a value of 57 and VB Low shows a value of 35. The difference of 22 reflects the volatility value in the daily timeframe.

Market Base Line points to a value of 46 with a descending channel, meaning the weight of bearish is greater than bullish.

The RSI Price Line points to a value of 45 with an upward channel indicating an uptrend market.

Trade Signal Line pointing to the value 45 with a descending channel crossing the MBL from the upper side indicates a downtrend market.

XAUUSD H4

Gold price in the H4 timeframe is now moving near the middle band line. Bollinger bands draw a descending channel with wide band spacing indicating a downtrend with high volatility.

MA 50 below the upper band draws a descending channel indicating a market downtrend. The 200 MA below the 50 MA draws a descending channel indicating a market downtrend.

The VB High TDI indicator shows a value of 47 and VB Low shows a value of 29. The difference of 18 reflects the volatility value in the h4 timeframe.

Market Base Line shows a value of 38 with a flat channel, meaning the weight of bearish is greater than bullish.

RSI Price Line shows a value of 49 with a flat channel indicating a sideways market.

The Trade Signal Line points to the value 44 with an upward channel crossing the MBL from the lower side indicating an uptrend market.
 
USDCHF rose around 0.90018 as USD strengthened.

The USDCHF pair yesterday drew a bullish candle with a long body almost the same as the length of the previous bearish candle. USDCHF price formed a low of 0.89216, a high of 0.90018, and closed at 0.89835. The pair is attempting a recovery from Friday's weekend losses.

The US dollar recovered as traders expected the Fed to hold interest rates steady in January. The dollar index (DXY) which tracks the US dollar against six major currencies is now at 108.079 slightly up from a low of 107.684.

The Fed's latest dot plot shows it sees the Federal Funds rate heading to 3.9% in 2025. According to the CME group's Fedwatch tool, the probability of the Fed leaving interest rates unchanged at its January 29, 2025 meeting is 93.6% and the probability of a 25 bps cut is only 6.4%.

Fed policymakers are expected to take a cautious approach to rate cuts due to uncertainty over Trump's upcoming policy.

Meanwhile, the Swiss National Bank (SNB) is predicted to loosen monetary policy further amid concerns that inflation is below the bank's 2% target. The SNB has lowered interest rates by 125 basis points (bp) this year to 0.5%.

Today there is no important news on the economic calendar ahead of Christmas, allowing trading volume to be uncertain.

USDCHF D1

USDCHF 24 12 2024 D1.png


The USDCHF pair on the daily timeframe is now moving below the upper band line. Bollinger bands are drawing a slight ascending channel with wide band spacing indicating somewhat high volatility.

MA 50 above the lower band draws an upward channel indicating an uptrend market. The 200 MA above the 50 MA draws a flat channel indicating a sideways market.

The VB High TDI indicator shows a value of 71 and VB Low shows a value of 50. The difference of 21 reflects the volatility value in the daily timeframe.

Market Base Line shows a value of 61 with a flat channel, meaning the weight of bullish is greater than bearish.

The RSI Price Line is pointing at the value 62 with the rising channel crossing the MBL from the lower side indicating an uptrend.

Trade Signal Line points to a value of 63 with a flat channel indicating a sideways market.

USDCHF H4

The USDCHF pair in the H4 timeframe is now moving slightly above the middle band line. Bollinger bands draw a slight upward channel with wide band spacing indicating an uptrend with high volatility.

MA 50 above the lower band draws an upward channel indicating an uptrend market. MA 200 below the lower band draws an upward channel indicating an uptrend market.

The VB High TDI indicator shows a value of 71 and VB Low shows a value of 45. The difference of 26 reflects the volatility value in the H4 timeframe.

Market Base Line shows a value of 58 with a flat channel, meaning the weight of bullish is greater than bearish.

RSI Price Line shows the value 59 with a flat channel crossing TSL and MBL from the lower side indicating an uptrend pause.

Trade Signal Line points to a value of 54 with an upward channel indicating an uptrend market.
 
Bitcoin increases even ahead of Christmas

When the forex market is more sluggish due to the decline in trading volume ahead of Christmas, it is different from Bitcoin in the crypto market. BTCUSD rose yesterday drawing a bullish long-body candle indicating a strong rebound. BTCUSD formed a low at 93528 high of 99444 and closed at 98401.

Before Christmas, several banks closed in Europe, such as Germany, which closed early, the impact on the forex market was quite significant, reducing transaction volume and market volatility. Several pairs such as Gold, Silver, EURUSD, USDJPY, and GBPUSD, are seen moving steadily sideways near the previous open. In contrast to the Bitcoin market which seems to experience different market patterns compared to forex. Bitcoin yesterday tried to rebound after consecutive declines after the Fed projected 2025 interest rates.

Major changes in Bitcoin are influenced by Bitcoin whales such as Micro Strategy, and BlackRock. Micro Strategy, for example, dared to purchase Bitcoin worth $516 million BTC even though Bitcoin prices were already high. It seems they are optimistic about Bitcoin's future potential. Moreover, Elon Musk, who is part of Trump's cabinet, is an influential figure in the Bitcoin market, which allows him to influence Trump's looser policies in the crypto market. Now Micro Strategy's holdings have reached 444 262 BTC.

Meanwhile, community sentiment on Coinmarketcap shows bullish expectations with 79% of votes and 21% of votes for bearish. This means that the majority of people in this community still believe in the bullish prospects for Bitcoin in the future. Meanwhile, the Fear and Greed indicator points to number 55 which is closer to the neutral position. The value of this indicator indicates the level of fear and greed for an asset. A value of 100 is considered market extremely greedy and the possibility of correction. A value of 0 means the market is extremely fearful and the a possibility of a rebound.

Today is Christmas, a holiday for many global banks in the world, allowing for a decrease in transactions on financial markets. However, the crypto market is different from forex, they are mostly traded on exchanges and operate 7 days a week.

BTCUSD D1

BTCUSD 25 12 2024 D1.png


BTCUSD price on the daily timeframe is now moving near the middle band line. Yesterday the price drew a bullish candle trying to rebound after the previous week's consecutive decline. Bollinger bands draw a flat channel with moderate band spacing indicating sideways with moderate volatility.

MA 50 below the price draws an upward channel indicating an uptrend. The 200 MA is far below the 50 MA drawing a slight upward channel indicating an uptrend.

The VB High TDI indicator shows a value of 77 and VB Low shows a value of 46. The difference of 31 reflects the volatility value in the daily timeframe.

Market Base Line points to a value of 62 with a descending channel, meaning the weight of bullish is greater than bearish.

The RSI Price Line shows a value of 52 with an upward channel crossing the TSL from the lower side indicating an uptrend market.

The Trade Signal Line points to a value of 47 with a flat starting channel indicating a potential trend transition.

BTCUSD H4

BTCUSD's price in the H4 timeframe is now moving near the upper band line. Here the Bollinger bands draw a flat channel with wide bands indicating a sideways market with high volatility.

MA 50 near the upper band line drawing a descending channel indicates a downtrend market. MA 200 is slightly below the upper band drawing a flat channel indicating a sideways market.

The VB High TDI indicator points to a value of 52 and VB Low points to a value of 26. The difference of 26 reflects the volatility value in the H4 timeframe

Market Base Line points to a value of 39 with an upward channel, meaning the weight of bearish is greater than bullish.

The RSI Price Line crosses the MBL from the downside pointing to a value of 58 with a flat starting channel indicating a potential trend transition.

The Trade Signal Line points to the value 48 with an upward channel crossing the MBL from the lower side indicating an uptrend market.
 
The EUR/USD pair is forecast to be flat due to the Christmas holidays

In today's trading, the EURUSD pair opened with a slight gap. The open price at 1.04201 was higher than the previous closing of 1.03922 on FXOpen. EURUSD price movements ahead of Christmas look flat. This pair drew a small bearish candle with a low of 1.03836, a high of 1.04100, and a close of 1.03922.

Today it is estimated that the EURUSD pair will still be influenced by the Christmas holidays in various countries. Even though trading is enabled on this pair for today's trading, perhaps many traders are also still celebrating and enjoying the Christmas holidays. Today's calendar schedule shows bank holidays in New Zealand, Australia, Switzerland, Germany, Italy, and the UK which are likely to greatly reduce transactions in the forex market.

Even though there will be the release of US Unemployment Claims which is expected to increase by 223k from the previous 220k, perhaps many investors will not respond due to the holiday period.

The dollar index (DXY) at 108.123 ahead of Christmas shows a small doji candle indicating market indecision. Referring to the EMA 20 line which draws an upward channel below the price, DXY strengthened more.

ECB's Lagarde said she was confident inflation would return to the bank's target of 2% sooner than previously forecast.

Meanwhile, in the latest dot plot, the Fed indicated only two interest rate cuts in 2025. The Fed will make two interest rate cuts of 25 bp at the June and September policy meetings.

EURUSD D1

EURUSD 26 12 2024 D1.png


The EURUSD pair on the daily timeframe is now moving between the middle and lower band lines. Bollinger bands draw a descending channel with expanding band spacing indicating high volatility.

MA 50 near the upper band line draws a descending channel indicating a market downtrend. The 200 MA is far above the 50 MA drawing a flat channel indicating a sideways market.

The VB High TDI indicator shows a value of 46 and VB Low shows a value of 28. The difference of 18 reflects the volatility value in the daily timeframe.

Market Base Line points to a value of 37 with a flat channel, meaning the weight of bearish is greater than bullish.

RSI Price Line shows a value of 37 with a flat channel indicating a sideways market.

Trade Signal Line points to a value of 36 with a flat channel indicating a sideways market.

EURUSD H4

The EURUSD pair in the H 4 timeframe is now moving near the middle band line. Bollinger bands drawing a flat channel with deflating bands indicate reduced volatility in the sideways market.

MA 50 near the upper band line draws a descending channel indicating a market downtrend. The 200 MA is far above the 50 MA drawing a descending channel indicating a market downtrend.

VB High TDI Indicator shows a value of 53, VB Low shows a value of 29. The difference of 25 reflects the volatility value in the H4 timeframe.

Market Base Line shows the value 41 with a flat channel, meaning the weight of bearish is greater than bullish.

RSI Price Line shows a value of 44 with a flat channel indicating a sideways market.

Trade Signal Line points to a value of 43 with a flat channel indicating a sideways market.
 
USDJPY extends to rise post-Christmas

The USDJPY currency pair yesterday drew a bullish candle continuing the JPY's weakness amid fading expectations of a BoJ interest rate hike. Price draws a slightly long-body bullish candle past the previous high. Price formed a high of 158,082, a low of 157,069, and a close of 167,991.

BOJ Governor Kazuo Ueda left open the possibility of waiting longer for the next hike and said the central bank would need more information on wage trends. Additionally, the BoJ's October policy meeting minutes stressed the need for caution amid domestic and global uncertainty. However, widespread inflationary pressures in Japan could force the BoJ to raise interest rates again in early 2025.

Japanese inflation data increased in November, opening up the opportunity for the BoJ to raise interest rates in January or March. Meanwhile, the US central bank signaled that it will slow the pace of interest rate cuts next year and dampened expectations of a sharp narrowing in the US-Japan interest rate gap. This is another factor that weakens the lower-yielding JPY.

However, speculation has emerged that the Japanese government could intervene to shore up its domestic currency which could limit JPY's weakness. Japanese Finance Minister Katsunobu Kato warned against excessive foreign exchange movements and emphasized that the government is ready to act to stabilize the domestic currency.

On the other hand, fears of a trade war triggered by Trump may restrain traders from placing bearish bets on JPY as a safe haven currency.

Next, traders will anticipate core CPI, retail sales, and employment data which will be released today to get a picture of the Japanese economy which might be a clue to the central bank's next policy.

USDJPY D1

USDJPY 27 12 2024 D1.png


USDJPY price now on the daily timeframe is moving near the upper band line. Here the Bollinger bands draw a flat channel with expanding bands indicating the price has deviated far from the average.

MA 50 near the middle band line drawing an upward channel indicates an uptrend market. The 200 MA is slightly below the 50 MA drawing a flat channel indicating a sideways market with a potential uptrend.

The VB High TDI indicator shows a value of 72 and VB Low shows a value of 38. The difference of 36 reflects the volatility value in the daily timeframe.

Market Base Line points to a value of 55 with a flat channel, meaning the weight of bullish is greater than bearish.

RSI Price Line shows a value of 69 with a flat channel indicating a sideways market.

Trade Signal Line points to a value of 67 with an upward channel indicating an uptrend market.

USDJPY H4

USDJPY price in the H4 timeframe is now moving slightly below the upper band line. Bollinger bands draw a slight upward channel with narrow band spacing indicating bullish potential with low volatility.

MA 50 below the lower band draws an upward channel indicating an uptrend market. MA 200 below MA 200 drawing a flat channel indicates a sideways market. MA 200 is often used to project long-term trends.

The VB High TDI indicator shows a value of 78 and VB Low shows a value of 58. The difference of 20 reflects the volatility value in the H4 timeframe.

Market Base Line shows a value of 68 with a flat channel, meaning the weight of bullish is greater than bearish.

RSI Price Line shows a value of 69 with a flat channel indicating a sideways market.

Trade Signal Line points to a value of 68 with a flat channel indicating a sideways market.
 
EUR/JPY is trading with low volume on Friday

The EURJPY pair drew a small bearish candle on Friday after Japan released inflation and employment data. Price formed a high of 164,819, a low of 164,017, and closed at 164,428 on FXOpen.

Japan released core CPI data on Friday which showed it was higher than the previous period but lower than expected. Core CPI came in at 2.4% from the expected 2.5% and previous data of 2.2%. Meanwhile, Japan's unemployment rate remained the same as the previous period at 2.5% as expected. Meanwhile, annual retail sales showed 2.8%, higher than the previous 1.3%, and exceeded expectations of 1.5%.

On the other hand, the BOJ highlighted the possibility of a gradual increase in interest rates if inflation has the potential to reach 1.0% in fiscal 2025. The BOJ also highlighted the focus on developing wages, service prices, and personal consumption as considerations for increasing interest rates. This is in line with BOJ Governor Kazuo Ueda's statement that the central bank will wait for further data on whether wage growth can maintain its upward momentum next year, to get better clarity on economic trends.

Apart from that, Japan will focus on US economic developments and the policies taken.

Meanwhile, the ECB has moved closer to its goal of sustainably reducing inflation to its medium-term target of 2%. However, Lagarde will continue to pay particular attention to inflation in the services sector. One of the ECB officials, Boris Vujcic, told Bloomberg that the ECB plans to continue lowering borrowing costs in 2025.

Today, looking at the economic calendar schedule, Japan will release the Final Manufacturing PMI which is expected to be the same as previously at 49.5. Meanwhile, Spain will release the annual Flash CPI which is expected to rise 2.6% from the previous 2.4%.

EURJPY D1

eurjpy 30 12 2024 d1.png


On the daily timeframe, the EURJPY pair is now moving below the upper band line. Bollinger bands draw a slight upward channel with wide band spacing indicating high volatility market.

MA 50 below the price draws a flat channel indicating sideways with bullish potential. The 200 MA near the price draws a flat channel indicating a sideways market.

The VB High TDI indicator shows a value of 64 and VB Low shows a value of 27. The difference of 37 reflects the volatility value in the daily timeframe.

Market Base Line points to a value of 46 with an upward channel, meaning the weight of bearish is greater than bullish.

The RSI Price Line shows a value of 64 with an upward channel indicating an uptrend market.

Trade Signal Line points to a value of 62 with an upward channel indicating an uptrend market.

EURJPY H4

On the H4 timeframe the EURJPY pair is now moving near the upper band line. Here the Bollinger bands draw an upward channel with slightly widening bands indicating a potential increase in volatility.

MA 50 near the lower band draws an ascending channel indicating an uptrend market. There is a golden cross signal from the intersection of the MA 50 and MA 200 from the bottom side. The 200 MA draws a flat channel some distance below the lower band inicates sideways market.

The VB High TDI indicator shows a value of 69 and VB Low shows a value of 56. The difference of 13 reflects the volatility value in the H4 timeframe.

Market Base Line points to a value of 63 with an upward channel, meaning the weight of bullish is greater than bearish.

The RSI Price Line shows a value of 63 with a descending channel crossing the TSL from the upper side indicating a downtrend market.

Trade Signal Line points to a value of 66 with a downward channel indicating a market downtrend.
 
Ahead of the new year the price of the Chinese Yuan weakened

USD/CNH prices in Monday's trading session showed USD strengthening against CNH and drawing a bullish long-body candle after the previous week moved in a narrow space during the Christmas holidays. USDCNH price formed a high of 7.3192, a low of 7.2935, closing at 7.3151.

The Chinese Yuan currency still faces significant challenges as a sluggish real estate market and weak consumer spending continue to weigh on the currency. On the other hand, talk about delaying US tariffs imposed on Chinese exports further complicates matters regarding China's future economic prospects.

The graph arranged in the monthly time frame shows that the Chinese Yuan's weakening started in October and continued until the end of the year when it experienced significant weakening. Renmimbi's weakening occurred more after Trump became the winner in the 2024 US election.

An anonymous source stated that the Chinese Politburo will take a fairly loose approach to its monetary policy in the future, which gives an indication of easing credit and interest rates. This announcement had an impact on global markets and encouraged appreciation of the US Dollar (USD) against the Chinese Renminbi Yuan (CNH).

Today some banks close early which may reduce trading volumes on the forex market such as Japanese and German bank holidays. Bank closures can reduce market liquidity.

Meanwhile, today China will release Manufacturing PMI data which is expected to experience an expansion of 50.3, the same as the previous data. And the Non-Manufacturing PMI which is predicted to be 50.2 is higher than the previous 50.0

USDCNH D1

usdcnh 31 12 2024 d1.png


USDCNH price on the daily timeframe is now moving below the upper band line. Bollinger bands draw an ascending channel with moderate band spacing indicating an uptrend with moderate volatility.

MA 50 below the lower band draws an ascending channel indicating an uptrend. A golden cross signal appears in this time frame where the MA 50 crosses the MA 200 from the downside. The 200 MA below draws a flat channel below the 50 MA indicating a sideways market.

The VB High TDI indicator shows a value of 67 and VB Low shows a value of 56. The difference of 11 reflects the low volatility value in the daily time frame.

Market Base Line shows a value of 62 with a flat channel, meaning the weight of bullish is greater than bearish.

The RSI Price Line is pointing at the value of 61 with the rising channel crossing the TSL from the lower side indicating an uptrend.

Trade Signal Line points to a value of 59 with a flat channel indicating a sideways market.

USDCNH H4

USDCNH price in the H4 timeframe is now moving between the upper and middle band lines. Bollinger bands draw a flat channel with narrow band spacing indicating a sideways low volatility market.

MA 50 below the middle band draws a slight upward channel indicating an uptrend market. The 200 MA is far below the 50 MA, drawing an upward channel that is starting to curve, indicating a fading uptrend.

The VB High TDI indicator shows a value of 60 and VB Low shows a value of 45. The difference of 15 reflects the low volatility value in the H4 timeframe.

Market Base Line shows a value of 53 with a flat channel, meaning the weight of bullish is greater than bearish.

The RSI Price Line shows a value of 56 with a descending channel crossing the TSL from the upper side indicating a downtrend market.

Trade Signal Line points to a value of 57 with an upward channel indicating an uptrend market.
 
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Currency
Rates
EUR / USD
1.04965
USD / JPY
152.324
GBP / USD
1.25970
USD / CHF
0.89894
USD / CAD
1.41795
EUR / JPY
159.887
AUD / USD
0.63508

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