Forex Analysis – December 28, 2022
Our previous Forex analysis can be viewed here…
Technical Analysis
FOREX ANALYSIS: AUDUSD – Market indecision
As suggested in yesterday’s analysis, the AUDUSD has been moving sideways.
Price continues to be indecisive and lack trend direction. The moving averages are tight and the New Year holidays are approaching, so the market indecision could continue.
Trading opportunities may exist around the moving averages and around any of the horizontal levels at 0.6645, 0.6655, 0.6760, 0.6770, 0.6805, 0.6825 and 0.6845.
FOREX ANALYSIS: EURGBP – Up-trending
The EURGBP has been bullish and has swung higher, as suggested in yesterday’s chart analysis.
Price is clearly up-trending and is currently in a retrace move. The moving averages are bullish and steady, so the upside direction may continue.
Buying opportunities could exist around the dynamic support of the moving averages and around the horizontal levels at 0.8825, 0.8790, 0.8765 and 0.8715.
FOREX ANALYSIS: EURUSD – Ranging
As suggested in our last analysis, price has been moving sideways.
The EURUSD continues to be indecisive. Price is now ranging between 1.0580 and 1.0665. The moving averages are tight and moving sideways and the New Years holidays are approaching, so the market indecision could continue.
Trading opportunities may exist around the support and resistance areas of the range and if EURUSD moves out of the range (break-out trade). A break to the upside could find resistance around 1.0700. A break to the downside could find support around 1.0510.
FOREX ANALYSIS: GBPUSD – Down-trending. Potential range?
Price has been bearish, as suggested in our last Forex analysis.
The GBPUSD is down-trending but is currently struggling to swing lower, so downside momentum may be weakening – the downtrend may becoming to an end. Price may start ranging between 1.2010 and 1.2110. The moving averages are bearish and steady though, so the downtrend may continue.
Selling opportunities could exist around the dynamic resistance of the moving averages and around any of the horizontal levels at 1.2110, 1.2135, 1.2190 and 1.2220. GBPUSD may continue to find support around the recent lows at 1.2010.
FOREX ANALYSIS: USDCAD – Indecisive. Potential downtrend?
USDCAD has been bearish.
Price was indecisive but is now looking bearish. The moving averages suggest that the downside momentum could continue – they are bearish and steady.
Shorting opportunities may exist around the dynamic resistance of the moving averages and around any of the horizontal levels at 1.3530, 1.3570 and 1.3680.
FOREX ANALYSIS: USDCHF – Market indecision
As suggested in our previous analysis, USDCHF reversed around 0.9345 and has been moving sideways.
Price is indecisive. The USDCHF may start ranging between 0.9230 and 0.9345. The moving averages have been crossing frequently and are moving sideways, so the market indecision may continue.
Trading opportunities could exist around the support and resistance areas of the range and if USDCHF moves out of the range (break-out trade). A break to the upside may find resistance around 0.9375 and 0.9430. A break to the downside may find support around 0.9215.
FOREX ANALYSIS: USDJPY – Indecisive
Price has been bullish, as suggested in our previous Forex chart analysis.
The USDJPY was showing signs of a potential downtrend but price is now looking indecisive. The moving averages confirm the potential indecision – they are tight and moving sideways.
Trading opportunities may exist around the moving averages and around any of the identified horizontal levels at 131.05, 131.55, 132.45, 134.70 and 135.80.
METAL ANALYSIS: XAUUSD – Market indecision. Potential uptrend?
As suggested in yesterday’s Forex analysis, price has been moving sideways.
GOLD is indecisive but price action has formed a higher swing high and a bullish channel, so XAUUSD may start up-trending. The moving averages continue to cross and move sideways, signalling market indecision.
Trading opportunities could exist around the moving averages, around the support and resistance areas of the bullish channel and around any of the horizontal levels at 1776, 1786, 1805, 1813, 1822 and 1825.
Fundamental Analysis
Key Analysis
Today’s Major Scheduled News
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Interest Rate Analysis
A summary of recent central bank rate changes and statements…
Australia (AUD)
The Reserve Bank of Australia (RBA) has increased rates again by another 0.25%, so rates are now set at 3.10%. The rate increases throughout 2022 have been to tackle rising inflation. The RBA have said that inflation is still too high, so further hikes are expected.
Canada (CAD)
The Bank of Canada (BOC) has hiked the interest rate by another 50bps, increasing the official bank rate to 3.75% – it’s seventh consecutive rate hike. The BOC noted that they will continue with quantitative easing and that economic growth remains strong, although it expects growth to stall for the first half of 2023.
Euro Area (EUR)
The European Central Bank (ECB) has increased it’s rates by 50bps, so the official rate is now at 2.50%. Europe is potentially entering recession. Projected inflation for 2023 is 6.3%.
Japan (JPY)
The Bank of Japan (BOJ) continues to keep interest rates at the record low of -0.10%. The BOJ does not currently plan to increase rates to tackle high inflation, which has been revised to 2.90% from 2.30%.
Switzerland (CHF)
The Swiss National Bank (SNB) have hiked rates by 50bps, bringing the official rate to 1.0% – it’s third rate hike after more than a decade of negative interest rates. The SNB signalled that rates could move higher, so further rate hikes are expected.
United Kingdom (GBP)
The Bank of England (BOE) have increased it’s official bank rate again. This time by 50 bps, so the official rate is now set to 3.50%. The BOE are expecting recession in the UK and forecast that CPI inflation has now peaked.
United States (USD)
The Federal Reserve has raised the official funds rate by an additional 50bps, so the rate is currently now set at 4.50%. The Fed expect rates to peak at 5.1% in 2023.
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