Forex Analysis – January 11, 2023

Our previous Forex analysis can be viewed here…

Technical Analysis

FOREX ANALYSIS: AUDUSD – Up-trending

As suggested in our last Forex chart analysis, price has been bullish and has swung higher.

AUDUSD was indecisive but is now clearly up-trending. Price is currently in a retrace move. The moving averages are bullish and widening and price action has formed a bullish channel, so the uptrend may continue.

Opportunities to go long could exist around the longer-term moving average, around the bullish channel support area and around the horizontal levels at 0.6880, 0.6835, 0.6780 and 0.6730. A bullish move may stall or reverse around the shorter-term moving average and around the recent swing high at 0.6945.

FOREX ANALYSIS: EURGBP – Indecisive. Possible downside?

Price continues to be indecisive, as suggested in our last analysis.

EURGBP is indecisive but has formed a bearish channel, so price action could become bearish. The moving averages continue to signal market indecision though – they are moving sideways and have been crossing frequently.

Trading opportunities may exist around the moving averages, around the support and resistance areas of the bearish channel and around any of the horizontal levels at 0.8765, 0.8775, 0.8800, 0.8865 and 0.8870.

FOREX ANALYSIS: EURUSD – Potential uptrend?

EURUSD has been bullish.

Price was indecisive but is now looking bullish. Price action has formed a large bullish move and swing higher, so the upside momentum may continue. The moving averages confirm this – they are bullish and widening.

Long opportunities could exist around the dynamic support of the moving averages, around any of the key Fib levels and around any of the horizontal levels at 1.0710, 1.0680, 1.0640, 1.0630 and 1.0580.

FOREX ANALYSIS: GBPUSD – Possible uptrend?

As suggested in our previous Forex analysis, GBPUSD has been bullish and has swung higher.

Price was indecisive but is now looking bullish. Price action is currently forming a retrace move. The moving averages bullish and widening, so the upside direction could continue.

Buying opportunities may exist around the bullish moving averages, around any of the key Fib levels, around the previous diagonal resistance area (as support) and around the horizontal levels at 1.2135, 1.2110, 1.2080 and 1.2005. A bullish move could stall or reverse around the horizontal resistance levels at 1.2190 and 1.2205.

FOREX ANALYSIS: USDCAD – Down-trending

Price has been bearish, as suggested in our previous analysis.

The USDCAD is down-trending and is currently in a retrace move. The moving averages are bearish and widening, so the downtrend may continue.

Opportunities to go short could exist around the longer-term moving average, around any of the key Fib levels and around the horizontal levels at 1.3475, 1.3495, 1.3525 and 1.3575. A bearish move may find support around the shorter-term moving average and around the recent swing low at 1.3365.

FOREX ANALYSIS: USDCHF – Market indecision. Potential downside?

As suggested in our last analysis, price has been bearish.

The USDCHF is looking indecisive but has formed a swing lower, signalling a potential downtrend. The moving averages confirm the possible downside – they are bearish and widening.

Shorting opportunities may exist around the dynamic resistance of the moving averages, around any of the key Fib levels, around the previous diagonal support area (as resistance) and around the horizontal levels at 0.9265 and 0.9345. A bearish move could be rejected or reverse around the horizontal support levels at 0.9215 and 0.9180.

FOREX ANALYSIS: USDJPY – Indecisive. Potential range?

The USDJPY has been moving sideways, as suggested in our last chart analysis.

Price is indecisive and is lacking trend direction. The moving averages are tight and moving sideways, so the market indecision may continue. USDJPY may start ranging between 131.30 and 132.70.

Trading opportunities could exist around the support and resistance areas of the range and if price moves out of the range (break-out trade). A break to the upside may find resistance around 134.50 and 134.70. A break to the downside may find support around 130.20 and 129.60.

METAL ANALYSIS: XAUUSD – Clear uptrend

As suggested in our previous analysis, GOLD has been bullish.

Price is clearly up-trending. Price action is currently in a sideways retrace move at 1869-1879. The moving averages are bullish and widening, so the uptrend could continue.

Opportunities to go long may exist around the dynamic support of the moving averages, around the trend support area and around the horizontal levels at 1870, 1861, 1847, 1833 and 1827. A bullish move could find resistance around the recent highs and range resistance area at 1879.

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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