EUR / USD: AWAITING THE JANUARY FOMC MEETING
THE EUR / USD PAIR HAS BEEN IN A SIDEWAYS TREND FOR SEVEN WEEKS IN A ROW, MOVING ALONG THE HORIZON 1.1300 IN THE 1.1220-1.1385 CHANNEL. Even The Decepttee (Federal Open Market Committee) Meeting Of The Serious Reserve, Which Confirmed The Seriousness of this Central Bank’s Intestanness to Tighten Monetary Policy and Strengthen Dollars. Apparently, The Regulator Is Frightened by The Rate of Inflation In The Country. In addition, IT Did Not Expect The Omicron Coronavirus Strain to Have A Significant Negative Impact On Economic Activity in the United States. To Normalize The Situation, The Fed Decided to Finally Stop The Printing Press and Move on to Raise Interest Rates. The Roadmap for the Near Future Includes Three Main Points: 1) The Curtailment of The Emergency Stimulus Program in March; 2) Three Increases in the Key Rate in 2022, The First of Which May Also Occur in March, After Which 3) The Regulator Will Begin to Normalize The Balance. These Intestanions of the Fed Led to A Sharp Outflow of Funds from Risky Assets. Stock Indices and Cryptocurrency Quotes Collapsed, while US Treasury Yields and The DXy Dollar Index Went Up. Although, IT SHOLD BE NOTED THAT THE STRENGTHENING OF THE THE US CURRENCY WAS INSIGNIFICANT: The Dollar Won Back Only 45 Points Against The Euro, Dropping The EUR / USD PAIR from 1.1345 to the Pivot Point 1.1300. The Release of Data from The US Labor Market On Friday, January 7th Could Be Another Important Event of the Week. The Number of New Jobs Outside The Agricultural Sector (NFP) WAS EXPECTED TO GROW FROM 249K TO 400K. HOWEVER, IT FELL TO 199K INSTEAD. ON THE OTHER HAND, THE UNEMPLOYMENT RATE FELL FROM 4.2% TO 3.9% AGAINST The Forecast of 4.1%. Thus, Investors Did Not Receive Any Clear Signals, And The Pair Completed The Weekly Session Near The Upper Border of the Side Corridor, AT 1.1360. According to Some Experts, The Difference in The Hawkish Attitude of the Ecb SHOLD EVENTUALLY LEAD TO A FURTHER OF THE EUR / USD PAIR TO THE SOUTH. RECALL THAT THE EUROPEAN REGULATOR, ALTHOUGH IT RAISED THE INFLATION FORECAST FOR 2022 AT ITS LAST MEETING IN 2021, STILL CONSIDERS IT A TEMPORARY PHENOMENON, WHICH IS WHY IS NOT WORTH IT YET TO WORRY. It Was Announced OnCe Again That The Refinancing Rate Will Remain At The Current Level Until Inflation Reaches The Target Level of 2.0% and Will Remain There for a Long Time. Eventually, The “Main” Result of the December Meeting Of The Ecb Was The Head Of The Bank Christine Lagarde’s Statement That The Rate Hike In 2022 WAS “Very Unlikely”. Strategists of the Dutch Banking Ing Group (International Nederlanden Groep) Have voted for the StrengthThening of the EUR / USD Pair Will Fall to the 1.1100 Zone in Q2 And Q4 of this year, and it Will Be Even Lower AT 1.1000 in Q4. Analysts of One of the Largest Financial Conglomerates In The World, HSBC (Hongkong and Shanghai Banking Corporation) Are in Solidarity With Ing, Predicting A Downward Trend of this pair as well. CIBC (Canadian Imperial Bank of Commerce) Designated The Following Route for EUR / USD : Q2 – 1.1100, Q3 – 1.1000, Q4 – 1.1000. The Jp Morgan Financial Holding Assessed The Pair’s Prospects More Modestly , Pointing to the Level of 1.1200. HOWEVER, THERE IS AN OPPOSITE OPINION AMONG EXPERTS. FOR EXPAMPLE, BARCLAYS BANK ALREADY CONSIDERS THE DOLLAR TO BE HIGHLY OVERVALUED. Theraefore, IT IS Expected to Depleciate Moderately Against The Backdrop of Rising Risk Appetites and Commodity Prices, Caused By The Recovery Of The Global World Economy and Cooling Inflation. The Barclays Scenario Written for EUR / USD Looks Like This: Q1 – Growth to 1.1600, Q2 – 1.1800, Q3 and Q4 – Movement in the 1.1900 Zone. Morgan Stanley Believes That The Fed’s Rate Hike Will Proceed Fairly Smoothly, While Other Central Banks Will Move from Dovish to Hawkish Politics. This Will Lead To A Convergence in The Actions Of Regulators, Put Pressure On The Dollar and Raise The EUR / USD Pair to 1.1800. The Goldman Sachs Strategists Call The Same GOAL. AS FOR THE NEARTERS, WE CAN EXPECT THAT THE PAIR WILL CONTINUE TO MOVE ALONG THE LEVEL OF 1.1300 UNTIL THE JANUARY FED MEETING, FLUCTUATING IN THE RANGE OF 1.1220-1.1385 WITH THE PREDOMINANCE OF BEARISH SENTIMENT . 70% of Analysts AGREE with this forecast. 15% Have Taken A Neutral Position and Another 15% Side with the Bulls. The Readings of the Indicators on D1 Are Inconsistent As The Multi-Week Sideways Trend. AMONG THE OSCILLATORS, 60% POINT TO THE NORTH, BUT 20% ARE ALREADY SIGNALING THAT THE PAIR IS OVERBOUGHT, 20% POINT SOUTH, AND 20% POINT EAST. Trend Indicators Have 55% Green and 45% Red. The Nearest Resistance Level Is 1.1385, Then 1.1435-1.1465 and 1525. The Nearest Support Level Is AT 1.1275, Followed by 1.1220. This is Followed by The Last November 24 Low of 1.1185 and The Zone 1.1075-1.1100. The Economic Calendar of the Coming Week is Highlighted by The Publication On January 12, 13 And 14 of a Whole Pool of Macro-Statistics from The USA. IT Will Include Consumer Price Indices and Retail Sales Indices, Producer Price Indices, And Retail Sales Volumes in December 2021.
GBP / USD: Boe Hawks VS Fed Hawks
The Fact That, Unlike The Fed and The Ecb, The Bank of England Launched An Attack on Rising Prices in December Made A Strong Impression on the Market. After inflation in the uk rose to 5.1%, Reaching A 10-year PEAK, The Regulator Raised the Rate for the first time in three years 0.2% to 0.25%. The Decision Was Made Despite The Worsening Epidemiological Situation Due To the New Coronavirus Strain. According to the head of the bank of england, Andrew Bailey, The Number One Task Is to Curb Price Pressure On The Economy and Society. Of Course, The Rate Hike by 15 Basis Points Cannot Be Called Significant, Butt, Most Importantly, The First Step Has Already Been Taken, And The Market Experts The Second Rate Hike in February. Such EXpectations Continue to Support The British Currency, and the GBP / USD Pair Updated Its Eight-Week HIGH ON JANUARY 05, REACHING 1.3598. The FINISH OF THE FIVE-DAY PERIOD TOOK PLACE SLIGHTLY LOWER, AT 1.3590. Strategists at the British Investment Barclays Bank Believe That The Pound is Still Very Undervalued, And That The Policy of the US Federal Reserve Will Eventually Lead To A Moderate Depreciation of the Dollar. The NOT EXCLUDE THAT DUE TO THE NEW WAVE OF COVID-19 AND DIFFICULTIES IN RELATIONS WITH THE PAIR MAY DROP TO BREXIT, THE PAIR MAY DROP TO 1.3300 IN Q1. HOWEVER, THEN IT WILL GO UP AGAIN (Q2 – 1.3700, Q3 – 1.4000) And Will Return to the 2021 Highs by The LEVEL OF 1.4200. Capital Economics, One of The Leading Independent Research Centers In The UK, Has Taken The Opposite Position. Its Specialists, On The Contrary, Expect The Pound to Weaken, and Refer to a Combination of 1) Weak Economic Growth, 2) SlowDown in Inflation and 3) Slowness of the Bank of England. These Three Factors, In Ther Opinion, May Lead to The Fact That The UK Regulator Decides to Raise The Rate Only to 0.5% in the COMING MONTHS, INSTEAD OF 1.0%, Which Will Greatly Disappoint The Markets. But, in Addition to the Growth and Fall of the British Currency, There Is a Third Scenario. ING GROUP ANALYSTS PREDICT THAT THE POUND WILL BE SOMEWHERE IN THE MIDDLE OF A TRIANGLE OF A STRONGER US DOLLAR, STABLE COMMODITY CURRENCIES AND WEAKER LOW-YIELDING CURRENCIES. Theraefore, According to their Scenario, The GBP / USD Pair Will Move Sideways Along The Horizon of 1.3400. IF WE TALK ABOUT THE NEAR FUTURE OF THE PAIR, 40% of ANALYSTS VOTE FOR ITS GROWTH ABOVE THE LEVEL OF 1.3600, 50% VOTE FOR A FALL BELOW 1.3400 AND 10% FOR A SIDEWAYS TREND. The Indicators ON D1 Have A Pretty Summery Mood. Among The Oscillators, 100% Is Colored Green, Although 25% Of Them Are Already In the Overbought zone. Among Trend Indicators, 90% of the Are Green and Only 10% Are Red. The Supports Are Located AT 1.3525, 1.3480, 1.3430, 1.3375, The Next Strong Support IS 100 Points Lower. Resistance Levels Are 1.3600, 1.3735, 1.3835. Important Macro-Statistics from the UK Will Be Scarce Next Week. WE CAN Only Note The Data On The Volume of Production In The Manufacturing Industry, Which Will Become Known on Tuesday January 11 and Friday January 14.
USD / JPY: Pair At 5-Year High
The Color of the Indicators for this Pair Is Also Predominantly Green. HOWEVER, UNLIKE GBP / USD, This Does Not Indicate A Weakening Of The Dollar, But, On The CONTRARY, ITS STRENGTHENING. We WE WROTE A WEEK AGO THAT JAPAN NEEDS A WEAK NATIONAL CURRENCY. Thus, The Head of The Bank of Japan, Haruhiko Kuroda, Has Recently Said That A Weak Yen Would Rather Help The Country’s Economy Than Harm It. According to the Senior Official, IF The Yen Falls, It Will Support Exports and Corporate Profits. USD / JPY Chart, His Words Do Not Differ from the Deeds: The Pair Updated Its High On January 04 and Rose to the Point Where It Has Not Been Seen Since January 2017, to the Height of 116.35 . According to Ing Group Experts, The Growth Will Not Stop There, and Weight of 120.00 by The End of the Year. Morgan Stanley Also Prefers The Dollar, Expecting Growth to 118.00. ON CONTRARY, GOLDMAN SACHS Believees That The Pair Will Fall to 111.00 BY 2023. The Pair Finished Last Week AT 115.55. AS ALREADY MENTIONED, DESPITE THE SLIGHT CORRECTION, MOST OF THE INDICATORS ON D1 POINT NORTH. AMONG THE OSCILLATORS THERE ARE 90% OF THOSE (10% Of Them Are Signaling The Pair Being Overbought), The Remaining 10% of the Are Colored Neutral Gray. AMONG TREND INDICATORS, 85% Recommend Buying, 15% – SELLING. Experts Also Agree Side With The Bulls, 0% for the bears, 20% Choose Neutrality. Support Levels Are 115.50, 115.00, 114.25, 113.75, 113.20, 112.55 and 112.70. The Nearest Resistance LEVEL IS 116.35.
Cryptocurrencies: A FULL Crypto Winter? Or Temporary Freezes?
IT IS The Middle of Winter In The Northern Hemisphere of the Planet Earth. And The Weather On The Crypto Market Is CorreSponding, Belle Zero. QUOTES ARE FALLING, AND THERE IS NOT EVEN A HINT OF WARMING SO FAR. ANOTHER COLD WAVE AROSE AFTER THE NEWS APPEARED ON THE NIGHT OF JANUARY 06 THAT THE THE US FEDERAL RESERVE IS READY TO RAISE THE KEY INTEREST RATE EARLIER AND AT A FASTER PACE THAN WAS EXPECTED. This Became Clear from the December Meeting of the Federal Open Market Committee (FOMC). INSPIRED BY THIS NEWS, The Bears Went On The Attack Again. Anti-Government Unrest in Kazakhstanus Added Anxiety to Investors. Recall That A Part of The Miners Immigrated There After The Ban on Mining In China, As A Result of Which Kazakhstan Took The 2nd Place in the world in BTC Production (Top-3: USA – 35.4%, Kazakhstan – 18.1%, Russia – 11.23%). The Internet Was Cut Off Due to the Unrest in Kazakhstan, Which Led to A Significant Decrease in the Hash Rate on The Btc Network. THESE TWO EVENTS CAUSED THE BTC / USD Pair to Break Through Support Around $ 46,000, Where The 200-Day Moving Average Was Passing, and FELL BELOW $ 42,000. Bitcoin’s Crypto Fear & Greed Index FELL TO THE EXTREME FEAR ZONE, HITTING 15 POINTS OUT OF 100, INDICATING PANIC REIGNING IN THE MARKET. The Bitcoin Dominance Index FELL TO 39.65%, HITTING THE MAY 2021 LOWS. (Recall That IT WAS 95.88% AT The Maximum In 2013). Naturally, The Collapsed Bitcoin Pulled The Entire Crypto Market Along With IT. If Its Total Capitalization WAS $ 2.439 Trillion On December 27, IT LOST ALMOST 19% by January 7 and FELL TO $ 1.980 Trillion, Breaking Through An Important Psychological Level of $ 2 Trillion. IT SHOULD BE NOTED THAT THE NEXT MEETING OF THE US FEDERAL RESERVE ON JANUARY 26 WAS PREDICTABLE. Our Weekly Crypto News Review quoted Economist Alex Kruger As Saying That “Investors SHOLD BE EXPECT TO EXITS RISKY ASSETS AHEAD OF THE FED MEETING.” Which IS EXACTLY WHAT HAPPENED. The next Line of Active Defense of the Bulls, According to A Number of Experts, AWAITS BEARS IN THE $ 39,500- $ 41,900 ZONE. IT IS There, Near The Low of Last April 12, IS The Range Of High Liquidity, According to the TradingView publication. IT WAS NOT WAVE OF THE ASSET ‘I Rally Wave of The Price Of Bitcoin Hit An All-Time High. Despite The Fact That The Crypto Market Is Falling for the Eighth Week in A Row, Many Experts and Investors Are Hoping for The Imminent Arrival of The Crypto Spring. For example, block.one Co-Founder, Former Actor and Former US President Candidate Brock Pierce Is Confident That Bitcoin Could Reach $ 200,000 This year. Governments Are Printing Excessive Amounts of Money, Thereby Fueeling Inflation, And This Will Be The Main Reason for Btc to Take Off. “I would not be surprised if bitcoin trades for $ 100,000. It is quite possible that it can jump over $ 200,000 for a moment,” this influencer said optimistically. Antoni Trenchev, co-founder and managing partner of Nexo, a major cryptocurrency Lender (More than $ 6 Billion), Heralds a Stellar Future for the Main Digital Asset. “I Think Bitcoin Will Reach $ 100,000 This year, Perhaps by The Middle of this Year,” He Predicts. THE HEAD OF THE INVESTMENT COMPANY AVA LABS, John Wu, Expressedo Market Will Exceed $ 5 Trillion In 2022. According to Wu’s Forecast, Digital Assets Have the Potential to At Least Double Their Market Value in The Next Year. According to the Head of Ava Labs, Cryptocurrencies That Can Withstand Both The Actions of the Fed and The Record Increase in Inflation, Which Reached Its Maximum Values in The US In Almost 40 Years in Early December 2021. Wu Also Claims That The Share of Bitcoin Will Fall Below 30% WITH OF THE CRYPTO MARKET, ALTHOUGH THE Price May Exceed $ 75,000 per Coin. An Interesting Way to Assess The Prospects of The Flagship Cryptocurrency Was Proposed by Analyst Benjamin Cowen. In His Opinion, Bitcoin HAS ALREADY BOTTOMED OUT, ALTHOUGH ITS DECLINE MAY CONTINUE, SOMEWHERE UP TO $ 40,000. According to Cowen, IT CAN BE MORE REVEALING Sometimes to Value Bitcoin Not in the BTC / USD PAIR, But in Comparison with Other Assets. AS An Example, He Suggests Looking AT BTC PAILED WITH THE S & P500 INDEX. According to the expert, bitcoin has already reached critical support here, as. “It is testing levels that were tested back in September” The experts of Glassnode are in solidarity with Benjamin Cowen, although they use completely different methods of market analysis. According to their estimates, the BTC market indicators paint a fairly positive picture, since an increasing amount of this asset is becoming illiquid. Glassnode examined the dynamics and the supply performance of bitcoin in its report dated January 03, 2022. the results showed that the Growth of Illiquid Asset Supply Accelerated Last Year, Which Now Accounts for 76% of the Total. Glassnode Defines Illiquidity As Moving BTC to a Wallet With No History of Spending. The Liquid Stock of BTC, Which Is 24%, IS IN WALLETS THAT REGULARLY SPEND OR TRADE COINS. The Figures Indicate That More and More Bitcoin Is Being TransferRed to Storage, Which Indicates An Increase In Accumulation. The Reduction in Highly Liquid Supply Also Hints That There Is No Need to Expect a Major Sell-Off or Surrender to the Bears In The Near Future. IT Will Not Be Long to Wait Until The Fed Meeting On January 26. We Will See Then Whether Such Estimates Are Right. In Conclusion, We Just Recall The Words of The Aforementioned Benjamin Cowen. “Anything Is Possible in the Case of Investment,” He Writes. “All Models Can Be Wrong, Although Some Can Be Useful …”
Notice: These Materials Are Not Investment Recommendations or Guidelines for Working In Financial Markets and Are Intended for informational Purposes Only. TRADING IN FINANCIAL MARKETS IS RISKY AND CAN RESULT IN A COMPLETE LOSS OF Deposited Funds.