USDCHF: the pair is in a corrective mood
After the termination of the "bears" domination last week, where USD/CHF pair updated the local minimum of April 12, in the morning trading there is an active attempt to strengthen.
Investors are giving advantage of profit taking on short positions before the fast-approaching summit of the U.S. Federal Reserve System, scheduled for Tuesday, December 13. Market participants are confident of a 0.50% rise in the key index due to the gradual reduction of consumer price pressures. Meanwhile, the Fed is expected to release updated economic forecasts, and Fed Chair Jerome Powell may attempt to reassure markets by reiterating previous guidance for the U.S. economy. Before that, analysts will focus on November consumer price statistics, which will be released tomorrow. The preliminary estimate sees the monthly figure accelerating to 0.5% from 0.4% while the annual figure is expected to show zero growth of 7.7%.
- Resistance levels: 0.9400, 0.9478, 0.9550, 0.9600.
- Support levels: 0.9350, 0.9300, 0.9250, 0.9200.
USDJPY: dollar is making up for last week's losses
The American currency shows positive momentum, being at 137.00 with an upside prospect, while the "bulls" are waiting for more stimulus to strengthen the trend.
A moderate support to the Japanese yen is provided by the positive macroeconomic data block on production prices. Thus, according to the November results the index of industrial inflation strengthened by 0.6%, having earlier strengthened by 0.8% for the previous month, while analysts expected the decline to 0.5%. Domestic corporate commodity prices showed a slight correction to 9.3% from 9.4% with the market expecting 8.9%. Meanwhile, large manufacturing sector activity for Q4 decreased by 3.6%, having previously strengthened by 1.7%, with a minimum of 0.1% growth expected. Economists noted the high potential momentum of economic recovery in Japan for the current quarter due to the removal of part of the sanctions on semiconductors for the auto industry and the lifting of control measures due to Covid-19, allowing to increase tourism capacity, both international and domestic. This will lead to support for private consumption, spurring an October-December economic recovery.
- Resistance levels: 137.50, 138.50, 139.58, 140.79.
- Support levels: 136.50, 135.57, 134.78, 133.61.
The precious metal is showing a strong decline, having retreated from the local high of December 5, updated last Friday. The stock trades at 1785.00, continuing a decline ahead of the release of inflation data for November, announced ahead of a two-day U.S. Federal Reserve meeting. The current estimate calls for inflation at 7.7%, but the core could rise to 6.4% from 6.3%. Investors are predicting a 0.50% hike in the interest rate by the agency, but of greater importance is the updated forecast by officials for the medium term.
At the same time, the Swiss National Bank, ECB (European Central Bank) and the Bank of England are scheduled to meet this week. Preliminary estimates suggest a continuation of moderate interest rate hikes, despite the high probability of a recession for the EU and United Kingdom economies.
- Resistance levels: 1800.00, 1816.62, 1828.22, 1843.37.
- Support levels: 1786.28, 1765.66, 1753.09, 1734.91.
Cryptocurrency Market Analysis
Last week showed a decline of the first cryptocurrency BTC to the level of 16700.00, but later some positions were recovered at the level of 17200.00, where the trading continues in the last sessions.
The cryptocurrency market continues to be affected by contradictory factors, firstly, the negative mood is due to the bankruptcy of a major trading platform FTX, and secondly, from a significant collapse in the prices of electronic assets retain monetary reasons. The process of liquidation over the last six months has dealt a strong blow to the reputation of the sector which deprived assets of a considerable part of investments. As follows from a survey of the U.S. population, initiated by CNBC channel, by the end of this year, the level of confidence among surveyed citizens to invest in digital assets fell from 19.0% to 8.0%, the number of respondents with a strongly negative opinion about crypto-assets after the bankruptcy of FTX and Terraform has increased from 25.0% to 43.0%. The exit of the FTX exchange from the market has not escaped the attention of the authorities, which will make it more likely to establish regulatory bodies over the activities of such a segment of investment, reducing the interest of potential newcomers. At the moment, a number of government regulators are conducting audits on unfair practices in the PR-companies exchanges, and the SEC (U.S. Securities and Exchange Commission) made a requirement for the national business to transmit data on the ownership of digital assets, in addition to disclose information on trading transactions in the cryptocurrency market.
- Resistance levels: 17830.00, 19100.00, 20000.00.
- Support levels: 16800.00, 15700.00, 15000.00, 13750.00.