EURUSD: the instrument is moving away from the record high
The EURUSD currency pair reflects a moderate loss of positions during morning trading, revealing the potential for a downward correction since the end of the previous week, where the asset has consolidated near its 2022 high.
The American currency is again popular among investors, but the latter agree that the stimulus for the strengthening is mainly technical reasons. Meanwhile, traders predict further softening of the U.S. Federal Reserve rhetoric on the issue of interest rate adjustment. As follows from current estimates, the agency will strengthen the index only by 0.25% at the end of the meeting in early February, and then take a break because of the steady downward trend in inflation. Investors are waiting for the release of the December Industrial Price Index data, which can bring forecasts closer to reality. Experts forecast deceleration of the index to 6.8% from 7.4% on the year and to -0.1% from 0.3% on the month.
- Resistance levels: 1.0800, 1.0850, 1.0900 and 1.0957.
- Support levels: 1.0759, 1.0700, 1.0657, 1.0600.
NZDUSD: the pair updated the local high for December 2022
During the morning trading the NZDUSD trading instrument shows the "bullish" dynamics formed earlier, being in the area of 0.6450 continuing to strengthen, having updated the local maximum for December 15.
Market participants ignored the release of New Zealand's macroeconomic data block on retail sales, which reflected a decline of -2.5% for the month, having previously increased by 0.3% against analysts' estimates of -0.8%, and for the year - to 4.8% from 7.1%, with forecasts of 10.8%. According to REINZ (Real Estate Institute of New Zealand) for December the indexation of housing prices fell again by 2.5%, developing a negative trend from -1.4%.
- Resistance levels: 0.6450, 0.6500, 0.6535, 0.6600.
- Support levels: 0.6400, 0.6350, 0.6288, 0.6250.
GBPUSD: movement within the framework of the unstable upward dynamics
The currency pair GBPUSD is developing a multidirectional trend during the morning trading, being at 1.2280 and the local high of December 15. The asset reflects an unsteady upward trend from January 6 despite the attempt of the American currency to show a moderate strengthening last week.
GBP/USD was positively boosted by the publication of economic statistics on employment in the UK, which showed an increase in unemployment claims for December by 19.7 thousand, moving away from November's value of 30.5 thousand, while unemployment for November remained at 3.7% in the quarterly figure. Market participants also priced in an increase in hourly earnings for November, whose level, excluding bonuses, strengthened to 6.4% from 6.1%, slightly beating analysts' estimates of 6.3%, including bonuses wages up 6.4%, while experts predicted zero dynamics.
Investors are awaiting the release of consumer price growth and retail sales volumes for December. Consumer inflation is expected to reflect a 0.4% monthly increase, continuing November's trend, and show a moderate year-over-year decline to 10.6% from 10.7%, while the retail sales index may reflect a correction to 1.0% from 0.6%.
- Resistance levels: 1.2311, 1.2400, 1.2500, 1.2600.
- Support levels: 1.2240, 1.2150, 1.2084, 1.2000.
Oil market analysis
North American light crude oil WTI is trading on a positive note, testing the 81.10 level.
According to OPEC, the trend of recovery of hydrocarbons may continue due to the increase in production capacity. Preliminary data shows that production in 2022 will increase by 1.9 million barrels per day, while expectations for 2023 assume the value will grow by another 1.5 million barrels per day, reaching 67.2 million barrels. Brazil, the U.S. and Canada will presumably remain the first producer countries, while Norway and Thailand will slightly decrease their numbers.
- Support levels: 78.44, 70.50.
- Resistance levels: 83.28, 92.20.