USDJPY: Dollar recovers losses
The American currency trades with a moderate growth against the Japanese yen, being at 129.70, continuing an upward dynamic. The previous week resulted in the USDJPY pair demonstrating a mixed positive trend against the background of the weak macroeconomic data block, which left the US dollar unable to move away from the record low of May 2022. Meanwhile, market participants expect the Japanese regulator to take a vector of tighter monetary parameters in the coming 2023 as part of its fight against record inflation. However, the last meeting of officials of the agency could not give a clear signal on the further strategy of financial authorities, and experts predict the resignation of the current chairman of the Central Bank in April, after which the situation can be more predictable.
The published data at the end of last week in Japan managed to confirm the trend for further inflation growth. For instance the consumer prices in December had gained 4.0% having risen 3.8% in the previous period against the expected 4.4% while not taking into account the cost of food products and energy resources the correction was 3.0% from 2.8% which was better than the forecasted 2.9%.
- Resistance levels are at 130.00, 131.00, 132.00 and 133.00.
- Support levels: 129.00, 128.00, 127.00, 126.34.
NZDUSD: The New Zealand currency is developing a bullish momentum
During morning trading NZDUSD is showing a mixed trend, testing the level of 0.6470.
The U.S. dollar was affected by the negative factors caused by the macroeconomic data released a week earlier. Thus, the retail sales disappointed the experts, though Friday's index of the number of secondary housing contracts for December reflected a decrease of 1.5%, having sharply decreased by 7.9% the month before at the estimates of -5.4%. Market participants are analyzing the probable correction of the US Federal Reserve's behavior in the issue of tightening monetary parameters, which may be announced at the end of the February meeting. The published earlier statistics on the consumer price index, which updated the minimum level for October 2021, confirmed the stability of the trend to slowdown, developing a decrease after 8.2% for September, 7.7% for October and 7.1% for November at the June maximum of 9.1%, due to which the analysts forecast the next correction step of only 0.25%, which corresponds to the data of the Chicago Mercantile Exchange (CME Group) FedWatch Tool.
- Resistance levels: 0.6500, 0.6535, 0.6600 and 0.6650.
- Support levels: 0.6450, 0.6400, 0.6350 and 0.6288.
Gold analysis
Gold prices reflect moderate strengthening within the framework of consolidation at the level of 1930.00.
The precious metal remains attractive to investors because of the high probability of the next U.S. Federal Reserve's decision to adjust the interest rate by only 0.25%, which may signal an early completion of a systematic tightening of monetary policy. According to preliminary data, in early February the key value strengthening will not exceed the 0.25% step, and then the regulator can take a wait-and-see attitude to assess all the decisions made earlier. The ECB (European Central Bank) as well as the Bank of England may take a similar model of behavior if the situation is identical with the recession of price pressure on the economy of these regions. Meanwhile, the consumer inflation rate continues to remain at a record peak, fueling fears on the part of regulators about the onset of economic recession in the euro area.
- Resistance levels: 1930.00, 1952.53, 1974.22, 2000.00.
- Support levels: 1915.00, 1900.00, 1886.46, 1869.49.
Oil market analysis
The price of benchmark Brent crude oil is testing the 87.00 mark.
Oil is recovering moderately due to fundamental news, according to which the market reacted to the comments of the Saudi Arabian government during a briefing at the WEF (World Economic Forum) in Davos. Based on the official statement, the government is actively considering switching to alternative currencies from the "U.S." to pay for goods in international trade. Such a commentary supported the global sentiment of taking away the role of the U.S. dollar as the dominant global currency, which has been observed in recent times, providing a significant incentive for the hydrocarbon market, giving the potential to form more independent pricing factors for raw materials.
- Resistance levels: 89.30 and 97.70.
- Support levels: 84.80, 76.70.