NZDUSD: the bulls are strengthening the instrument
The New Zealand currency was rapidly strengthening during the Asian trading session, having updated the local maximum on December 19. Currency pair NZDUSD is consolidating at the level of 0.6400 with the prospect of further strengthening, and market participants are rapidly selling off the U.S. dollar amid the published data on the U.S. employment market. According to December statistics new jobs showed an increase of 223.0 thousand, surpassing economists' expectations of 23.0 thousand vacancies, unemployment fell to 3.5% from 3.6%, with an estimate of strengthening to 3.7%. The pay-per-hour rate fell to 4.6% year-over-year from 4.8% previously, with analysts forecasting an uptrend to 5.0%, and the monthly rate dropped to 0.3% from 0.4%. Major market participants expect the U.S. Federal Reserve to correct the dynamics of monetary policy in favor of easing as soon as possible.
- Resistance levels: 0.6400, 0.6450, 0.6500 and 0.6535.
- Support levels: 0.6350, 0.6288, 0.6250 and 0.6200.
USDJPY: dollar began the trading week with a downtrend
The trading instrument USDJPY showed a mixed trend during the morning session, testing the 131.70 mark. The US dollar continues to be under the "bearish" dynamic, having lost ground at the end of the previous trading week, having moved away from the local resistance of December 20.
Meanwhile, analysts expect the Japanese regulator to launch a mechanism of tightening monetary parameters, including an increase in key indicators, taking the interest rate out of the negative zone with the onset of spring this year. The head of the Japanese government, supporting the initiative of the trade union confederation Rengo at a meeting of several national major lobbies to increase employee pay. The official noted that the Japanese economy has a high risk of colliding with stagflation if wages are not indexed to the current rate of inflation. At the same time the authorities plan to allocate up to 1.0 trillion yen for the retraining of workers, moreover, employers will be encouraged to refuse payment of one-time bonuses in favor of an increase in fixed labor compensation.
- Resistance levels: 132.00, 133.00, 133.61, 134.50.
- Support levels: 131.00, 130.00, 129.00, 128.00.
Gold analysis
In Asia-Pacific trading, gold showed moderate gains, having successfully updated the highs of May to 1875.00, developing an uptrend and gaining support amid the release of the US macroeconomic data, which served as the argument for monetary easing by the Fed.
Thus, Friday was marked by the release of the December report on the employment market, which reflected the reduction of the unemployment rate to 3.5% from 3.6%, with the estimates of an increase to 3.7% due to the lower dynamics of the average pay rise, allowing the agency to stick to the plans outlined earlier, providing for the next stage of the key indicator strengthening in the first half of this year, which may be followed by a break. An additional negative factor for the "American" by the end of the previous week was the publication of the business activity data in the service sector from ISM (Institute for Supply Management), which reflected a noticeable reduction for the first time in the last years. Thus, the December value decreased to 49.6 points from 56.5 points with the forecasted decline to 55.0 points, on the other hand, such situation indicates a rapid loss of the inflation potential, allowing the US Federal Reserve System to take a wait-and-see approach.
- Resistance levels: 1879.30, 1900.00, 1915.00, 1930.00.
- Support levels: 1869.49, 1857.27, 1843.37, 1828.22.
Crude Oil analysis
The price of the benchmark Brent crude oil is testing the 79.00 mark.
The growth in quotations occurred due to the cancellation of a number of epidemiological measures by the PRC authorities. Thus, from January 8, it was simplified mandatory testing and centralized isolation for tourists entering China. Experts predict that such an algorithm will stimulate the recovery of production capacity, increasing the demand for energy. Meanwhile, China continues to consult on the possibility of using its national currency when signing contracts on "black gold" with the Persian Gulf countries. The parties may come to an agreement by 2025, according to some experts, will mark the emergence of the "oil yuan" and establish a new energy order. For example, China is currently increasing its imports of hydrocarbons and LNG from Russia, Venezuela and Iran, settling accounts in yuan.
- Resistance levels: 82.40 and 86.90.
- Support levels: 78.00, 75.40.