What happened across the Asia session?
Most currencies gained against the DXY during the Asia session with Gold, AUDUSD and USDJPY moving the most.
What does it mean for Europe and US Sessions?
Expect increased liquidity and price volatility as markets begin trading into the new year.
The Dollar Index (DXY)
Key news events today
USD Final Manufacturing PMI
What can we expect from DXY today?
The DXY trades at the 103.30 price level following a brief surge to the upside. As the DXY continues with the current downtrend, look for the DXY to break below the 103-round number support level to signal further downside potential. The next key support level is at 102.60.
Central Bank Notes:
- Federal Reserve hiked rates by 50bps taking interest rates to 4.50%
- Next meeting is on 2 February 2023
- Further rate increases are expected to slow
Next 24 Hours Bias
Weak Bearish
Gold (XAU)
Key news events today
No major news events.
What can we expect from Gold today?
As the DXY continued to trade lower, Gold surged higher, breaking above the previous high of 1820 to climb toward the 1840 price level. With expectations for further weakness in the DXY, look for Gold to continue trading higher toward the next key resistance level of 1850.
Next 24 Hours Bias
Weak Bullish
The Euro (EUR)
Key news events today
No Major News Events
What can we expect from EUR today?
The EURUSD found support at the 1.0655 level as the price failed to break lower. Currently trading at the 1.0680 price level, price action on the EURUSD is signaling the potential for further upside potential. Look for the EURUSD to continue climbing higher, with the next key resistance level at 1.0720.
Central Bank Notes:
- Main Refinancing Rate is currently at 2.50%
- Significant and consistent rate hikes expected from the ECB
- Next meeting on 2 February 2023
Next 24 Hours Bias
Weak Bullish
The Swiss Franc (CHF)
Key news events today
No Major News Events
What can we expect from CHF today?
Despite the volatility in the DXY, the USDCHF continued to trade in a consolidation between the price levels of 0.9230 and 0.9260. If the DXY continues to weaken, look for the USDCHF to break lower, toward the next immediate support level of 0.92.
Central Bank Notes:
- Current policy rate is at 1.00%
- Next meeting on 23 March 2023
Next 24 Hours Bias
Weak Bullish
The Pound (GBP)
Key news events today
GBP Final Manufacturing PMI
What can we expect from GBP today?
The GBPUSD bounced off the 1.2040 price level, climbing higher toward the 1.21 price area. Currently trading at the 1.2080 price level, further upside could be anticipated for the GBPUSD, especially if the DXY continues to weaken. Look for the GBPUSD to break above the 1.21 round number resistance level to signal a stronger breakout toward the next key resistance level of 1.2250.
Central Bank Notes:
- Interest rate is currently at 3.50%
- Peak inflation revised to more than 15% in 2023.
- Next meeting on 2 February 2023
Next 24 Hours Bias
Weak Bullish
The Canadian Dollar (CAD)
Key news events today
CAD Manufacturing PMI
What can we expect from CAD today?
The USDCAD surged strongly to the upside, testing the 1.3620 price area briefly early in the trading session. However, as the DXY weakens, the USDCAD retraced strongly back down toward the 1.3545 price level. Look for the USDCAD to break below the 1.3545 price level to signal a continuation of the downward move, with the next key support level at 1.35.
Central Bank Notes:
- Increased interest rates to 3.75%
- Surprised markets with only 50bps hike in October
- Future hikes determined by future inflation data and expectations
- Next meeting on 25 January 2022
Next 24 Hours Bias
Weak Bullish
Oil
Key news events today
OPEC-JMMC Meeting
What can we expect from Oil today?
Energy prices traded slightly higher as WTI climbed to the 80.50 price level and Brent rose to the 86.00 round number resistance level. Currently, prices are retracing from the recent high. Look for Brent and WTI to complete the current retracement before trading higher again. Look for Brent to retest the 84.50 price level before trading higher again, with the next key resistance level at 90.00. Similarly, WTI could trade lower down to the 79.00 price level before trading higher again toward the 81.50 resistance level.
Next 24 Hours Bias
Weak Bullish
