What happened in the US session?
Most major currencies consolidated along the near-term highs following the strong moves at the end of the previous week. The S&P 500 closed slightly lower by 0.07% at the 3,892 price level.
What does it mean for the Asia Session?
Despite a lack of key news events during the Asia session, look for breakout potentials on the major currencies, with the DXY likely to drive the next directional move.
The Dollar Index (DXY)
Key news events today
No major news events.
What can we expect from DXY today?
The DXY continued its slide lower with the price trading along the 102.70 price level at the end of the trading session. With no major news on the horizon for the US dollar, look for the DXY to consolidate along the current price level before possibly trading lower again. If the DXY breaks below the 102.70 price level, further downside can be expected, with the next key support levels at 102.50 and 102.00.
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?
Following the high volatility move on Friday, Gold traded in a consolidation between the 1868 and 1880 price levels through the trading session yesterday. It is likely that Gold could continue to consolidate at this level in the interim. Look for the development of the price action to indicate further upside potential, especially if the price breaks above the 1880 price level to indicate a continuation of the uptrend, with the next key resistance level at 1900.
Next 24 Hours Bias
Weak Bullish
The Australian Dollar (AUD)
Key news events today
No major news events.
What can we expect from AUD today?
The AUDUSD climbed higher early in the trading session yesterday but the price failed to break above the 0.6950 price level strongly. The AUDUSD consolidated just below the resistance level with choppy price action. Currently trading at the 0.6897 price level, the AUDUSD could reverse strongly down to the 0.68 price level. However, following the strong uptrend, look for the AUDUSD to break above the 0.6930 price level to signal a continuation of the upside, with the next key resistance level at 0.7130.
Central Bank Notes:
- Cash rate stands at 3.10%
- Future rate rises will be determined by data, the outlook for inflation, and the labour market.
- Next meeting on 7 February 2023
Next 24 Hours Bias
Weak Bullish
The Kiwi Dollar (NZD)
Key news events today
No major news events.
What can we expect from NZD today?
The NZDUSD consolidated below the 0.64 round number resistance level overnight, as the price failed to break above the resistance level. With the NZDUSD currently retracing to the downside, look for the retracement to complete to signal a continuation of the uptrend. If the price breaks above the 0.64 price level, the NZDUSD could climb toward the next key resistance level at 0.6480.
Central Bank Notes:
- Cash rate stands at 4.25%
- Central bank is likely to continue with the current path of rate adjustment
- Next meeting is on 21 February 2023
Next 24 Hours Bias
Weak Bullish
The Japanese Yen (JPY)
Key news events today
No major news events.
What can we expect from JPY today?
The USDJPY consolidated between the price range of 131.40 and 132.60 through the trading session yesterday while the slide in the DXY paused at the 102.70 price level. Anticipating a brief retracement in the DXY, look for the USDJPY to retrace and test the 132.50 price level before trading alower again. If the USDJPY breaks strongly below the 131.50 price level, look for further downside with the next key support level at the price area of 130.00.
Central Bank Notes:
- Cash rate stands at -0.1%
- Expands range for 10 year JGB yield fluctuations to 0.5%, rather than the current of 0.25%
- Next meeting is on 18 January 2023
Next 24 Hours Bias
Weak Bullish
