Article by: ETO Markets
According to the most recent Australian foreign trade data released by the Australian Bureau of Statistics, the country's trade surplus increased to 11,437 million MoM in December from 7,500 million projected and 7,129 million in the previous reading. Whereas imports show what is being demanded domestically, export data can provide a significant window into Australia's growth. The trade balance provides a preliminary indicator of the performance of net exports. A stable demand for Australian exports would result in a positive growth in the trade balance, which would be advantageous for the Australian dollar.
Before making directional bets, traders are waiting for clarity on the Federal Reserve's plan for rate cuts, which has kept the precious metal trapped in a trading range that has been in place for many days. The yellow metal is also very close to a multi-week bottom that was struck on Monday. As a result, the market's attention will be fixed on the publication of the most recent US consumer inflation data.
The US Dollar is expected continuing its consolidative price move in a well-known range leading up to the major data risk, notwithstanding the uncertainty around the exact date of the Fed's interest rate reduction. In addition to China's economic problems and geopolitical worries, this maintains a floor on the safe-haven gold price. Nonetheless, in light of the US economy's resilience, investors have been reducing their expectations for a more aggressive policy easing by the Fed. This ought to curb the non-yielding yellow metal and supports higher US Treasury bond yields.
Reaction to remarks made by ECB officials De Guindos and Schnabel, who said that the bank may meet its inflation target in 2025, was nonexistent. They said that a gentle landing in the region's economy was still a possibility. Moreover, even though there have been rumors that the ECB may lower its policy rates four times this year, any talk of interest rate reductions was seen as premature.
The EUR/USD is expected to reject the 200-HMA in the near future despite bullish intraday momentum. It will encounter a technical ceiling at the top of a recent sideways channel that has been forming on intraday charts between … and ...
The EUR/USD appears well-supported on daily candlesticks, despite intraday headwinds. The pair is currently trading slightly north of a bullish crossover of the 50- and 200-DMAs near …; however, a bearish pullback into the … handle will position the pair for a new run into the low bids below … in 2023.
Tokyo's inflation rates were on the decline, according to data released on Tuesday. Additionally, the Labour Ministry's data earlier today revealed that real wages in Japan declined for a 20th consecutive month in November, supporting market speculation that the Bank of Japan will maintain its ultra-dovish stance on policy during its meeting on January 22–23. This should cause the Bank of Japan's goal to move away from negative interest rates to be delayed, along with government stimulus measures following a disastrous earthquake.
The USD/JPY combination is now well-positioned for a potential retest of last week's peak around the … level thanks to the recent slide in the Yen on Wednesday. Momentum in the near-term points to a bullish trend, as the 200-HMA is rising toward …, which corresponds to the low point on Wednesday.
The recent comeback of the USD/JPY from the 200-DMA at … indicates a bullish trend in 2024 price movement, despite the current consolidation between the 50- and 200-DMAs.
