The US dollar has come to a halt due to consolidation ahead of the FOMC Minutes tomorrow. The pair is now 1.0636 and as it appears, it will continue to trade in the range of 1.0670 - 1.0550.
Gold is seeing its worst days since the beginning of the year. The precious metal has found support in February levels around $1,160. Price is now $1,160.57 and it seems that the metal will now consolidate ahead of one of the most important events of the year - the last FOMC meeting for 2016 which will determine whether the interest rate will raise.
Market participants are sure that the FED Chair Janet Yellen will raise rates and they acted on this belief by supporting the US dollar in its latest rally against all competitors. This means that if we really get a raise, as everyone expects, the move down might not even happen as it did with the last interest rate raise - the US dollar did not do anything when the news came out.
The best thing you can do, as advised by all experts, is to not trade the news. This is important in such times as these where the uncertainty globally and locally in the US is the main environment for the market.
Analysts and experts predicted before the last raise that a Yes vote will put an end to all bullish hopes for Gold, but 2016 proved that the opposite actually happened.
EUR/USD Awaits Key Meeting
Market participants are now anticipating the latest FOMC Meeting that will decide if the rates go up. It’s considered by some that this is a “done deal” and the interest rate will hike with 0.25 basis points. EUR/USD already is rallying as well as US equities. Yesterday the Dow posted a record breaker when it reached 19,956.
With Dow closing in on 20,000 and the US dollar approaching parity with the Euro many experts now say that the FED does not actually have a choice and it’s mandatory to raise rates.
The result will be publicly announced at 2pm eastern time as market players are currently on hold with their trading waiting on the decision.
EUR/USD posted minor gains yesterday as it reached 1.0660 and is now trading at 1.0649. It is expected that price will continue trading in the same range until the news release.
Have in mind that volatility may be high and any exposure to markets poses a risk to your capital. Play it safe today and don’t act based on emotions.
USD/JPY appears to be on hold at the moment as price has approached key level at 116.00. The pair might consolidate until the FED releases its decision to raise or not to raise the interest rate. CMP 115.13.
FED raised rates for the second time in a decade in yesterday’s FOMC meeting. FED Chair Janet Yellen announced that the interest rate goes up with 0.25 basis points. The equity market didn’t like the news and fell, while the EUR/USD went below 1.05. First support zone is seen at 1.0450.
Gold went from $1,165 to a low of $1,136, currently trading at its lowest point. The precious metal felt the bear pressure when the FED announced to raise rates with 0.25 basis points.
Silver is also on the losing side, down from 17.20 to 16.53.
EUR/USD reached a multi year low yesterday going to 1.0366. The pair broke the support level at 1.04 and stayed for a while before the bullish camp took the chance to buy the dip. EUR/USD is now trading at 1.0444.
Gold Sells Off as Dollar Surges
As we head into years end markets become more and more uncertain due to increased volatility and unexpected price changes. The interest rate yesterday acted as a catalyst to a new wave of dollar rally and that resulted in a sell off in the Gold market.
The precious metal went from $1,165 to $1,138 on the day of the raise and continued to depreciate the next day going as low as $1,122. Currently, Gold is slightly recovered and is trading around $1,133. This, however, might only be a reflex from the sharp sell off and price still has a good chance to continue South to a probable first target level at $1,100.
It wouldn’t be surprising if bears try to reach that psychological $1,100 before the year ends as this looks a realistic goal for we have seen what Gold did in the second half of the year.
In January this year Gold was at a low at $1,046, then went up almost 40% to a high of $1,375. Now Gold has lost almost every gain made throughout the year leaving all Gold bugs devastated.
The economic outlook for the US economy is very optimistic and that might reflect on the price of Gold in the near future and Gold bulls might not like it.
EUR/USD is trading somehow lower in the early opening hours of the week. The pair is now 1.0459 up from 1.0366. Main trend remains bearish as the pair broke the support level at 1.04. The break suggest that a move down is likely which hints to a probable parity in 2017.
USD/CAD is trading lower in the first hours of the opening session today as market participants are cautious and careful in the week before Christmas. US dollar bulls are withdrawing a bit as the US currency is seen to decline against its competitors.
USD/CAD traded at 1.3418 last week and went slightly below 1.34, currently 1.3383. Main trend on the short-term remains bullish but on the long-term we can observe how narrow of a path the pair has chosen to go. Since May USD/CAD has been trading in the range between 1.27 and 1.34. Last week the USD made a low of 1.3080 against the CAD and that acted as a support, moreover the pair got assisted by the 200SMA.
What follows next might very well be a consolidation until years end as we have no major news or events that can inject new volatility. Traders and investors might take this time to get off the markets and spend time with their families in the warmest holiday of the year.
AUD/NZD Consolidation Continues
It has been a rough year for both the Australian and the New Zealand dollar. The pair made a low in September at 1.0230 which acted as a support zone, confirming the prior support levels at 1.0022 and 1.0042. After that recent low the Australian dollar started to appreciate against its counterpart going as high as 1.0763.
That level, however, was met with disapproval from the bear camp and they used the resistance created by the 200SMA to bring the price down to lower levels. Since then, the pair has been in consolidation forming a coil with very volatile and uncertain moves to both sides.
Currently, the pair is trading at 1.04640 and, as it appears, it might try to revisit the support level this time slightly below 1.0300. If we see a dip below that line, bears can take control over it and bring it even further below 1.0100.
On the other hand, if we can break above the 200SMA then bulls will have the upper hand.
EUR/USD is trading with little to no change in today’s opening hours. The pair is now 1.0404, down from today’s high of 1.0479. If we break below 1.04 again then bears might have the upper hand and we could see parity in the near future. First support is seen at last low at 1.0366.
USD/CHF Double Top
In the week before Christmas despite all the prior volatility and uncertainty in markets there is still some good old pattern following movements. Markets are now calmer and contained as we head into 2017. USD/CHF made a high 1.0340 on 15 Dec and since then it’s been trading around the 1.0300 level. That level is seen as a second top which comes less than a month after the first top made on 27 Nov.
USD/CHF is now trading at 1.0277 indicating that the resistance zone is acting strongly and preventing bulls from going above 1.0350. If that level holds we might see a move to the downside to a probable first target of 1.0000, or in other words - parity.
On the other hand, given how strong the US economy is right now and how optimistic the outlook is, bulls can very easily take out the resistance and go well above 1.0350.
No matter which one it might be, market participants usually are very quite in the last week of the year so low volatility can be expected.
EUR/USD is now trading slightly above 1.0405, better than yesterday’s levels below the psychological 1.04 level. The pair seems more confident to try and make move to the upside before the weekend. However, bears have the upper hand and if they manage to bring it back below 1.04 for the day this might act as a catalyst for future depreciation in the near-term.
USD/JPY’s latest and awesome rally appears to have come to a hold as price lost steam once it reached just slightly below 119.00. The pair reacted dovishly when it went as high as 118.65 and has been consolidating around that level eversince.
Main trend on the long-term remains strongly bullish, but the effect by the Trump wave seems to have worn off and now if USD bulls want to continue their marching North they would need something strong othwerise bears have the advantage caused by low liquidity and weak bull support.
Expectations are that USD/JPY will continue trading in the range between 116-something to 118 until years end as market participants are away to spend time with families taking the volatility with them.
However, we still have some important news such as Consumer Confidence and Advance Retail Sales scheduled for next week that may cause unexpected rapid moves to either side.
EUR/USD is trading barely unchanged from yesterday’s levels still gravitating towards the 1.04 level. Price is now a bit higher at 1.0445 and it seems that a correction is at hand as we approach years end. Important news are scheduled for later today that may alter current pace and direction.
Nothing out of the ordinary in today’s session as traders and investors are having a few days in a calmer market environment before Christmas. EUR/USD is now trading at 1.0459, slightly up from yesterday’s levels.
Gold is trading unchanged from yesterday’s levels still gravitating towards the $1,130 level. The precious metal is still in bearish territory and consolidating ahead of Christmas and New Years’ eve. Support rests at $1,120, resistance awaits at $1,140.
EUR/USD is trading a bit higher in today’s session going as high as 1.0467. The pair is seen to consolidate towards current levels as bulls might be into correction before the price heads to parity, as analysts and experts predict for early 2017.
Gold is seen to consolidate around $1,130 with current market price of $1,132. The precious metal has had its worst six months in years with price going from a high of $1,375 to a low below $1,130 leaving all Metal Hedge Funds and Metal investors devastated. However, those same participants might use the time to buy the dip and hold for a historical rally, should we see the Trump administration not meet expectations.