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Germany's economy is forecast to contract by -0.1% in 2024, according to the Ifo Institute. The economy has been "treading water for five years", with growth stalled amid structural challenges.

The institute presents two possible trajectories for 2025: sluggish growth of just 0.4% if structural issues persist, or a recovery to 1.1% if economic policy reforms support industrial revival.

Timo Wollmershäuser, Head of Forecasts at Ifo, stated, “It is not yet clear whether the current phase of stagnation is a temporary weakness or one that is permanent and hence a painful change in the economy.”

He noted that Germany's export sector, once a key driver of growth, has become "increasingly decoupled from global economic development," with competitiveness eroding, particularly in industrial goods outside Europe.

In a pessimistic scenario, this weakness could lead to "creeping deindustrialization," while an optimistic outcome would depend on supportive policies enabling manufacturing to expand production capacities. Such measures could, in turn, boost private consumption and reduce the high savings rate, providing further stimulus to the economy.

Full ifo Economic Forecast Winter 2024 here.

Daily Pivots: (S1) 0.8817; (P) 0.8836; (R1) 0.8860; More…

Outlook in USD/CHF remains unchanged as corrective fall from 0.8956 should have completed at 0.8735 after hitting 55 D EMA. Intraday bias remains on the upside for retesting 0.8956 high first. Firm break there will resume the whole rise from 0.8374. Next target is 61.8% projection of 0.8374 to 0.8956 from 0.8735 at 0.9095. This will remains the favored case as long as 0.8735 support holds, in case of retreat.

In the bigger picture, price actions from 0.8332 (2023 low) are currently seen as a medium term corrective pattern, with rise from 0.8374 as the third leg. Overall outlook will continue to stay bearish as long as 0.9223 resistance holds. Break of 0.8332 low is in favor at a later stage when the consolidation completes.

Daily Pivots: (S1) 1.0471; (P) 1.0505; (R1) 1.0531; More...

Intraday bias in EUR/USD remains neutral and outlook is unchanged. On the downside, break of 1.0471 support will suggest that corrective recovery from 1.0330 has completed at 1.0629, and fall from 1.1213 is ready to resume. Intraday bias will be back on the downside for 1.0330 first, and then 61.8% projection of 1.0936 to 1.0330 from 1.0629 at 1.0254. Also, in this case, sustained trading below 1.0404 key fibonacci level will carry larger bearish implication.

In the bigger picture, focus stays on 50% retracement of 0.9534 (2022 low) to 1.1274 at 1.0404. Strong rebound from this level will keep price actions from 1.1273 (2023 high) as a medium term consolidation pattern only. However, sustained break of 1.0404 will raise the chance that whole up trend from 0.9534 has reversed. That would pave the way to 61.8% retracement at 1.0199 first. Firm break there will target 0.9534 low again.

Daily Pivots: (S1) 1.2715; (P) 1.2749; (R1) 1.2784; More...

No change in GBP/USD's outlook as consolidations continue below 1.2810 temporary top. Rebound from 1.2486 short term bottom could still extend higher. But outlook will stay bearish as long as 55 D EMA (now at 1.2834) holds. On the downside, below 1.2615 minor support will bring retest of 1.2486 first. Firm break there will target 1.2298 cluster support zone. However, sustained break of 55 D EMA will argue that the near term trend has reversed, and targets 1.3047 resistance for confirmation.

In the bigger picture, price actions from 1.3433 medium term are seen as correcting whole up trend from 1.0351 (2022 low). Deeper decline could be seen to 38.2% retracement of 1.0351 to 1.3433 at 1.2256, which is close to 1.2298 structural support. But strong support is expected there to bring rebound to extend the corrective pattern.

Daily Pivots: (S1) 151.37; (P) 152.11; (R1) 153.20; More...

Intraday bias in USD/JPY stays on the upside for retesting 156.74 high. Current development suggests that rise from 139.57 might still be in progress and break of 156.74 will confirm resumption. For now, this will be the favored case as long as 148.64 support holds, in case of retreat.

In the bigger picture, price actions from 161.94 are seen as a corrective pattern to rise from 102.58 (2021 low). The range of medium term consolidation should be set between 38.2% retracement of 102.58 to 161.94 at 139.26 and 161.94. Nevertheless, sustained break of 139.26 would open up deeper medium term decline to 61.8% retracement at 125.25.

Daily Pivots: (S1) 0.6341; (P) 0.6365; (R1) 0.6393; More...

Intraday bias in AUD/USD is turned neutral again with current recovery. Some consolidations would be seen above 0.6336 temporary low. But outlook will stay bearish as long as 55 D EMA (now at 0.6554) holds. Break of 0.6336 will resume the fall from 0.6941 to 0.6269 support next.

In the bigger picture, price actions from 0.6169 (2022 low) are seen as a medium term consolidation to the down trend from 0.8006. More sideway trading could be seen above 0.6169, but overall outlook will stay bearish as long as 0.6941 resistance holds. Firm break of 0.6169 will resume the down trend to 61.8% projection of 0.8006 to 0.6169 from 0.6941 at 0.5806 next.

Daily Pivots: (S1) 1.4121; (P) 1.4158; (R1) 1.4195; More...

Intraday bias in USD/CAD remains neutral for consolidation below 1.4194 temporary top. Outlook will remain bullish as long as 1.4009 support holds. Break of 1.4194 will resume larger up trend to 1.4391 projection level. However, considering bearish divergence condition in 4H MACD, firm break of 1.4009 will indicate short term topping, and turn bias back to the downside for correction to 55 D EMA (now at 1.3925).

In the bigger picture, up trend from 1.2005 (2021) is in progress. Next target is 61.8% projection of 1.2401 to 1.3976 from 1.3418 at 1.4391. Now, medium term outlook will remain bullish as long as 1.3418 support holds, even in case of deep pullback.

Daily Pivots: (S1) 0.9267; (P) 0.9286; (R1) 0.9299; More....

EUR/CHF's strong rally and break of 0.9321 minor resistance suggests that rebound from 0.9204 short term bottom is resuming. Intraday bias is back on the upside. Firm break of 0.9343 will target 100% projection of 0.9204 to 0.9343 from 0.9254 at 0.9393 next. For now, risk will stay on the upside as long as 0.9254 support holds, in case of retreat.

In the bigger picture, outlook will stay bearish as long as 0.9444 resistance holds. Decisive break of 0.9209 low will resume long term down trend to 61.8% projection of 0.9772 to 0.9209 from 0.9444 at 0.9096 next.

Daily Pivots: (S1) 193.03; (P) 193.92; (R1) 195.31; More...

GBP/JPY's break of 55 D EMA mixes up the original bearish outlook. Intraday bias is now mildly on the upside and further rise could be seen towards 199.79 resistance. On the downside, break of 192.35 support will bring deeper fall back to 188.07.

In the bigger picture, price actions from 208.09 are seen as a correction to whole rally from 123.94 (2020 low). The range of consolidation should be set between 38.2% retracement of 123.94 to 208.09 at 175.94 and 208.09. However, decisive break of 175.94 will argue that deeper correction is underway.

Daily Pivots: (S1) 158.88; (P) 159.79; (R1) 160.93; More...

Outlook in EUR/JPY remains unchanged as rise from 156.16 is seen as a corrective recovery. Further decline is expected as long as 55 D EMA (now at 161.76) holds. On the downside, below 157.85 minor support will bring retest of 156.16 first. Break there will target 154.40 low next.

In the bigger picture, price actions from 175.41 are seen as correction to rally from 114.42 (2020 low). The range of consolidation should have been set between 38.2% retracement of 114.42 to 175.41 at 152.11 and 175.41 high. However, decisive break of 152.11 would argue that deeper correction is underway.