Sample Category Title

• Nasdaq-100 broke resistance level 16000.00
• Likely to rise to resistance level 16500.00

Nasdaq-100 index recently under the bullish pressure after the price broke above the round resistance level 16000.00, which stopped the weekly uptrend earlier this year, as can be seen below.

The breakout of the resistance level 16000.00 accelerated the active intermediate impulse wave (3) .

Given the strong uptrend from the start of this year, Nasdaq-100 index can be expected to rise further to the next resistance level 16500.00 (which started the weekly downtrend at the end of 2021).

• CHFJPY reversed from support level 162.40
• Likely to rise to resistance level 167.35

CHFJPY recently reversed up sharply from the key support level 162.40, which has been reversing the pair from the start of August.

The upward reversal from the support level 162.40 created the daily Japanese candlesticks reversal pattern Long legged Doji.

Given the strong daily uptrend, CHFJPY currency pair can be expected to rise further to the next resistance level 167.35 (former support from the end of November).

The Euro's recent stabilization against the US dollar, now hovering around 1.0766, may be short-lived. Market eyes are turning towards the upcoming two-day meeting of the US Federal Reserve, starting Tuesday and concluding late Wednesday. Key attention will be on the interest rate decision, widely anticipated to hold steady at 5.50% annually.

Investor focus is keenly set on the Fed's potential moves for February and March, with speculation rife about a possible rate reduction by the end of Q1. Any hints or signals in this regard will be crucial for market dynamics.

Monday's calendar is light, with no major statistics due from either the Eurozone or the US. The real action is expected to start Tuesday.

EUR/USD technical analysis

On the EUR/USD H4 chart, a decline impulse to 1.0804 has been observed. Currently, the market has formed a consolidation range around it. A downward wave to 1.0704 could develop today. This practically implies a breakout from the range downwards, opening the potential for further trend development towards 1.0594. This is the first target. Once the quotes reach it, a correction to 1.0800 might start, followed by a decline to 1.0400. This is a local target. Technically, this scenario is confirmed by the MACD, where its signal line is below zero, pointing strictly downwards.

On the EUR/USD H1 chart, the quotes have rebounded from 1.0805. A structure of a declining wave to 1.0705 is forming. After reaching this level, a correction link to 1.0760 cannot be ruled out (a test from below). Next, a decline to 1.0655 could follow. This is a local target. Technically, this scenario is confirmed by the Stochastic oscillator, with its signal line below 50 and a potential drop to 20.

AUDUSD eases further on Monday and breaks below 200DMA which marks approximately the mid-point of 0.6525/0.6620 congestion, in which the pair is holding for the fifth straight day.

Near-term action lacks clear direction signal while holding within the range, as daily MA’s are in mixed setup and momentum indicator is moving along with the centreline, although, the larger picture is still bullishly aligned.

Range floor also marks significant Fibo support (38.2% retracement of 0.6270/0.6690) and near-term bullish bias is expected to remain in play while the price action stays above this level, however lift and close above range top is required to verify bullish signal and shift focus higher.

Conversely, firm break of 0.6525 pivot would risk deeper pullback.

Investors await release of Australia’s business confidence and US inflation report on Tuesday, as well as Fed’s rate decision on Wednesday.

Res: 0.6574; 0.6601; 0.6619; 0.6656.
Sup: 0.6550; 0.6525; 0.6480; 0.6430.

Bounce from last Thursday’s multi-month low and a bear-trap, extends into second consecutive day and accelerates on Monday.

The dollar benefited from stronger than expected US jobs data in November, which shifted the view about rate cuts in 2024, while BoJ softened the narrative about start of tightening its ultra-loose policy, by comments that there is a little need to end negative rates in December.

Fresh extension higher broke above pivotal Fibo barrier at 145.56 (38.2% of 151.90/141.65), close above which would add to bullish near-term outlook.

Bulls pressure next pivots at 146.70 zone (10DMA/50% retracement) which guards key 148.00 zone (Fibo 61.8%/20DMA/daily cloud base).

Daily studies are improving, as strong downside rejection and bear-trap under 200DMA, underpin the action, though 14-d momentum is still in negative territory and MA’s are predominantly in bearish configuration, keeping in play risk of recovery stall.

Daily close above 145.56 Fibo level (reverted to support) is needed to keep near-term bias with bulls.

Res: 146.70; 147.00; 147.51; 148.00.
Sup: 145.56; 144.80; 144.07; 142.37.

Markets

The Japanese yen last week grabbed a lot of market attention over speeches by the Bank of Japan’s number 1 (governor Ueda) and shared number 2 (deputy governor Himino). Both fanned speculation over an imminent (ie December 19) policy shift, lifting Japanese yields and with it the yen. The currency hijacked the spotlights again today. A scoop by Bloomberg triggers sharp JPY underperformance with USD/JPY bouncing from <145 to 146.35 currently. EUR/JPY recoups much of last week’s losses to trade at 157.48. Compared to the intraday low  (JPY high) seen last Thursday (in the wake of the Himino-Ueda comments), the pairs trade respectively 4.7 and 4.2 yen higher. The financial news agency citing people familiar with the matter reported that the Bank of Japan sees little need to rush policy normalization, which could have included ending the negative rate (-0.1%) experiment later this month. The people said the potential cost of waiting for more information, amongst others evidence of higher wage growth, wasn’t very high and thus worth it. We take note of today’s report but add that it has the BoJ’s modus operandi written all over it. In December last year as well as this summer, the BoJ did exactly the same: downplaying any speculation so that markets expected nothing before coming up with something after all and enjoy the benefit of market moves being exacerbated through liquidity-thinned circumstances. Moves in markets outside Japan are contained and there’s nothing strange about that given the jampacked eco calendar this week. It kicks off with US CPI numbers tomorrow ahead of the Fed on Wednesday. The ECB and Bank of England (and the Norges Bank and Swiss National Bank) meet on Thursday. PMI business confidence indicators for Japan over Europe and the UK to the US are due on Friday. US yields today add a few basis points, building on Friday’s gains and extending a recent recovery. German bunds outperform with the long end easing about 3 bps. The dollar trades flat against the euro and sterling ekes out a gain vs both of them. EUR/GBP is testing support again at the 0.8557 level. This reference was tested multiple times last week and is the last hurdle before EUR/GBP returning to the YtD low of 0.8492.

News & Views

November Norway CPI today provided the final input for the Norges Bank’s (NB) final policy decision this year on Thursday. Inflation was very volatile over the previous months with a substantial downside surprise in September and a big upside surprise in October. November came in slightly lower than consensus. Headline inflation rose 0.5% M/M and 4.8% Y/Y (was 1.0% and 4.0% in October). Core inflation decreased 0.2% M/M bringing the Y/Y-measure to 5.8% (from 6.0%). The rise in headline inflation was mainly driven by a 3.4% M/M rise in prices for housing, water, electricity gas and other fuels. Clothing and footwear rose 2.8% M/M. Furnishings, household equipment, and routine maintenance (-1.7%), recreation and culture (-0.9% M/M) and communications (-0.4% M/M) slowed inflation. Both headline and core inflation were below the NB September forecast of respectively 5.4% and 6.1%. The NB back then kept an additional interest rate hike on the table (4.25% currently), depending on the data. The weak krone was a concern at time of the November meeting. Since then, the NOK rebound was limited given the overall easing of monetary conditions due to lower LT yields in the US and EMU. The krone today weakened from EUR/NOK 11.75 to currently 11.795.

Inflation in the Czech Republic in November rose 0.1% M/M easing the Y/Y-measure to 7.3% Y/Y down from 8.5%. Prices of electricity were .6% M/M higher and natural gas 0.7%. Clothing and footwear rose (1.0%). Prices for transport and health dropped 1.1% and 1.4% M/M. Goods prices remained unchanged M/M while services still increased 0.2% M/M. The Czech national bank in its autumn report forecasted November CPI slightly slower at 7.1%. According to the CNB this was due to a less pronounced slowdown in the Y/Y growth in administered prices. By contrast, core inflation slowed slightly more markedly than forecasted (3.9% vs 4.0% expected). Annual food price inflation also slowed significantly further (-0.4% M/M and 1.7% Y/Y down from 3.5%). The CNB concludes that the strength and broad nature of the disinflationary trend is illustrated by low month-on-month price growth in recent months. The CNB sees inflation averaging 2.7% in Q1 2024. The market still isn’t sure whether today’s numbers will be enough for the CNB to start its cutting cycle in December. CZK today trades marginally stronger at EUR/CZK 24.36.

Daily Pivots: (S1) 1.0722; (P) 1.0762; (R1) 1.0799; More...

Further decline remains in favor in EUR/USD despite loss of downside momentum. Sustained trading below 55 D EMA (now at 1.0770) will extend the fall from 1.1016 short term top to retest 1.0447 support. However, on the upside, above 1.0816 minor resistance will turn intraday bias back to the upside for stronger rebound.

In the bigger picture, price actions from 1.1274 are viewed as a corrective pattern to rise from 0.9534 (2022 low). Rise from 1.0447 is seen as the second leg. While further rally could cannot be ruled out, upside should be limited by 1.1274 to bring the third leg of the pattern. Meanwhile, sustained break of 55 D EMA will argue that the third leg has already started for 1.0447 and below.

Daily Pivots: (S1) 1.2500; (P) 1.2551; (R1) 1.2600; More...

Further decline remains mildly in favor in GBP/USD despite today's recovery. Fall fall 1.2731 short term top would extend to 55 D EMA (now at 1.2445). Sustained break there will bring retest of 1.2036 low. However, firm break of 1.2611 will turn bias back to the upside for retesting 1.2731 resistance.

In the bigger picture, price actions from 1.3141 medium term top are seen as a corrective pattern to rise from 1.0351 (2022 low). Rise from 1.2036 is seen as the second leg, that could still extend through 1.2731. But upside should be limited by 1.3141 o bring the third leg of the pattern. Meanwhile, sustained trading below 55 EMA will argue that the third leg has already started for 38.2% retracement of 1.0351 (2022 low) to 1.3141 at 1.2075 again, and possibly below.

Daily Pivots: (S1) 0.8754; (P) 0.8788; (R1) 0.8834; More....

USD/CHF's rebound from 0.8665 short term bottom is still in progress. Intraday bias stays on the upside for 0.8886 support turned resistance first. Decisive break there will indicate that whole fall from 0.9243 has completed, and bring stronger rally to 0.9111 resistance next. On the downside, below 0.8727 minor support will turn intraday bias neutral first.

In the bigger picture, price actions from 0.8551 are currently seen as part of a corrective pattern to the decline from 1.0146 (2022 high). Fall from 0.9243 is seen as the second leg for now. Deeper decline could be seen to 0.8551 low but strong support should be seen there to bring rebound. Meanwhile, break of 0.9111 resistance will argue that the third leg has started already, and target 0.9243 and above.