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A mixed start to trade in Europe after a more promising session in Asia overnight where stocks may have been boosted by talk of more pro-growth policies in China.

That followed disappointing data late last week and early this from the world's second-largest economy so the comments came at a good time. Still, we're not seeing investors getting too carried away by comments alone, action needs to follow and small rate cuts from the PBOC don't really fall into that category.

More misery for the UK as prices rise by the most since the early 80s

UK inflation hit its highest level in 40 years last month, with the annual CPI jumping 10.1% and the core reading 6.2%, both faster than expected. Double-digit inflation was inevitable but it has come earlier than expected which will leave households and businesses worrying about what that ultimately means for peak inflation later this year and how sustained it will be.

The data today has probably locked in a 50 basis point hike from the Bank of England as a minimum, especially when combined with yesterday's wage growth numbers. Real incomes are still falling at a rapid rate but the central bank will have little choice but to persevere regardless and the economy will suffer the consequences.

RBNZ committed to tackling price rises as it raises the cash rate peak

The New Zealand dollar is trading a little lower on the day but the session has been quite volatile. We've seen some big swings in response to the RBNZ announcement despite the rate decision itself falling in line with expectations. The central bank now expects the cash rate to peak higher and earlier than previously anticipated, hitting 4.1% in the second quarter of next year, compared with 3.95% in Q3.

The RBNZ still firmly believes though that the actions it's taken will both return inflation to the midpoint of its 1-3% target range in 2024 and not trigger a recession, although it did caution that the country will likely experience sub-par growth. That all sounds very hopeful but BoE aside, that appears to be the view of central banks still.

Fed minutes eyed as traders seek dovish pivot clues

There's plenty more to look forward to today but the FOMC minutes naturally stand out. What's interesting about them is that despite the supposed "dovish pivot" from the Fed, the commentary since has been anything but. Rather than talking up the prospect of falling inflation allowing for slower tightening, the message remains hawkish. What's more, policymakers are continually pushing back against the policy u-turn next year that markets have been flirting with the idea of.

I expect any hawkish components of the minutes will be overlooked today and instead traders will dissect them for any additional dovish concessions that could further fuel the stock market recovery. That's very much what we've seen in recent weeks and the decline in CPI last week only encouraged it.

Oil rebounds off support as JCPOA talks continue

Oil prices are edging higher on Wednesday, bouncing off technical support over the last 24 hours as Chinese Premier Li pushed for more pro-growth measures from local officials. There are growing downside risks as a result of the growth outlook and ongoing uncertainty around Chinese Covid restrictions.

What's more, talks between the US and Iran are continuing around the nuclear deal which, if it gets over the line, could be a big positive for oil supply and therefore a negative for prices. There is no shortage of scepticism around the prospects for the JCPOA to be revived though but we may be reaching a point where that will become clear. For now, Brent appears to have decent support around $92.

Gold flat after a pullback

Gold is marginally lower on the day with focus fully on the Fed minutes later in the day. The yellow metal has been knocked back in recent days after briefly breaking through $1,800 resistance. It's remained quite resilient though against the backdrop of a strengthening dollar and the FOMC minutes later could potentially reward that.

Could Fed minutes be the catalyst bitcoin needs?

Bitcoin rallies have struggled to generate much momentum of late, with $25,000 proving to be a strong barrier to the upside. What's interesting is how shallow the pullback has so far been from that level which could be a bullish signal. Traders may be struggling to get on board with a break higher but they're perhaps not keen to cash out either. The FOMC minutes later may be the catalyst it needs, one way or another.

Daily Pivots: (S1) 160.77; (P) 161.75; (R1) 163.41; More...

Overall, GBP/JPY is still extending the corrective pattern from 168.67. Intraday bias is back on the upside with break of 162.77 minor resistance. Further rise is in favor to 163.91 first. Break there will target 166.31 resistance next. On the downside, below 160.07 will turn bias to the downside for 159.42 and below.

In the bigger picture, up trend from 123.94 (2020 low) is still in progress. Sustained break of 61.8% retracement of 195.86 (2015 high) to 122.75 (2016 low) at 167.93 will be a long term bullish signal, and could pave the way back to 195.86 high. This will remain the favored case as long as 155.57 support holds, even in case of deep pull back.

Daily Pivots: (S1) 135.34; (P) 136.13; (R1) 137.31; More....

Intraday bias in EUR/JPY stays neutral at this point. Overall, it's staying in the corrective pattern from 144.26. On the upside, above 138.38 will resume the rebound from 138.38. On the downside, below 134.93 will turn bias back to the downside for 133.38 support.

In the bigger picture, up trend from 114.42 (2020 low) is seen as the third leg of the pattern from 109.30 (2016 low). Further rally is in favor as long as 134.11 resistance turned support holds, even in case of deep pull back. Next target is 149.76 (2015 high). However, sustained break of 134.11 will be a sign of medium term bearish reversal and turn focus to 124.37 support for confirmation.

Daily Pivots: (S1) 0.8394; (P) 0.8417; (R1) 0.8429; More...

EUR/GBP's rebound from 0.8338 could have completed at 0.8491 already. Intraday bias is mildly on the downside for 0.8338 support first. Decisive break there will resume the fall from 0.8720 to retest 0.8201 low. On the upside, above 0.8439 minor resistance will turn intraday bias neutral first. But risk will stay on the downside as long as 0.8491 resistance holds.

In the bigger picture, current development suggests rejection by 38.2% retracement of 0.9499 to 0.8201 at 0.8697. Medium term bearishness is maintained. Break of 0.8201 will resume larger down trend from 0.9499 (2020 high). Nevertheless, sustained break of 0.8697 will affirm the case that rise from 0.8201 is a medium term up trend itself.

Daily Pivots: (S1) 1.4429; (P) 1.4481; (R1) 1.4527; More...

EUR/AUD continues to lose downside momentum. But further fall is still expected with 1.4804 resistance intact, to retest 1.4318 low. Firm break there will resume larger down trend to medium term projection level at 1.3623. On the upside, break of 1.4804 resistance is needed to indicate short term bottoming. Otherwise, risk will stay on the downside in case of recovery.

In the bigger picture, down trend from 1.9799 is still in progress. Break of 1.4318 low will target 61.8% projection of 1.9799 to 1.5250 from 1.6434 at 1.3623, which is close to 1.3624 long term support (2017 low). This will remain the favored case now as long as 1.5396 resistance holds.

Daily Pivots: (S1) 0.9615; (P) 0.9647; (R1) 0.9690; More....

A temporary low is formed at 0.9602 and intraday bias in EUR/CHF is turned neutral first. Upside should be limited well below 0.9948 resistance to bring another fall. Break of 0.9602 will resume larger down trend to 100% projection of 1.1149 to 0.9970 from 1.0513 at 0.9334.

In the bigger picture, long term down trend from 1.2004 (2018 high) is still in progress. Next target is 138.2% projection of 1.2004 to 1.0505 to 1.1149 at 0.9033. On the upside, break of 0.9970 support turned resistance is needed to be the first sign of medium term bottoming. Otherwise, outlook will stay bearish in case of strong rebound.

EUR/USD

During yesterday's trading session, the single European currency managed to register some growth and to overcome the nearest resistance at 1.0158. At the time of writing, neither the bears nor the bulls are able to prevail and move away from the level at 1.0158. This is likely to remain the case until 12:30 GMT, when the retail price index and the business investment index data will be released. Another major news that could cause high volatility is that of crude oil stocks at 14:30 GMT. If the news is positive for the bulls, then they could make an attempt to reach the next resistance at 1.0276.

USD/JPY

During yesterday's trading session for the Ninja, the bulls managed to consolidate the resistance breach at 133.29 and to reach and test the next one at 134.33. Their breach is still not confirmed, and at the time of writing, the levels are moving around the mentioned resistance. If investors maintain their momentum, then the next resistance for them would be the level at 135.38.

GBP/USD

The sterling’s situation is similar to that of the USD/JPY, with the bulls managing to gain the upper hand. During yesterday's trading session, they managed to breach the resistance at 1.2063, but made an unsuccessful attempt to breach the next one at 1.2134. From the end of yesterday's session right up until now, we have been observing the so-called "sideways movement". If, however, the bulls manage to overcome the resistance at 1.2134, then they would have to face the next one at 1.2183 as well. On the other hand, if the bears manage to recover yesterday's losses, then they could test the support at 1.2020.

EUGERMANY40

The bullish trend seems to have prevailed in the German index as well. During yesterday's trading session, investors managed to consolidate the resistance breach at 13.884. The next psychological resistance – the level of 14000 – can be seen from the higher time frames. If the bulls lose their ground and the bears regain their lost positions, then the latter could test the support at 13785.

US30

The bulls are reigning supreme in the U.S. blue-chip market as well. So far, they managed to breach the key resistance at 33900 and are now heading for the next one at 34300. If the bears manage to turn around and show their teeth, then a successful recovery of their losses could result in a test of the support at 33650.

Daily Pivots: (S1) 1.2806; (P) 1.2868; (R1) 1.2904; More...

USD/CAD retreated ahead of 1.2984 resistance and intraday bias is turned neutral first. On the upside, firm break of 1.2984 will argue that corrective fall from 1.3222 has completed with three waves down to 1.2726. Further rally would be seen back to retest 1.3222 high. On the downside, break of 1.2726 will resume the fall from 1.3222 to 1.2516 key support instead.

In the bigger picture, down trend from 1.4667 (2020 high) should have completed at 1.2005, after defending 1.2061 long term cluster support. Rise from there should target 61.8% retracement of 1.4667 to 1.2005 (2021 low) at 1.3650. This will remain the favored case now as long as 1.2516 support holds.

Daily Pivots: (S1) 0.6997; (P) 0.7018; (R1) 0.7046; More...

Intraday bias in AUD/USD is mildly on the downside at this point, for 0.6868 support. Decisive break there will argue that whole rebound from 0.6680 is finished. On the upside, break of 0.7135 will resume the rise from 0.6680 towards 0.7282 resistance.

In the bigger picture, price actions from 0.8006 (2021 high) is seen more as a corrective pattern to rise from 0.5506 (2020 low). Or it could be a bearish impulsive move. In either case, outlook will remain bearish as long as 0.7282 resistance holds. Next target is 61.8% retracement of 0.5506 to 0.8006 at 0.6461.

Daily Pivots: (S1) 133.25; (P) 133.96; (R1) 134.97; More...

Range trading continues in USD/JPY inside 131.72/135.57 and intraday bias stays neutral first. Overall, corrective pattern from 139.37 will extend further. On the upside, above 135.57 will resume the rebound to retest 139.37 high. On the downside, below 131.72 will resume the fall from 139.37 through 130.38 support.

In the bigger picture, fall from 139.37 medium term top is seen as correcting whole up trend from 101.18 (2020 low). While deeper decline cannot be ruled out, outlook will stays bullish as long as 55 week EMA (now at 122.70) holds. Long term up trend is expected to resume through 139.37 at a later stage, after the correction finishes.