Euro Fundamental Forecast: Bearish Euro weakened last week on hawkish Fed and geopolitical tensions Beware of Russia-Ukraine situation, EUR/USD at risk to escalation Eyes on US data too, FOMC minutes in focus amid hawkish Fed Last Week’s Recap

The Euro weakened this past week, leaving prices at a precarious position amid Russia-Ukraine geopolitical . . . → Read More: Euro Forecast: EUR/USD on Edge Over Russia-Ukraine Risks, Lagarde Cools ECB Hike Bets

Gold Fundamental Forecast: Bullish

Gold prices rose last week after breakeven rates increased following a hot CPI report Escalating tensions on the Ukrainian border bolstered gold’s safe-haven appeal Bullion traders eye Russia’s next move, US retail sales and the FOMC minutes

Gold shined last week, aided by a late-week rally after geopolitical . . . → Read More: Gold Price Forecast: XAU Surges as Russian War Drums Beat, Breakeven Rates Rise

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Super Bowl LVI weekend is here, with the Cincinnati Bengals set to take on the Los Angeles Rams. Data analytics firm PredictHQ suggests that over 100 million Americans will watch the big game on Sunday. And while that may mean more eyeballs for advertisers, it also means that many people will . . . → Read More: Where Will Sports Bettors Go After the Super Bowl?

US DOLLAR FORECAST: Bullish US inflation rate hit a four-decade high of 7.5% in January, surpassing market expectations Fed officials made hawkish-biased comments, strengthening the case of a 50bps rate hike in March The US Dollar may have more room to go up amid heightened inflation and wage pressures

Higher-than-expected US CPI readings . . . → Read More: US Dollar May Strengthen Further as Markets Eye 50bps Fed Rate Hike in March

Bitcoin and Ethereum Charts and Analysis Bitcoin pulling back Thursday’s losses. Ethereum/Bitcoin spread setting up for another break higher?

Thursday’s US CPI print of 7.5% turned risk markets sharply lower as expectations of more, and potentially larger, US rate hikes were priced in for 2022. Across the board, the three-week rally from multi-month . . . → Read More: Bitcoin (BTC), Ethereum (ETH) Recovering Post-Inflation Triggered Losses

AUSTRALIAN DOLLAR FORECAST: BEARISH The Australian Dollar has come under pressure from rate differentials US Dollar asserts dominance over AUD despite record terms of trade US CPI forces the Fed’s hand while RBA dithers. New lows for AUD/USD?

The Australian Dollar seems to be at the whim of external factors once again. While . . . → Read More: Australian Dollar Outlook: Is the US Dollar in the Driver’s Seat for AUD/USD?

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In its most basic form, trading options offers the right to buy or sell an asset at a specified price by a certain date. Options can be used for speculation, hedging, or producing income. Options can offer leverage while capping your maximum loss exposure. When buying an option . . . → Read More: Options 101: Tips for Traders

Russia, Ukraine, Oil, Gold, US Dollar – Talking Points US intel suggests Putin has given “green light” on Russian invasion of Ukraine Gold, Oil, USD all bid in immediate reaction to prospect of war UK evacuating embassy in Kiev, Biden asks US citizens to leave Ukraine

Risk-assets plummeted on Friday afternoon as reports . . . → Read More: Oil, Gold Push Higher as US Intelligence Suggests Russia Could Invade Ukraine “Next Week”

Sterling Weekly Fundamental Forecast: Neutral

Pound Sterling is likely to become even more data sensitive next week in light of UK inflation and employment data, as the local market adjusts to this transitional period of higher interest rates. Adding to the complexity of weekly forecasts is the recent escalation around Ukraine as the . . . → Read More: Pound Sterling Forecast: Will Crucial UK Inflation Data Validate Rate Hike Expectations?

Advertisement US Dollar Outlook: The preliminary February US Michigan consumer sentiment survey missed expectations considerably, falling to its lowest reading since November 2011. Inflation expectations remain tilted higher, both for the 1-year ahead and 5-year ahead readings. According to the IG Client Sentiment Index, the major USD-pairs collectively have a mixed bias at . . . → Read More: US Dollar Steady as Consumer Sentiment Falls to 11-year Lows

EUR/USD Price, Chart, and Analysis

EUR/USD is set to struggle to push significantly higher. Interest rate differentials between the USD and Euro will widen further.

Thursday’s red hot US CPI print of 7.5% and subsequent hawkish Fed speak, sparked a sharp rally in US Treasury yields that saw the rate-sensitive UST 2 . . . → Read More: EUR/USD Outlook Weakens as US Yields Soar, ECB Rows Back Expectations

CBoR Hikes Key Rate by 100 Bps to 9.5%

The Central Bank of Russia decided to hike the key rate by 100 basis points, in line with expectations. The Bank added that should the situation develop in line with its baseline prediction, the Bank of Russia would consider future rate hikes and sees . . . → Read More: Central Bank of Russia Hikes 100 Basis Points to 9.5%, Open to Further Hikes

RAND ANALYSIS US CPI and Fed Bullard comments fade. SONA a non-event for ZAR. Advertisement ZAR FUNDAMENTAL BACKDROP

Last nights State of the Nation Address (SONA) had little to do with the post-US CPI moved on the rand. Mostly US factors dictated the local currency movement however President Ramaphosa made some telling points. . . . → Read More: USD/ZAR Forecast: Rand Fights Back Post-CPI and Bullard

S&P 500, USD Talking Points:

The inflation story in the United States continues to build and the longer we go the less and less ‘transitory’ that it all looks. While prior months saw numerous explainers about how inflation was uneven and likely to abate as much of it was coming from areas like . . . → Read More: S&P Pulls Back, USD Resistance Test, 10 Year to 2% on Massive Inflation Print

U.S. DOLLAR ANALYSIS U.S. CPI (JAN) – HEADLINE ACT: 7.5%, EST: 7.3%; CORE ACT: 6.0%, EST: 5.9% Advertisement

**UPDATE**

U.S. INFLATION PRINT INCREASES HAWKISH FED BETS

Inflation for the January period exceeded expectations (see calendar below). This adds further tightening pressure on the Federal Reserve to start hiking rates giving added impetus . . . → Read More: Breaking News: Hot Inflation Print Sparks Dollar Rally

Ethereum/Bitcoin (ETH/BTC) Chart and Analysis

ETH/BTC spread is testing the bear trend. Altcoins may look to move higher.

The ETH/BTC spread broke above trend resistance yesterday and now needs to consolidate this move over the next couple of sessions to allow the move to continue. This is the third time since mid-May . . . → Read More: Ethereum/Bitcoin (ETH/BTC) Spread – Trend Break Needs Confirmation

AUD/JPY Analysis: RBA and BoJ continue accommodative stance but Aus yields climb higher Markets expect to see 140 bps in RBA rate hikes this year, in contrast to RBA tone Key AUD/JPY Technical Levels analyzed RBA and BoJ Lag Behind other Major Central Banks

The Reserve Bank of Australia (RBA) has gone to . . . → Read More: AUD/JPY Price Forecast: Aussie Extends Gains as Risk Assets Creep Higher

EUR/GBP Price, Chart, and Analysis

ECB hawkishness is being rowed back. A big swing in weekly retail trader positioning.

Keep up to date with all market-moving data releases and events by using the DailyFX Calendar

EUR/GBP continues to give back some of its post-ECB meeting gains as various board members start . . . → Read More: EUR/GBP Outlook Remains Cloudy as US CPI and UK GDP Releases Loom

On the first Wednesday of every month, DailyFX’s Global Head of Content, John Kicklighter, and CEO of IG U.S. Pete Mulmat meet at 9:30a EST to discuss some of John’s top trades for the weeks ahead, while touching on some of their favorite trading strategies. To register for this webinar and hear their . . . → Read More: US Inflation Figures, EURUSD Outlook, and Key JPY Trades with John Kicklighter and Pete Mulmat

US Dollar Talking Points: Tomorrow morning brings the release of CPI data for the month of January. Expectations are high with markets looking for a 7.3% headline print to go along with 5.9% Core CPI print. The US Dollar is holding near two-week-lows ahead of the CPI release: Below I look at which pairs . . . → Read More: US Dollar Price Action Pre-CPI: EUR/USD, GBP/USD, USD/JPY

Leveraged trading in foreign currency or off-exchange products on margin carries significant risk and may not be suitable for all investors. We advise you to carefully consider whether trading is appropriate for you based on your personal circumstances. Forex trading involves risk. Losses can exceed deposits. We recommend that . . . → Read More: 3 Key Tips To Building Your Confidence As A Trader

Gold (XAU/USD) Analysis: Hot US CPI forecast continues to support gold prices in the near-term Net-flows into the worlds largest gold ETF ‘GLD’ slow on the last few days but remains net-positive YTD Long-term range back in focus but political instability complicates the situation

While the relationship of inflation and gold prices appears . . . → Read More: Gold (XAU/USD) Price Forecast: US CPI to Lift Gold Volatility?

GBP/USD Price, Chart, and Analysis

UK 10yr bond yields trim recent highs but remain firm. US CPI and UK GDP will steer GBP/USD in the short term.

Cable (GBP/USD) is nudging higher in early trade, helped by a marginally weaker US dollar and an accommodative UK gilt complex, ahead of two important . . . → Read More: British Pound (GBP) Forecast – GBP/USD Pushing Higher Ahead of Heavyweight Data Releases

Advertisement Euro Outlook: Last week, German inflation data and the European Central Bank rate decision sparked a rally in the EUR-crosses – a rally that may be finished. EUR/USD may be looking at a double top and EUR/GBP is working on a bearish evening star candlestick pattern. If a bullish opportunity exists, it . . . → Read More: Euro Technical Analysis: Signs of a Near-Term Top – Setups for EUR/GBP, EUR/JPY, EUR/USD

Women of the Federal Reserve: How Would They Vote?

On Feb. 3, the U.S. Senate Banking Committee held a nomination hearing for President Joe Biden’s three picks for the Federal Reserve—economists Lisa Cook and Philip Jefferson, and Sarah Bloom Raskin, a former Fed governor, tapped by Biden to be vice chair of . . . → Read More: Women of the Federal Reserve: How Would They Vote?

Dow Jones, S&P 500, Nasdaq 100 Talking Points: Stocks have stepped back from the proverbial ledge after quickly jumping into oversold territory last month. But are equity bears yet done? As Treasury rates continue to rise after last week’s strong NFP report, the bearish side of stocks may come back into favor as investors . . . → Read More: Dow Jones, S&P 500, Nasdaq 100 Forecasts: Bear Bounce Near Complete?

US and Canadian Balance of Trade Figures

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The importance for both the US and Canadian balance of trade data is less about the actual value (apart from something wildly out of the ordinary) and more about how the data . . . → Read More: US and Canadian Balance of Trade Worsens, USD/CAD Unchanged

Gold, US Dollar (USD) Talking Points: Gold prices linger despite escalating tensions between Ukraine & Russia Interest rate expectations and an aggressive Fed may impede further Bullion gains XAU/USD awaits the release of the highly anticipated US CPI print Russia-Ukraine tensions intensify, Gold holds steady

Gold prices are currently trading with listless momentum . . . → Read More: XAU/USD Outlook: Can Russia-Ukraine Tensions Support Gold Prices?

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Advertisement FX Week Ahead Overview: It’s a quieter global economic calendar, but there are still several ‘high’ rated events that will stir volatility. Most of the action comes in the second half of the week. The top billed item on the calendar this week is Thursday’s January US inflation . . . → Read More: FX Week Ahead – Top 5 Events: China New Yuan Loans; US Inflation Rate; German Inflation Rate; UK GDP; US Consumer Sentiment

Gold Talking Points: Gold prices have continued to bounce back after breaking down two weeks ago around FOMC. Gold is now re-testing resistance at a familiar level of 1815, keeping the door open for short-term bearish reversal themes provided that prices close the daily bar inside of this price. The analysis contained in article . . . → Read More: Gold Price Forecast: Gold Testing Key Resistance, Can Bulls Breach?

GBP/USD Analysis: Latest CoT data indicates bearish GBP Positioning Major risk events: UK GDP, US CPI GBP/USD Key Technical Levels Advertisement ‘Smart Money’ Returns to Bearish GBP Positioning

Large institutions and hedge funds (profit-seeking organisations) increased their short Sterling holdings while a decline in longs was also observed. This means that the overall . . . → Read More: GBP/USD Institutional Positioning Turns Bearish Ahead of UK GDP Print

Bitcoin (BTC) Chart and Analysis

Bitcoin takes out resistance over the weekend. Altcoins pushing higher but recent heavy losses are still visible.

In the weekend Bitcoin report, we highlighted that a potential break higher was being kept in check by both the downward trend and the important $39.6k levelformed off the September . . . → Read More: Bitcoin (BTC) Breaks Through Noted Resistance, Eyes Further Gains

EUR/USD ANALYSIS Euro may no longer be the flavor of the month! Spotlight on ECB’s Lagarde later today. Advertisement EURO FUNDAMENTAL BACKDROP

The Euro is trading lower in early trading this morning after last weeks stellar performance on the back of a perceived ‘hawkish’ pivot by the ECB. Cold water was poured on . . . → Read More: EUR/USD Forecast: Beloved Euro Opens Lower as Markets Digest US Jobs Report

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Weekly Fundamental Gold Price Forecast: Neutral Sovereign bond yields continue to rise while inflation expectations pullback. It’s not a good mix for gold prices. If real yields – nominal yields less inflation – continue to rise, gold prices are likely to come under renewed pressure. The IG Client Sentiment Indexsuggests that . . . → Read More: Weekly Fundamental Gold Price Forecast: Rising Rates Still Problematic

In another volatile week for global market sentiment, Wall Street managed to close in the green, but not without giving up most gains. Nasdaq 100, S&P 500 and Dow Jones futures finished +1.41%, +1.39% and +0.99% respectively. This helped the VIX market ‘fear gauge’ drop 16%. European equities were mixed with Asia-Pacific markets . . . → Read More: Markets Week Ahead: Nasdaq 100, US Dollar, CPI, Euro, British Pound, UK GDP

S&P 500 FORECAST: Bullish The S&P 500 index may shrug off disappointing Facebook results after Amazon topped market expectations So far in the earnings season, over 80% of the S&P 500 companies have beaten earnings forecasts Pfizer and Twitter results are in focus this week, which may set the tone for the broader . . . → Read More: Twitter and Pfizer Earnings in Focus After FAANG Deliver Divergent Results

MEXICAN PESO FORECAST: SLIGHTLY BEARISH U.S. inflation data could help consolidate expectations of a 50bp hike by the Federal Reserve following strong NFP numbers Banxico is seen lifting borrowing costs by a quarter percentage point next Thursday, but the decision has been fully priced in The Mexican peso may remain biased to the downside . . . → Read More: Mexican Peso Outlook: U.S Inflation Data & Banxico Decision will Be Key for USD/MXN

EUR/USD ANALYSIS Markets may be getting carried away post-ECB. Euro bond spreads thinning. Advertisement EURO FUNDAMENTAL FORECAST: BEARISH

Yesterday saw a significant upside shift in EUR/USD price action (largest single day move since December 2020) after the ECB’s President Christine Lagarde acknowledged more persistent inflationary risks.

A previously omitted 2022 . . . → Read More: Euro Weekly Forecast: EUR/USD Upside Rally May be Waning after ‘Hawkish’ ECB

US Dollar Talking Points

The US Dollar Index (DXY) bounces back from a fresh monthly low (95.14) following the 467K rise in Non-Farm Payrolls (NFP), and the update to the Consumer Price Index (CPI) may fuel the recent rebound in the Greenback as the gauge for inflation is expected to increase for . . . → Read More: US Dollar to Stage Larger Recovery on Another Rise in US CPI

Bitcoin (BTC) and Ethereum (ETH) Charts and Analysis Cryptocurrencies hit by US good news means bad news theory. Bitcoin trying to break the important $39.6k barrier.

The latest look at the US jobs market shows companies continue to hire at a rapid pace despite fears that Omicron would curtail business activity. The . . . → Read More: Bitcoin (BTC), Ethereum (ETH) Pushing Higher Into Weekend on Robust NFP Release

AUSTRALIAN DOLLAR FORECAST: NEUTRAL The Australian Dollar has rallied even though the RBA baulked at rate hikes Commodities continue higher but the US Dollar asserts dominance for AUD The Aussie appears to be at the whim of external factors. Where to for AUD/USD?

The Australian Dollar whipsawed this week as the RBA . . . → Read More: Australian Dollar Outlook: The RBA Tightens Quantitatively but Hesitates on Rates

Earnings Preview: Disney, Twitter, Uber, Alibaba S&P 500, Dow Jones, Nasdaq close higher after volatile trading amid earnings season Disney, Twitter, Uber and Alibaba eyed in the next round of high-profile reports A light economic calendar sees traders focusing on examining financial statements

US markets are set for another round of high-profile earnings, . . . → Read More: S&P 500, Dow Jones Whipsaw May Continue: Earnings Outlook – Disney, Twitter, Uber, Alibaba

Crude Oil, WTI, Brent – Talking Points Crude oil prices climb to a highest level since 2014, can oil claim $100? US winter storms contribute to fears of further supply disruptions Will tensions between Russia and Ukraine continue to drive prices higher? US storms and rising tensions between Ukraine and Russia boost Oil prices . . . → Read More: Crude Oil Outlook: Oil Sets Fresh 7-Year High, $100 Now in Sight

GBP/USD FUNDAMENTAL HIGHLIGHTS: BoE Hawkish But Don’t Get Carried Away EUR/GBP Working Key Weekly Reversal

The Bank of England delivered a 25bps rate rise to 0.5%, as widely expected. The surprise came from the fact that there was a vote split on a large hike, with four members voting in favour of a . . . → Read More: GBP/USD Weekly Forecast: GBP Struggles, EUR/GBP Faces Reversal Risks

Bitcoin, USD Talking Points Bitcoin prices shows initial sensitivity to positive NFP report BTC/USD continues to challenge $38,000 USD strength remains a key catalyst for digital assets Positive NFP report forces BTC lower, bulls immediately retaliate

Bitcoin prices have continued to trade within a well-defined range as bulls continue to wrestle with trendline . . . → Read More: Bitcoin Setup – BTC/USD Wrestles With Resistance After Optimistic NFP

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NFP, Non-farm Payrolls, USD Talking Points: This morning brought the release of Non-farm Payrolls for the month of January. Expectations were very low after the earlier-week ADP report showed a contraction of 307k versus an expectation for a gain of 201k. The analysis contained in article relies on price action . . . → Read More: NFP: Non-farm Payrolls Prints at 467k, USD in Focus After Going Oversold

Brent Crude Oil Analysis: Crude output Lower than Anticipated as OPEC+ Nations Wrestle with Capacity Constraints Recent oil price surge attributed to possible supply disruption due to conflict – OPEC+ delegates Brent crude oil: Key technical levels analysed Output Lower than Anticipated as OPEC+ Nations Wrestle with Capacity Constraints

On Wednesday this week, . . . → Read More: Crude Oil Price Forecast: Could Oil Hit $100 after Marking 7 Year High?

EUR Analysis and News:

ECB Pivot Catapults Euro Higher BoE Hawkish Decision Tempered by Dovish Bailey ECB Out-Hawks BoE as EUR/GBP Reverses

ECB Recap

ECB President Lagarde delivered arguably her most hawkish press conference. In light of Eurozone inflation hitting a record high of 5.1% , the ECB President stated that . . . → Read More: Euro Forecast: EUR/USD Soars on ECB Pivot, EUR/GBP Reversal as ECB Out-Hawks BoE

Euro, Pound, EUR/USD, GBP/USD, EUR/GBP Talking Points: This morning brought rate decisions out of the Bank of England and the European Central Bank. While the Bank of England hiked rates, GBP/USD showed a restrained move of strength. And even though the ECB merely opened the door to a possible shift, EUR/USD has put in . . . → Read More: Euro, Pound Technical Analysis: EUR/USD, GBP/USD, EUR/GBP

U.S. DOLLAR ANALYSIS U.S. ISM Services (JAN) – ACT: 59.9;EST: 59.5. ECB slight hawkish pivot weighing down on DXY. Trendline support holding. Advertisement ISM SERVICES PMI HELPS FADING DOLLAR

Both ISM non-manufacturing and Markit services data prints beat estimates for the January 2022 period. Services data traditionally carries greater weight for the U.S. . . . → Read More: Breaking News: Beat on ISM Services PMI (Jan) 59.9, DXY Finds Support

ECB Governing Council, Euro Talking Points ECB main interest rate remained unchanged – as expected Today marks the first interest rate meeting of the Governing Council in 2022 Record high inflation (5.1% for January) tests the ECB’s ‘lower inflation’ forecasts Slowing economic growth may be referenced in support of continued stimulus ECB Main Refinancing . . . → Read More: ECB Leaves Interest Rate Unchanged at 0%, Highlights Flexibility of Approach

Bank of England and GBP/USD Price, Chart, and Analysis

The BoE increases UK interest rates by 25 basis points. BoE to start unwinding its GBP895 billion quantitative easing program.

*** Updates ***

Sterling rose sharply post-BoE release with cable (GBP/USD) trading as high as 1.3620 from 1.3565 pre-release, while EUR/GBP fell . . . → Read More: Hawkish Bank of England (BoE) Hikes Rates by 0.25%, Sterling Jumps

EUR/USD Analysis Spotlight on ECB press conference: Inflation! Inflation! Inflation! EUR/USD hovers around 1.13, pending fundamental catalyst. Advertisement EURO FUNDAMENTAL BACKDROP

After recent economic data throughout the region, hawkish pressure has been mounting on ECB officials. Yesterday’s Euro zone CPI beat echoed prior releases from constituent nations in addition to prior growth and . . . → Read More: ECB Preview: Inflation Impact on Tightening in Focus, EUR/USD Poised

US Dollar Price, Chart, and Analysis

US Dollar (DXY) remains in the middle of a positive trend Further losses may attract buyers back into the market.

This week’s US dollar sell-off continues today with the US dollar basket (DXY) trading at a one-week low on either side of 96.00. The greenback has . . . → Read More: US Dollar Outlook: Short-Term Shakeout Back Into a Zone of Support

EUR/USD Analysis Core and Headline EU inflation heats up! ECB hawkish pressure increases. IG Client Sentiment: Bullish. Advertisement EURO ZONE INFLATION BOOSTS HAWKISH BETS, EUR/USD HIGHER

EU core and headline inflation prints beat estimates (see economic calendar below) with Italian data following suit. The Euro has been appreciating against the greenback this week . . . → Read More: Euro Breaking News: EU CPI On the Rise, Core at 2.3% While Headline Hits 5.1%

Bitcoin, Ethereum Analysis: Bitcoin’s bullish move at risk around zone of resistance Ether (ETH) highlights potential range, conditional upon upside rejection Crypto Fear and Greed Index offers insight into recent crowd psychology Advertisement Bitcoin Grinds Higher but Faces Huge Levels of Resistance

Bitcoin started the year in the same way it finished 2021, . . . → Read More: Bitcoin, Ethereum Finds Major Resistance – Levels to Consider

CRUDE OIL OUTLOOK: Standstill at 7-year highs continues as OPEC+ output update looms Prices shrug at API weekly inventory data, official EIA version due Negative RSI divergence hints steep rally may running out of steam

Crude oil prices covered little ground after a volatile session. The WTI benchmark seesawed in 3-4 percent intraday . . . → Read More: Crude Oil Prices Await OPEC+ Output Pledge. Will 7-Year Highs Hold?

EURO, SWISS FRANC, EUR/CHF OUTLOOK, RUSSIA-UKRAINE TENSIONS – TALKING POINTS The Euro is vulnerable to a rapid selloff if Russia-Ukraine tensions continue to escalate Swiss Franc could rise; political risks may put premium on Europe’s anti-risk currency Nord Stream 2 pipeline is a key political lever. Could sanctions push oil prices higher?

The . . . → Read More: Euro Outlook Bearish on Russia-Ukraine Tensions. Crude Oil, Swiss Franc to Rise?

Euro, EUR/USD Talking Points: Last week saw the Euro break down against the USD, setting a fresh yearly low. After a doji on Friday, Monday saw a strong bullish move to create a morning star reversal formation. So far on Tuesday that strength has continued on Tuesday and the big focus is on European . . . → Read More: Euro Technical Analysis: EUR/USD Morning Star, ECB on Deck

US Manufacturing PMI Just Edges Estimate US Manufacturing PMI = 57.6 (actual) vs 57.5 (expected)

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The US manufacturing sector expanded for the 20th month in a row. While September to November we saw prints above 60, the January figure below . . . → Read More: ISM Manufacturing Data at 57.6: Employment and Prices Rise

Bitcoin, USD Talking Points Bitcoin prices climb above the key psychological level of $38,000 BTC/USD benefits from the regulatory environment USD weakness supports cryptocurrency Bitcoin Prices Edge Higher

Bitcoin prices have recently managed to break above the $38,000 handle after bulls regained confidence above key technical levels.

Visit the DailyFX Educational Center . . . → Read More: Bitcoin Setup – BTC/USD Bulls Take Control of the Trend

GBP/USD Price, Chart, and Analysis

UK manufacturing confidence underpins Sterling. Bank of England rate hike expectations hit 100%.

The final UK Markit/CIPS manufacturing PMI (January) beat earlier expectations but fell short of last month’s robust figure. The dip lower reflected slower growth or new orders and a further easing in the rate . . . → Read More: British Pound Outlook: GBP/USD Tests 1.3500 on Robust Data and BoE Rate Forecast

EUR/USD Analysis: German Bund Yield temporarily trades above zero as markets bet against ECB rate hiking timeline Positioning readjustment in USD after a largely bid dollar towards month end EUR/USD Key Technical Levels Heading into ECB Rate Decision Advertisement German Bund Yield Breaches the Zero Mark Once more

Yesterday, German 10-year Bund yields . . . → Read More: EUR/USD Temporary Lift but Downside Risks Remain Ahead of ECB Event

Gold Price talking points: Last week started with strength for Gold as the yellow metal tipped-up to the 1850 spot of resistance on the chart. But that was quickly faded with another injection of weakness around the FOMC rate decision. Gold prices are bouncing from fresh monthly lows on the final trading day of . . . → Read More: Gold Price Forecast: Gold Breakdown Pulls Back – XAU/USD Levels

GBP/USD Price, Chart, and Analysis

Redacted report due to Metropolitan Police investigation. Boris Johnson escapes full censure for now.

The political pressure on UK Prime Minister Boris Johnson is likely to ease in the short-term after civil servant Sue Gray presented the PM with the latest update of her investigation. The report . . . → Read More: UK Partygate Investigation: Heavily Censored Report Given To PM Johnson, Sterling Unchanged

Despite trading near all-time highs, equity indices may be a source of volatility and two-sided action as changing interest rates, inflation, and COVID-variants are likely to continue dominating headlines in early 2022.

Volatility in Equity Indices

Source: tastytrade

Implied Volatility of Index ETFs 12/17/21

Implied volatility has been on the . . . → Read More: Small, Short-Term Plays in Equity Indices: Top Trade Q1 2022

Mexican GDP Contracts in Q4 2021

Q4 GDP = – 0.1% (Quarter on Quarter)

GDP (Year on Year) = + 1.0%

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Mexico’s gross domestic product (GDP) contracted in the fourth quarter by 0.1% from the previous three-month . . . → Read More: Mexican GDP Contracts 0.1% in Q4 2021 and Enters Technical Recession

EUR Analysis and News:

EZ GDP Prints Largely In-Line All Eyes on the ECB’s Possible Hawkish Pivot EUR/USD Recovers Slightly as USD Unwinds Recent Gains

EUROZONE GDP: Y/Y 4.6% vs Exp. 4.7%, Q/Q 0.3% vs Exp. 0.3%

GDP largely in line with consensus, albeit a slight miss on the yearly rate. . . . → Read More: EUR/USD Price Outlook: Euro Attempts Recovery, GDP Meets Expectations

Global risk appetite swung wildly last week. Wall Street saw a recovery into the weekend, with the S&P 500 seeing its largest surge since June 2020. Futures tracking the Dow Jones, S&P 500 and Nasdaq closed +1.33%, +0.73% and +0.03% respectively. The VIX ‘fear gauge’ closed slightly lower, but remains elevated. Equities in . . . → Read More: Markets Week Ahead: Dow Jones, S&P 500, US Dollar, Gold, AUD/USD, EUR/USD, GBP/USD

Advertisement Euro Fundamental Forecast: Bearish

It’s difficult to consider the Euro’s potential without considering the glaringly obvious differences in the path to normalization for the ECB when compared to other major central banks. Admittedly, the Eurozone is very different in its make up to other single countries but right now its difficult . . . → Read More: Euro Weekly Fundamental Forecast: EUR/USD Slide to Continue

Gold Price Talking Points

The price of gold trades to a fresh monthly low ($1780) as the Federal Reserve unveils a more detailed exit strategy, and fresh data prints coming out of the US may keep bullion under pressure as the Non-Farm Payrolls (NFP) report is anticipated to show a further improvement . . . → Read More: Gold Price Snaps January Opening Range Amid Detailed Fed Exit Strategy

US Dollar Fundamental Forecast: Bullish US Dollar continued gaining on risk aversion and Fed rate hike estimates Focus this week shifts to US non-farm payrolls, which includes wage data RBA, ECB and BoE could offer hawkish tilts, will this induce risk aversion?

The US Dollar roared higher this past week, catapulted by . . . → Read More: US Dollar Outlook: Hawkish Fed Has Markets Eyeing NFPs, RBA, ECB and BoE

Bitcoin (BTC) Chart and Analysis Bitcoin’s tepid rebound Important resistance levels will likely hold any move higher

Federal Reserve chair Jerome Powell put the dampers on risk markets late Wednesday by suggesting that monetary tightening in the US would be quicker and more potentially more aggressive than originally thought. Risk markets, already . . . → Read More: Bitcoin (BTC) Outlook – Buy the Dip or Sell the Bounce?

WTI OIL WEEKLY FORECAST: CAUTIOUSLY BULLISH Crude oil has risen aggressively in recent weeks amid supply and demand imbalances. Since its December low, WTI is up about 42%, while Brent has jumped roughly 39% Under normal circumstances, an overextended rally could lead to a reversal, but rising geopolitical tensions in Eastern Europe may . . . → Read More: Crude Oil Forecast: Russia-Ukraine Crisis Creates Upside Risks for WTI & Brent Prices

AUSTRALIAN DOLLAR FORECAST: BEARISH

The Australian Dollar started last week on the back foot after the release of PMI data on Monday. The January numbers show the IHS Markit Australian Composite PMI fell to 45.3 from 54.9 previously.

Tuesday saw the release of CPI with both the headline and trimmed . . . → Read More: Australian Dollar Outlook: All Eyes on the RBA as Fed Fallout Continues

GBP/USD ANALYSIS Advertisement BRITISH POUND FUNDAMENTAL FORECAST: MIXED

Sterling has been on a rapid decline against the U.S. dollar since mid-January which was exacerbated this week after the Federal Reserve emphasized rate hikes in the near future. The UK comes under pressure from inflation (see chart below) as with most nations across the . . . → Read More: British Pound Forecast: GBP/USD Awaits Potential BoE Balance Sheet Bonanza

Leveraged trading in foreign currency or off-exchange products on margin carries significant risk and may not be suitable for all investors. We advise you to carefully consider whether trading is appropriate for you based on your personal circumstances. Forex trading involves risk. Losses can exceed deposits. We recommend that . . . → Read More: 3 Key Options Trading Tips

PCE Inflation Beat Fails to Extend Dollar Bull Run PCE = 5.8% (actual) vs 5.7% (previous) Core PCE = 4.9% (actual) vs 4.8 (estimate)

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Personal Consumption Expenditure naturally attracts a lot of attention as the Fed’s preferred measure of inflation. . . . → Read More: Breaking News US PCE Heats Up: Core PCE at 4.9% vs 4.8% Expected

US Dollar Analysis and News

USD Remains Bid, Markets Pricing in 4 Hikes By September Possible Overextension in the Dollar on Month End Flows, Eyes on London 4pm FIx

The US Dollar remains on the front foot following the fallout of Powell’s hawkish press conference (full commentary). At the same, I also . . . → Read More: US Dollar Remains Bid, However, Nears Overextended Territory

AUD/USD Price, Chart, and Analysis

AUD/USD testing psychological and multi-moth support. RBA monetary policy meeting next week.

The Australian dollar continues to weaken against a powerful US dollar with AUD/USD now pressing down on a notable multi-month support level. This level, either side of 0.7000, has held three tests over the past . . . → Read More: AUD/USD Breaking Down as Multi-Month Support Creaks

EUR/USD Analysis Stacked economic calendar next week. ECB in focus. Strong downtrend may be waning. Advertisement EURO FUNDAMENTAL BACKDROP

After the Federal Reserve’s hawkish slant earlier this week, the ECB will be in full view next week particularly around its inflationary stance. The divergence between the two major central banks are stark however . . . → Read More: Euro Technical Forecast: EUR/USD Bear Flag Break Seeks Support

GOLD PRICE OUTLOOK: Gold prices sink as the markets re-price for a more hawkish Fed Traders’ focus now turns to December’s US PCE inflation gauge Prices are on the cusp of breaching 7-month rising trend support

Gold prices have taken a beating in the wake of this week’s FOMC monetary policy announcement. A . . . → Read More: Gold Price Drop Tests 7-Month Uptrend as Key US Inflation Data Looms

US Dollar, DXY Index, Treasuries, Fed, Gold, Crude Oil – Talking Points The US Dollar has found solid footing as the Fed signals rates liftoff Energy, commodities and industrial metals remain at elevated levels With short-end yields on the rise, will the US Dollar make new highs?

The US dollar soared as the . . . → Read More: DXY Dollar Index Leaps to New Highs on a Hawkish Fed. Will USD Keep Going North?

Gold talking points: Gold gave bulls a brief moment of excitement earlier this week when prices tested through the 1850 level of resistance. But, that test was short-lived and it took place during my Tuesday webinar. I remarked that the setup looked prime for a fade (reversal) and now Gold prices are $50 lower, . . . → Read More: Gold Price Forecast: Gold Goes Reversal, 1800 Snap Back on FOMC

Pound, Dollar Talking Points: GBP/USD under pressure, UK politics weigh on sentiment US Dollar strength undermines Sterling after hawkish commentary from the Federal Reserve The future of Prime Minister Boris Johnson remains uncertain, a potential catalyst for price action

The British Pound has dropped to a fresh monthly low against the US Dollar . . . → Read More: British Pound Technical Analysis: GBP/USD Nosedives After Fed Meeting

GDP Main Talking Points: GDP increased to an annual rate of 6.9% in Q4 of 2021 GDP accelerates after reporting only 2.3% in Q3 of 2021

Economic Calendar

Gross Domestic Product (GDP)

grew at a 6.9% through the last quarter of 2021 which came in way above median forecasts of 5.5%. . . . → Read More: GDP Growth Surpassed Expectations Despite Omicron

RAND ANALYSIS SARB raises rates by 25bps to 4%. Initial reaction: marginal rand weakness Advertisement MPC PROVIDES NO SURPRISES LEAVING RAND FAINTLY LOWER

The SARB announced on Thursday that the repo rate will be increased to 4% from 3.75%. Four members of the MPC voted for a rate hike while one member voted . . . → Read More: Expected SARB Hike Comes to Fruition at 4%, USD/ZAR Subdued

EUR/USD, Post FOMC Analysis: Diverging rate expectations between Fed and ECB fires EUR/USD lower Italian elections enters home stretch as the all-important fourth ballot proceeds today EUR/USD Key technical levels analyzed and discussed Advertisement

The Euro is marginally weaker against most G10 currencies but is particularly susceptible to the renewed dollar strength after . . . → Read More: EUR/USD Hit After Fed Hawkish Confirmation

As you get your FOMC price action setups and fundamental forecasts in order, DailyFX is here to help. Our very own CEO of IG US Pete Multant and Global Head of Content John Kicklighter just hosted a detailed webinar ahead of today’s rate decision.

Fed Outlook is Hawkish

. . . → Read More: Trading EURUSD and USDJPY for FOMC with John Kicklighter and Pete Multant

BoC Decides to Leave Rates Unchanged

* Update 15:28 GMT

Bank of Canada decides against raising the overnight target rate. Remains at 0.25%

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the Bank expects Canada’s economy to grow by 4% in 2022 and about 3½ % in 2023. . . . → Read More: BoC Leaves Rates Unchanged at 0.25% – Foresees Inflation at 3% for 2022

Bank of Canada Main Talking Points: BoC held its target for overnight rate at the lower bound of 0.25%, bank rate at 0.5%, and deposit rate at 0.25% Reports economic slack has now been absorbed with the Bank removing its forward guidance The Bank of Canada

decided to hold its target for rates . . . → Read More: The Bank of Canada Holds Key Rate Unchanged, 0.25%

US Dollar and DXY Analysis: USD Fundamentals look supportive ahead of FOMC – safe-haven and liquidity Dollar Index (DXY) positioning only slightly lighter after sizeable dollar sell-off Key DXY technical levels ahead of the FOMC meeting and presser US Dollar Fundamentals: USD Supported Ahead of FOMC Meeting

The US dollar has experienced a . . . → Read More: Supportive USD Fundamentals and DXY Setup Ahead of FOMC

USD/CAD, BOC Price Analysis & News

BoC Rate Hike is a Coin Toss Markets Attach 80% Probability of a Hike, While Economists Stick to Unchanged

OVERVIEW: The Bank of Canada meeting is the first of today’s keenly awaited central bank meetings. With the direction of monetary policy abundantly clear, today’s meeting is . . . → Read More: Bank of Canada Preview: How Will the Canadian Dollar React?

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Advertisement Central Bank Watch Overview: Rates markets are anticipating the Federal Reserve to hike rates by 25-bps in March, as soon as the QE taper is finished. Expectations for a 50-bps rate hike persist, though they have pulled back considerably ahead of the January Fed meeting. The commentary around the . . . → Read More: Central Bank Watch: Fed Speeches, Interest Rate Expectations Update; January Fed Meeting Preview

Bitcoin, USD Talking Points Bitcoin prices cling to support as Fed decision drives sentiment BTC/USD sell-off loses steam, prices temporarily stabilize around key psychological level of $36,000 USD safe-haven appeal weighs on risk assets Will the FOMC pave the way for Bitcoin?

A shift in risk sentiment currently continues to impact Bitcoin (BTC) . . . → Read More: Bitcoin Price Setup – Will the Fed drive the next move for BTC/USD?

IMF U.S. Main Talking Points: IMF reduced U.S. growth forecast to 4.0% for 2022 Tapering, Inflation and Omicron are main contributors to economy slowdown

IMF reported U.S. growth at 4.0% for 2022, down 1.2 percentage points than initially predicted. With the new Omicron variant, U.S. renewed restrictions and enforced lockdowns. The path that . . . → Read More: IMF Cuts U.S. Growth for 2022 in WEO Forecasts

FX Analysis: S&P jitters may signal greater volatility ahead as Russia, US situation on a knife-edge AUD/USD and USD/ZAR pairs highlighted as USD often favored during uncertainty This article makes use of fundamental FX themes and topics. Take a look at our comprehensive Education section for more info

Yesterday’s rare and unusual move . . . → Read More: FX Pairs to consider in the Wake of Geopolitical Tensions, Stock Market Jitters

Gold Price (XAU/USD), Chart, and Analysis Wednesday’s FOMC monetary policy decision remains key. Gold getting a risk-off bid as Russia ramps up invasion fears.

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Tomorrow’s FOMC rate decision and chair Powell’s subsequent press conference will hopefully give the markets a . . . → Read More: Gold (XAU/USD) Buffeted by Fed Rate Hike Risk and Russia/Ukraine War Fears

Gold, US Dollar (USD) Talking Points: Risk off sentiment boosts safe-haven Gold

Gold prices have held onto recent gains as investors reduced their appetite for risk. With rising tensions between Russia and the Ukraine, geopolitical risks and the upcoming Fed meeting allowed the precious metal to resume a move towards trendline resistance.

. . . → Read More: Gold Price Setup: Bullion bulls lead the way, XAU/USD Levels

US Dollar, EUR/USD, GBP/USD, AUD/USD, USD/CAD Talking Points:

The US Dollar is running higher as stocks continue to get slammed ahead of the January FOMC rate decision. The fear is that the Fed is nearing a hawkish pivot with unknown consequence. The bank said they were looking at a possible 2-3 rate hikes . . . → Read More: US Dollar Price Action Setups: EUR/USD, GBP/USD, AUD/USD, USD/CAD