As you must already know, the direction of Gold is mainly dependent on the Price action of DXY (US Dollar index). So first, we take a look at the US Dollar index.
EUR/JPY looks vulnerable
2019-11-11 • Updated
SELL 126.15; TP1 125.90; TP2 125.45; SL 126.40
EUR/JPY failed to settle above the 100-day MA. This line has a bearish bias and acts as resistance around 126.70. The weekly pivot point is also located near this area. As long as the pair is capped by this level, sellers will dominate at this market.
The ECB meeting scheduled later today will lead to an increase in volatility. There are reasons to think that the upcoming move will be to the downside. The bearish targets include a former resistance zone of 125.90 and 125.45 (Fibo level).
On January 12, the Bureau of Statistics will publish the Consumer Price Index (CPI) figures, a key index for determining interest rates. While we await the release, experts forecast a decline in the CPI data, a hint at weaker Dollar values in the global markets.
The trend in the scenario above is clearly bearish. We have also had a recent break of structure at the marked horizontal arrows, which means we can expect price to react from the supply zone that broke the structure.
The first FOMC meeting comes after a buildup of anticipation from traders and investors alike, as the markets await what posture the Fed will take regarding the interest rates; would there be a hike or a cut in interest rates?
Western countries are trying to find other options for oil and gas supplies after a 10th package of sanctions, which will put more pressure on Russian oil and decrease global oil supply. Italy, for example, is in talks with Libya.
Last year was tough for the Japanese yen. USDJPY gained more than 30% over 2022, striking above 150 in October. While anticipation of slower Fed rate hikes pulled the pair below the 130 level at the start of 2023, the speculations over the destiny of BOJ’s yield control policy grabbed the attention of the Japanese assets in the middle of January. What lies ahead for traders of the Japanese yen?