Technical Analytics Report

Daily Market Reviews 20 Dec 2021

EUR/USD

 

The European currency showcased combined market movements while trading against US dollar within today’s Asian trading session, combining afterwards a sudden decrease of the instrument on last Friday. Within the same time, EUR/USD is tested at level of 1.1250 reaching a breakout, awaiting fresh drivers to be visible in the market. At the same moment of time, after all the meetings of all the world’s leading regulators that were held in the last week, there are few associated risks that trading activity will sharply decline in prediction of the winter vacation. Following one way or another, the macroeconomic calendar for the beginning of the week is comparatively empty, so all the market participants are likely to remain the same after taking a lead from Friday’s statistics. Data shown from Germany disappointed investors with a sudden drop in business optimism in the month of December. The German IFO Business Climate Index went down from 96.6 to 94.7 points which was opposite to the forecast of 95.3 points, and the German present Assessment revived from 99 to 96.9 points, while the German Business Expectations went down from 94.2 to 92.6 points, which also showcased worse than forecasts at 93.5 points by expert analysts. The Consumer Price Index within the euro zone in November month spiked down from 0.8% to 0.4%, but maintained at the stagnant growth rate in yearly terms at 4.9%.

 

GBP/USD

 

The British pound is trading in multiple directions, remaining constant at fair narrow range, except for a rise in activity at the end of last week. On December 16, the instrument showcased unexpected rise and grown from highs on local market from November 24, in answer to the sudden decision of the Bank of England towards increase in the interest rate by 25 basis points. As an argument in regard of stricting monetary policy, the British regulator expectedly brought high inflation rates, considering all the  positive prospects for the national economy in closer time span. Last Friday, the dollar went above off losses, and GBP/USD fastly retreated on values at 1.3250 points. The pound ignored another strong data on the volatile movements of retail sales in the UK in November: the monthly indicator went up from 1.1% to 1.4%, and the annual yearly  growth rate leveled to 4.7% after going down by 1.5% a month earlier.

 

AUD/USD

 

The Australian dollar is rapidly going down within the Asian trading session, getting ready to be tested at 0.7100 for a breakdown. The instrument is showing a very strong and bearish impact, formed at the end of last week which is against the background scenario of the absence of fresh drivers on the market. Investors, on the other hand, are in no rush to venture into new positions on the eve of the winter holidays. The focus of traders’ attention at present is all focused on the decision of the People’s Bank of China. For the very first time since April 2020, the Chinese regulator brought down the interest rate from leading borrowers from 3.85% to 3.80%, and for loans of 5 years, the previous rate stagnated at 4.65%. Interesting facts and statistics from Australia will appear only on Tuesday, when the Reserve Bank of Australia will publish the minutes of its last meeting this year. Market movements may also be facilitated by the latest data on the volatile market movements of US GDP for Q3 2021, to be published on Wednesday.

 

USD/JPY

 

The American currency is showing flat trading dynamics paired with the Japanese yen, combining close to 113.50.All the Market activity remains settled, as the macroeconomic calendar at the beginning of the week is comparatively nullified, and market participants are slowly getting ready for the winter holidays and are in no rush to venture into new deals. The dollar, which revived an unexpected impact to raise at the end of last week is still quite attractive for getting an investment: its quotes shooted up against the background of all the inventory of the US Fed’s members about the starting of a procedural stricting of monetary policy. Previously, the American regulators announced the increase of the rate of curtailment of quantitative easing (QE) program, which will allow the Fed to get into the web of interest rate rise in March 2022. Generally, the US Fed has an agenda to raise its level three times next year, if the situation develops according to a favorable scenario. In this case, the Bank of Japan is going to be noticeably a little low compared to the American regulator. Last Friday, Japanese officials decided its interest rate at -0.1%, but also announced a decline to the emergency funding program, taking care of the progress of the recovery of the national economy.

 

XAU/USD

 

Gold quotes are getting traded at a level of 1800.00. The instrument at the end of trading last week had sudden growth, but the volatile market movements turned out to be very unfocused, which was facilitated by the decisions of the Bank of England and the US Federal Reserve on rigid monetary policy. The British regulator took a sudden strict decision to raise the interest rate by 25 basis points, while the US Fed quite forcibly announced a sudden decline in the quantitative easing (QE) program and predicted chalked out plans for upcoming year in the form of a three times raise in the interest rate. On Wednesday, both the UK and the US are going to publish their Q3 2021 GDP data, but on the other hand, trading is likely to remain settled as many investors will take their required Christmas vacation.