Daily Market Analysis By FXOpen

Tesla's Bleak Month Continues, but Is It Really That Bad?
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Share price volatility has been synonymous with Tesla for many years now, the company's unique, somewhat giant character echoing the polarising nature of its founder and CEO, Elon Musk.

An unusual company among its big-cap peers, Tesla is one of the most popular stocks on the global market, its volatility offering a diversion from steady, conservative bricks-and-mortar companies, which often dominate the top-tier blue-chip contingents of well-respected indices.

Since 2024 began just two weeks ago, Tesla shares have been declining in value at a rate that is relatively rapid for a firm whose stock is listed on a major exchange and whose peers are the 'Magnificent 7' tech firms which dominate North America's tech stock environment.

On December 28, 2023, FXOpen charts showed Tesla stock to be trading at $264 per share; however, as the new year began, Tesla started to decline and has continued on that trajectory thus far, arriving at $218.55 by the earliest hours of the European session this morning according to the FXOpen chart.

Some reports cite that Tesla stock has fallen by as much as 12% since the start of the year and allude to a 'sell-off' by many investors.

This is a very interesting period of volatility for Tesla, especially given the bullish trend towards tech stocks in general during the course of last year, in which they collectively rose from the doldrums that blighted the tech stock market during 2022 and doubled in value during the course of 2023.

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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

US Dollar Holds Up Well Despite Slight Inflation Increase Spurring Pessimism
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This morning, as the week's trading begins, a small fly has landed in the otherwise very clear ointment with regard to the anticipated interest rate reductions that Western central banks could make during the early to middle parts of 2024.

Optimism ruled in the earliest days of the new year when mainstream commentary was adorned with reports suggesting that the levels of inflation that had created serious economic concerns in the United States were now under control and have been for some time, allowing the Federal Reserve Bank to possibly review its ultra-conservative monetary policy of continuing rate increases despite over a year of decreasing inflation.

Reports which take into account the inflation figures within the US economy across the entirety of 2023 are now beginning to surface, and it appears that inflation from January 2023 to December 2023 stood at 3.4%, whereas January 2023 until November 2023 showed an inflation figure of 3.1%.

Compounding this matter, the Consumer Price Index rose by 0.3% in December 2023 compared to having fallen by 0.1% in November 2023.

Whether this is enough of a blip to turn the consensus away from the Federal Reserve Bank looking at reducing interest rates during the course of 2024 is yet unknown; however, perhaps the central bank's unusually cautious approach, which was displayed during 2023, can be considered in these circumstances.

As far as reaction within the currency markets is concerned, the US dollar has not declined against other Western-market major currencies by any level significant enough to consider it related to December's inflation figures.

In Britain, a similar central bank policy - a policy of ultra-conservatism - has been implemented to attempt to curb similar levels of rampant inflation which took place two years ago and sustained itself for many months, accompanied by a high-profile 'cost of living crisis', however when looking at the value of the British pound against the US dollar this morning, the pound has not gained much ground.

Pricing according to FXOpen charts shows that on Friday, January 12, the GBPUSD pair was trading at 1.27473, whereas this morning, during the early hours of the London trading session, the GBPUSD pair was trading at 1.27419.

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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

EUR/USD, GBP/USD, USD/CAD Analysis: The Dollar Declines after the Release of Data on the Producer Price Index
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The dollar fell on Friday after US producer prices fell unexpectedly in December, fueling expectations of an imminent US rate cut. The final demand producer price index decreased by 0.1%, which was due to a decrease in the cost of goods. Prices for services remained unchanged last month, raising the possibility of lower inflation in the coming months. The US currency previously benefited from risk aversion after strikes in Yemen came in response to attacks by Iran-backed Houthi forces on shipping in the Red Sea, widening the regional conflict caused by Israel's war in the Gaza Strip. Traders see an 80% chance of an interest rate cut in March, up from around 70% chance seen before the PPI report.

EUR/USD
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The EUR/USD pair is trading around the 1.0960 level, moving away from last week's lows. According to EUR/USD technical analysis, Immediate resistance can be seen at 1.1000, a break higher could trigger a move towards 1.1045. On the downside, immediate support is seen at 1.0940, a break below could take the pair towards 1.0910.

The euro was put under pressure by soft comments from the ECB. ECB President Christine Lagarde said on Thursday that the worst of inflation is likely over and that interest rates will be cut if inflation falls to 2%. Dismissing those expectations, ECB chief economist Philip R. Lane said recent inflation data broadly supported the central bank's current views, meaning rate cuts were not on the table for debate in the near future. On the data side, France's consumer price inflation (CPI) rose 4.1% year-on-year in December, while Spain's annual inflation fell to 3.1% last month.

The trading range with boundaries of 1.0875 and 1.1000 remains. Now the price is above the middle of the range and may continue to rise.

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BTC/USD price and the “Three Black Crows” pattern
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On January 11, the highly publicized Bitcoin ETF began trading after it was officially approved by the SEC. On this day, the price of Bitcoin exceeded USD 48,800, as shown by the chart. Bloomberg writes that new US spot funds achieved net inflows of USD 819 million in the first two days of trading.

However, from the high on January 11, a dizzying fall began, and already at the low on January 12, Bitcoin was worth less than USD 41,800. This dynamic may illustrate the “buy the rumors, sell the facts” strategy, which we wrote about on January 3 when predicting the price of Bitcoin in 2024.

News of the ETF's approval sent the ATR above 1,100 on the 4-hour chart, the last time it did so was in mid-June 2022. The market was overly active, and what is important is that three bearish candles (marked with an arrow) summed up this activity. They can be interpreted as the three black crows pattern.

According to statistics from Tim Bulkowski, this pattern works in 78% of cases and means a trend change from bullish to bearish. According to CandleScanner statistics for 20 years, collected on the S&P 500 index market, the pattern turned out to be false only in 18.6% of cases out of 543 occurrences.

Does this mean that the statistics will work on the Bitcoin price chart?

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EUR/USD, GBP/USD, and USD/JPY Analysis: US Dollar Weakens after Inflation Data
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The US dollar weakened after data showed US consumer price inflation in December exceeded economists' expectations. This has raised some doubts that the Fed will cut rates. US consumer prices rose in December as inflation continued its upward trend, rising 0.3% for the month and 3.4% year-on-year, versus economists' forecasts of 0.2% and 3.2%, respectively. Cleveland Fed President Loretta Mester said it would be too early to cut rates in March, while Richmond Fed Chairman Tom Barkin said rising inflation was too narrowly focused on goods. American monetary authorities will probably be in no hurry to launch a cycle of lower borrowing costs this year. Against this background, expectations regarding a March adjustment to the value have been revised, but in general such a scenario is still considered possible. Today at 15:30 (GMT+2), the focus of investors' attention will be on statistics from the United States on manufacturing inflation: the producer price index is expected to increase in December from 0.9% to 1.3% in annual terms and from 0.0% to 0.1% per month.

EUR/USD
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Quotes of the EUR/USD pair are holding near the 1.0975 mark, preparing to end the week with slight upward dynamics. According to EUR/USD technical analysis, immediate resistance can be seen at 1.1000, a break higher could trigger a move towards 1.1045. On the downside, immediate support is seen at 1.0958, a break below could take the pair towards 1.0910.

Trading participants are closely monitoring comments from ECB representatives. Board member of the regulator Isabel Schnabel said yesterday that indicators of economic sentiment in the region have probably reached minimum values, while the short-term economic prospects remain weak. The official also noted that the labour market remains resistant to changes made by the regulator, but a return of inflation to the target level of 2.0% in 2025 is still possible. During the day, data on consumer price indices will be published in Spain and France, which may remain at 3.1% and 4.1%, respectively.

The same trading range with boundaries of 1.0875 and 1.1000 remains. Now the price has moved away from the upper limit of the range and may continue to decline.

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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Inflation Data Changes Market Sentiment
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US CPI data published yesterday did not meet expectations. Analysts predicted 3.2%, but in fact it turned out = 3.4% (value a month ago = 3.1%). This hardly means a reversal of the large-scale trend toward weakening inflation (a year ago CPI = 6.5%), but to some extent investors have become wary. According to FedWatch, expectations for a rate cut by the Federal Reserve in March dropped to about 65% (before the news was about 70%).

The publication of the news caused a noticeable surge in volatility in financial markets. Let's pay attention to the S&P 500 chart. The index price is within an uptrend (as shown by the blue channel), however, this trend may change:

→ Tops A-B-C form divergence with the RSI indicator — a sign of weakening demand near the upper border of the channel.
→ Yesterday, the price only slightly and briefly exceeded the A-B-C formation, forming top D. That is, a false bullish breakout was formed. This type of price behavior at top D confirms the activity of the bears at the level of 4,800.

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Market Analysis: AUD/USD and NZD/USD Eye Key Upside Break
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AUD/USD is moving higher and might rally if it clears 0.6725. NZD/USD is also rising and could extend its increase above the 0.6255 resistance zone.

Important Takeaways for AUD USD and NZD USD Analysis Today

• The Aussie Dollar started a fresh increase above the 0.6680 and 0.6695 levels against the US Dollar.
  
• There is a key bearish trend line forming with resistance near 0.6715 on the hourly chart of AUD/USD at FXOpen.
  
• NZD/USD is showing positive signs above the 0.6220 support.
  
• There is a major bearish trend line forming with resistance near 0.6255 on the hourly chart of NZD/USD at FXOpen.
  

AUD/USD Technical Analysis
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On the hourly chart of AUD/USD at FXOpen, the pair started a fresh increase from the 0.6650 support. The Aussie Dollar was able to clear the 0.6680 resistance to move into a positive zone against the US Dollar.

The bulls pushed the pair above the 50% Fib retracement level of the downward move from the 0.6725 swing high to the 0.6647 low. There was a close above the 0.6695 resistance and the 50-hour simple moving average.

Finally, the pair spiked above the 76.4% Fib retracement level of the downward move from the 0.6725 swing high to the 0.6647 low. On the upside, the AUD/USD chart indicates that the pair is now facing resistance near a key bearish trend line at 0.6715.

The first major resistance might be 0.6725. An upside break above the 0.6725 resistance might send the pair further higher. The next major resistance is near the 0.6750 level. Any more gains could clear the path for a move toward the 0.6820 resistance zone.

If not, the pair might correct lower below the 50-hour simple moving average at 0.6695. The next support could be 0.6680. If there is a downside break below the 0.6680 support, the pair could extend its decline toward the 0.6650 zone. Any more losses might signal a move toward 0.6600.

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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

USD/JPY, GBP/USD, and EUR/USD Analysis: The Yen Resumes Its Decline, the Euro and the Pound Test Important Levels
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Towards the end of the current five-day trading period, in most currency pairs we are seeing a continuation of the sluggish flat movement. Thus, the pound/US dollar pair is trading near last week’s highs at 1.2770, the euro/US dollar pair is trying to get closer to the psychological level of 1.1000, and commodity currencies are also caught in narrow flat corridors. But the US dollar/yen pair paints a slightly different picture. After a downward pullback last Friday, buyers of the pair found support at 143.40 and strengthened the price by more than 100 points in just one day. We will see whether it will be possible to maintain the upward mood for the pair today after the publication of inflation data in the United States.

USD/JPY
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Negative fundamental data from Japan published this week contributed to the resumption of the downward movement in the yen. Thus, the household expenditure index in November was at -2.9% against the forecast of -2.3%. The total income of employees in the form of wages in Japan also decreased over the same period: 0.2% versus 1.5%. As a result of such data, the price almost tested last week’s high at 146.00. If buyers manage to strengthen the pair above the mentioned level, the price may continue to rise in the direction of 147.00-148.00. A downward breakdown of the range 144.00-143.00 may contribute to a decline to the December extremes at 140.80-140.30.

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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Finally! The SEC Approves all 11 Applications for Bitcoin ETFs
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The following ETFs can start operating today:

• Blackrock's iShares Bitcoin Trust (IBIT)
  
• ARK 21Shares Bitcoin ETF (ARKB)
  
• WisdomTree Bitcoin Fund (BTCW)
  
• Invesco Galaxy Bitcoin ETF (BTCO)
  
• Bitwise Bitcoin ETF (BITB)
  
• VanEck Bitcoin Trust (HODL)
  
• Franklin Bitcoin ETF (EZBC)
  
• Fidelity Wise Origin Bitcoin Trust (FBTC)
  
• Valkyrie Bitcoin Fund (BRRR)
  
• Grayscale Bitcoin Trust (GBTC)
  
• Hashdex Bitcoin ETF (DEFI)
  

Despite the regulatory approval of the first spot Bitcoin ETFs in US history, the head of the US Securities and Exchange Commission (SEC) Gary Gensler has not changed his critical attitude towards cryptocurrencies. Thus, the regulator sees signs of illegally issued securities in many cryptocurrencies that operate on the Proof-of-Stake (PoS) algorithm.

According to Gensler, the regulator was forced to approve the applications due to “changed circumstances.” This is likely a reference to the recent litigation where Grayscale filed a request with the Commission to transform its Bitcoin fund into a spot ETF. The judge then concluded that the regulator had wrongfully rejected the company's application.

Gensler also warned investors about the numerous risks associated with Bitcoin.

Meanwhile:
→ Funds whose applications have been approved are reducing fees one after another, trying to win the competition for investors.
→ Bank of England (BOE) Governor Andrew Bailey, speaking before the Treasury Committee of the United Kingdom Parliament, called Bitcoin ineffective.
→ Cryptocurrency exchange apps have become unavailable in India due to the introduction of stricter legislation governing cryptocurrencies.

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Nikkei 225 Sets 21st Century High
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As the chart shows, this morning the Nikkei 225 price exceeded 35,700, its highest level in decades.

The Nikkei 225 index reached its all-time high on December 30, 1989, at 38,957.44 points. This was against the backdrop of Japan's economic boom, which began in the 1980s and continued until the early 1990s.

Nikkei 225 growth is supported by lower inflation:
→ in Japan: the latest data showed an annual inflation rate of 2.8% — lower than a series of more than 10 previous values, all of which were above 3%. This reduces fears that the Bank of Japan will raise interest rates and limit its current economic stimulus policies.
→ In the USA. Today, we remind you that at 16:30 GMT+3 inflation data in the USA will be published. It is also expected to show a slowdown in inflation. Therefore, market participants believe in a reduction in Fed rates, which can give impetus to the development of companies.

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EUR/USD, GBP/USD, USD/JPY Analysis: Dollar Strengthens ahead of Inflation Data Release
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Yesterday, the US dollar rose against all major currencies, as it is unclear when the Fed will lower rates. The main economic data this week will be the December consumer price inflation report, which is scheduled to be released on Thursday. Expectations call for headline inflation to increase 0.2% month-on-month, reaching 3.2% year-on-year growth. If data confirms that inflation continues to slow, it could increase expectations of a rate cut in March.

A New York Fed survey released Monday showed consumers see lower inflation and slower growth in household income and spending over the next few years. Last week's better-than-expected employment figures, coupled with the latest Fed minutes that expressed ambiguity about the timing of rate cuts, have dampened expectations of an imminent US policy easing. The dollar is supported by macroeconomic statistics from the United States. The National Federation of Independent Business (NFIB) business optimism index rose from 90.6 points to 91.9 points in December, while analysts expected 90.7 points, and the IBD/TIPP economic optimism index rose from 40.0 points in January to 44.7 points with a forecast of 42.0 points.

EUR/USD
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The EUR/USD pair shows mixed dynamics, remaining close to 1.0930. According to EUR/USD technical analysis, immediate resistance can be seen at 1.1000, a break higher could trigger a move towards 1.1045. On the downside, immediate support is seen at 1.0910, a break below could take the pair towards 1.0875.

Yesterday, the positions of the single currency came under pressure, but traders expect the emergence of new drivers for making trading decisions. Investors are concerned about the development of the crisis in the EU and, in particular, in Germany, which could be aggravated by large-scale protests by farmers across the country. In turn, German data on the dynamics of industrial production in November showed a decrease of 0.7% after -0.3% in the previous month, while analysts expected moderate growth of 0.25%, and in annual terms the decline accelerated from -3.4% to -4.8%.

The same trading range with boundaries of 1.0875 and 1.1000 remains. Now the price is in the middle of the range and may continue to rise.

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S&P 500 Rebounds Despite Boeing's Commercial Disaster
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Stock markets in the United States have been very interesting over recent years. However, it has not just been a case of following the volatile tech stocks on the NASDAQ, as the more traditional companies that are included in the S&P 500 can also make waves.

This week, the S&P 500 index has experienced a very sudden change in fortunes, showing a noticeably different pattern compared to its very strong growth that has been consistent since November 2023.

At FXOpen, the S&P 500 index stood at 4,119 points on October 27 before beginning a substantial rally in which it increased over several weeks before touching 4,780 points on January 1 this year.

Such a strong rally showed consistent growth among the most prestigious large-cap companies on the American stock markets, demonstrating remarkable progress in the growth of the US economy overall; however, whilst the country itself may be back on track, there is one extremely high-profile aspect that has begun to dampen the progress made since November with regard to the S&P 500 index.

This week, in the aftermath of the incident, which took place in Portland, Oregon, in which a Boeing 737-9 MAX aircraft had made an emergency landing after a section of its fuselage disconnected from the aircraft mid-flight, there have been severe repercussions for its manufacturer.

Seattle-based Boeing Company, which is one of the world's largest civilian aircraft manufacturers, is a key component of the S&P 500 index, and its share price has been affected by this incident, which builds further on a previous issue in which a similar model of aircraft, a Boeing 737-8 MAX operated by Ethiopian Airlines crashed due to an innate design fault in 2019 killing 157 people with an ongoing litigation having cost Boeing approximately $20 billion so far.

This latest incident has caused Boeing stock to dive, and this week, the S&P 500's previously unstoppable rally ended, taking the value down to 4,694 on January 4 at FXOpen.

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Inflation in Australia Continues To Decline. AUD/USD Tests Important Support
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Data today from the Australian Bureau of Statistics on Wednesday showed the monthly consumer price index (CPI) rose 4.3% year-on-year in November, the slowest pace since January 2022. Value a month earlier = 4.9%. Market forecasts = 4.4%.

This strengthened market expectations that interest rates would not have to rise further. Although the head of the Reserve Bank of Australia, Michele Bullock, warned of the risks of rising price pressures caused by domestic demand, for example, due to rising prices for rental housing.

Against the backdrop of the publication of news about inflation in Australia, no strong surges were noticed in the AUD/USD market. Perhaps this was due to the fact that there were no surprises.

Meanwhile, the 4-hour chart shows that the AUD/USD rate is nearing important support, which is formed by the lower line of the trend channel (shown in blue), within which the price has been moving since last fall.

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Market Analysis: EUR/USD Revisits Support While USD/CHF Aims Higher
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EUR/USD started a fresh decline below the 1.0980 support. USD/CHF is rising and might aim a move toward the 0.8620 resistance.

Important Takeaways for EUR/USD and USD/CHF Analysis Today

• The Euro struggled to clear the 1.1000 resistance and declined against the US Dollar.
  
• There is a major bearish trend line forming with resistance near 1.0945 on the hourly chart of EUR/USD at FXOpen.
  
• USD/CHF is gaining pace above the 0.8500 resistance zone.
  
• There is a key bearish trend line forming with resistance near 0.8530 on the hourly chart at FXOpen.
  

EUR/USD Technical Analysis
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On the hourly chart of EUR/USD at FXOpen, the pair failed to clear the 1.1000 resistance. The Euro started a fresh decline below the 1.0980 support against the US Dollar.

There was a move below the 50-hour simple moving average and 1.0945. The bears were able to push the pair below the 1.0920 pivot level. The pair traded as low as 1.0910 and is currently consolidating losses.

Immediate resistance on the upside is near the 50% Fib retracement level of the downward move from the 1.0978 swing high to the 1.0610 low. There is also a major bearish trend line forming with resistance near 1.0945 and the 50-hour simple moving average.

The next major resistance is near the 1.0980 zone. An upside break above the 1.0980 level might send the pair toward the 1.1020 resistance or the 1.618 Fib extension level of the downward move from the 1.0978 swing high to the 1.0610 low. Any more gains might open the doors for a move toward the 1.1050 level.

On the downside, immediate support on the EUR/USD chart is seen near 1.0910. The next major support is near the 1.0890 level. A downside break below the 1.0890 support could send the pair toward the 1.0850 level.

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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

USD/CAD, GBP/USD, and EUR/USD Analysis: Major Currency Pairs in Consolidation Phase
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Despite higher than expected NFP figures, published last week, the US dollar suffered a downward pullback. Thus, the pound/US dollar pair retested support at 1.2600 and sharply rose above 1.2700, the US dollar/loonie pair fell to 1.3290, and the euro/US dollar pair managed to briefly return to 1.1000. At the same time, it was not possible to develop a full-fledged downward movement, and since the beginning of the current five-day trading period, the main currency pairs continue to trade in narrow flat corridors.

USD/CAD
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On the daily chart of USD/CAD, the upward pullback, which we observed on December 27, was interrupted on Friday by a sharp rebound from the resistance in the form of intertwined alligator lines. The price retreated from 1.3400, but managed to remain above 1.3300, which may increase the likelihood of a resumption of upward movement. Cancellation of the upward scenario can be considered after a confident consolidation below 1.3270.

Today at 16:30 GMT+3, it is worth paying attention to the publication of data on the trade balance and permits for the construction of new houses in Canada for December. Tomorrow at 18:30 GMT+3, data on crude oil reserves in the United States will be released.

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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

British Companies Bullish on Economic Strength, but Pound Dips
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The British economy, despite being free from the high-profile catastrophes during the past year that dogged progress in the United States, has been the subject of trepidation from corporate giants and investors alike recently.

There has been no such series of bank collapses or near-insolvent government coffers on Britain's shores. In contrast, last year, there was a host of large-scale fiscal disasters in the United States, including the demise of some long-established banks and a need for the US government to raise the debt ceiling to be able to borrow more money to stop the country becoming insolvent, despite its already very high national debt.

The anomaly amid these two yardstick economies is that during the course of last year, the US dollar remained very buoyant against all other majors despite these weaknesses, which could possibly be down to a highly productive workforce and inflation that became well under control before it did in Europe and the United Kingdom.

Today, a potential beacon of light for the British economy has emerged in the form of a report by PriceWaterhouseCoopers, which indicates that Britain may be well positioned to increase its standing as a global hub for manufacturing.

Such a report may come as a surprise to many, as Britain, along with many other Western countries with high-cost bases, is not often viewed as a nation with attractive entry points for goods manufacturers due to high salaries, energy costs, worker shortages, high taxation, logistical issues and more recently, the added cost and bureaucracy associated with Brexit.

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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

The Swiss National Bank Suffered Losses of 3 Billion Francs in 2023
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The Swiss National Bank (SNB) reported an annual loss of 3 billion Swiss francs (USD 3.54 billion) in 2023 and said it would not make payments to Switzerland's central or local government or pay dividends to investors.

The loss is believed to have occurred as a result of interest rate hikes aimed at fighting inflation.

Although in Switzerland, perhaps, inflation is at the lowest level: according to yesterday's Core Price Index data, the actual value is = 0.0% (expected = 0.1%, a year ago = -0.2%, the highest actual value in 2023 was = +0.7 %). However, the SNB raised the rate to 1.75% twice in 2023, and this led to it making more payments to deposit account holders.

Note that the loss for 2023 is much less than the record minus 133 billion for 2022. Reuters writes that the losses will not affect the bank's current monetary policy, and interest rates could be cut during 2024.

On November 2, we wrote that the franc could continue to strengthen. Since then, USD/CHF has fallen about 6%, setting its 2023 low on December 28 at 0.83327.

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EUR/USD, GBP/USD, and USD/JPY Analysis: Dollar Loses Gains Due to US Services Data
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The dollar initially rose on Friday but then retreated after data showed the US services sector fell sharply in December, erasing gains made after a report showed stronger-than-expected nonfarm payrolls last month. Earlier in the session, the dollar jumped after data showed the US economy added 216,000 new jobs in December, topping the consensus forecast of 170,000. The Institute for Supply Management (ISM) said its non-manufacturing index fell to 50.6 last month, the lowest since May, down from 52.7 in November. The service sector makes up more than two-thirds of the economy. Economists polled by Reuters had forecast the index would change little to 52.6.

EUR/USD
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The EUR/USD pair is trading around the 1.0940 level. According to EUR/USD technical analysis, immediate resistance can be seen at 1.1000, a break higher could trigger a move towards 1.1045. On the downside, immediate support is seen at 1.0918, a break below could take the pair towards 1.0875. The eurozone reported lower-than-expected consumer price index data (2.9% vs. 3.0%).

Over the past week, a trading range has formed with boundaries of 1.0875 and 1.1000. Now the price is in the middle of the range and may continue to rise.

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JPM Stock Hits All-time High
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This week the reporting season begins — company results for the 4th quarter will certainly become one of the most important drivers of stock index prices, along with the publication of news about inflation, the labor market, and statements from the Federal Reserve.

Large banks will traditionally be among the first to report: JP Morgan, Bank of America, Wells Fargo, Citi. The banking sector looks frankly strong at the beginning of 2024. While the S&P-500 is down 1% in the first week, the XLF financial sector fund is holding near the year's opening price.

According to MarketWatch, bank stocks are becoming increasingly popular amid expectations of a positive yield curve in the second half of 2024, and analysts have set “buy” ratings on shares of Goldman Sachs, Morgan Stanley and Wells Fargo (WFC).

It should be noted that shares of JP Morgan bank set a historical record. The previous high set on October 25, 2021 was USD 172.75 per share. At its peak last Friday, the price reached USD 173.19 per share.

The growth of JPM shares is facilitated by the dividend policy:
→ January 2024: USD 1.05 per share;
→ January 2023: USD 1.00 per share;
→ January 2022: USD 1.00 per share;
→ January 2021: USD 0.90 per share;
→ January 2020: USD 0.90 per share.

JPM data will be published on Friday. Will the price be able to maintain its highs?

There are some concerns.

From a fundamental point of view, in the current economic environment, with inflation remaining above target and interest rates at high levels, the results for the 4th quarter may disappoint.

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High Hopes for FTSE 100 Deflate After First Week of 2024
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At the end of last year, there were a number of interesting speculations regarding the trajectory that the stock of London's most prestigious 100 companies would take in the new year.

The FTSE 100 index had been increasing in value very steadily during the final two weeks of 2023, creating the potential notion that it may venture toward the 8,000 mark once again, revisiting the milestone which it passed in February last year for the first time in history.

One full week of trading has now passed since 2024 began, and the upward direction that was prevailing at the end of December has not continued.

Instead, a steady decrease in value has materialised, with the FTSE 100 index having reduced in value over the five-day moving average from 7,764 on January 2 to 7,680 on the opening bell this morning at the London Stock Exchange at FXOpen. The FTSE 100 had dipped as low as 7,654 on Friday afternoon last week.

Hopes were high for a bumper start to 2024 for the London Stock Exchange's FTSE 100 index, with many analysts having made their predictions at the end of 2023 that it would have a better year in 2024 than it did in 2023.

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The Dollar On the Rise ahead of the US Non-farm Payrolls Report
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The American currency is receiving support after the publication of the meeting minutes of the Federal Open Market Committee, according to which officials may begin a cycle of interest rate cuts by the end of this year, while pointing to continued uncertainty in the economy. Trading participants are in no hurry to open new positions ahead of today's publication of the December report on the US labour market. Forecasts assume a slowdown in the growth rate of new jobs outside the agricultural sector from 199.0k to 170.0k. At the same time, the unemployment rate is expected to adjust from 3.7% to 3.8%, and the average hourly wage, from 4.0% to 3.9%. At the moment, investors are evaluating a report from Automatic Data Processing (ADP), which reflected an increase in employment in the private sector from 101.0k to 164.0k, while analysts expected 115.0k. In turn, the number of initial applications for unemployment benefits for the week of December 29 decreased from 220.0k to 202.0k, with a forecast of 216.0k.

EUR/USD
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According to EUR/USD technical analysis, the pair shows mixed trading dynamics, consolidating near the 1.0940 mark. Immediate resistance can be seen at 1.0989, a break higher could trigger a move towards 1.1000. On the downside, immediate support is seen at 1.0911, a break below could take the pair towards 1.0839.

Activity in the market remains quite low, as investors are in no hurry to open new positions ahead of the publication of European statistics on consumer inflation and the December report on the US labour market. Forecasts suggest a moderate rise in the eurozone consumer price index in December from 2.4% to 3.0%, which could lead to the ECB taking a pause before the expected launch of a cycle of interest rate cuts this year. Yesterday, inflation statistics were published in Germany. In monthly terms, the indicator increased by 0.1% after declining by 0.4% in November, and in annual terms it accelerated from 3.2% to 3.7%, which turned out to be slightly worse than market expectations at 3.8%. The single currency was also moderately supported by statistics on business activity: the composite index in the eurozone manufacturing sector in December rose from 47.0 points to 47.6 points, and in the services sector from 48.1 points to 48.8 points, beating neutral forecasts.

Based on the lows of two days, a new downward channel has formed. Now the price is in the middle of the channel and may continue to decline after approaching the upper limit.

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USD/JPY: The Price Reaches Resistance at 145 Yen per US Dollar
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As of Friday morning, the situation on the USD/JPY market deserves attention:

→ the US dollar is on course to demonstrate its strongest week since July 2023. The media writes that markets are adjusting expectations regarding the easing of monetary policy by the Fed.

→ The yen fell about 3% against the US dollar in the first week of the year, which could be its weakest weekly performance since August 2022.

The USD/JPY chart shows that:

→ the price moves within the descending channel (shown in red). Growth at the beginning of the year expanded its boundaries along the principle of a parallel channel.

→ the median line has been broken by the bulls. The price action around 142 shows increased demand. The price could not consolidate below this level in December, serving as a powerful support for ending panic on December 7 and 14-15. Also, demand forces did not allow the price to reach the lower border of the channel on December 28.

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Market Analysis: Gold Price Corrects Gains While Crude Oil Price Aims Higher
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Gold price is correcting lower from the $2,088 resistance. Crude oil price is rising and it could climb further higher toward the $75.90 resistance.

Important Takeaways for Gold and Oil Prices Analysis Today

• Gold price failed to clear the $2,088 resistance and corrected lower against the US Dollar.
  
• A key contracting triangle is forming with support at $2,042 on the hourly chart of gold at FXOpen.
  
• Crude oil prices are moving higher above the $71.00 resistance zone.
  
• There is a key bullish trend line forming with support near $72.60 on the hourly chart of XTI/USD at FXOpen.
  

Gold Price Technical Analysis
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On the hourly chart of Gold at FXOpen, the price was able to climb above the $2,050 resistance. The price even broke the $2,078 level before the bears appeared.

The price traded as high as $2,088 before there was a downside correction. There was a move below the $2,060 pivot zone. The price settled below the 50-hour simple moving average and RSI dipped below 50. Finally, it tested the $2,030 zone.

The price is now attempting a recovery wave above the $2,040 level. It climbed above the 23.6% Fib retracement level of the downward move from the $2,078 swing high to the $2,030 low.

If the bulls remain active, the price could start a fresh increase. Immediate resistance is near the 50-hour simple moving average at $2,046. The next major resistance is near the 50% Fib retracement level of the downward move from the $2,078 swing high to the $2,030 low at $2,055.

An upside break above the $2,055 resistance could send Gold price toward $2,078. Any more gains may perhaps set the pace for an increase toward the $2,088 level.

Initial support on the downside is near the $2,042 level. There is also a key contracting triangle forming with support at $2,042. The first major support is $2,030. If there is a downside break below $2,030, the price might decline further. In the stated case, the price might drop toward $2,010.

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5 Stocks To Consider in January 2024
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A new year means a new start. Market optimism appears to be the order of the day as the beginning of 2024 leads a foray into the new era in which the slow recovery of Western economies signalled in 2023.

With tech stocks back in the limelight over the course of recent months, will market conditions favour these even more during the year ahead?

Given that there is a wide range of speculations and expectations relating to a potential change in central bank policy, which would see a move away from the ultra-conservative methods being used on both sides of the Atlantic that have been in place for a long period, with increases in interest rates continuing despite the backdrop of reducing inflation, it may be worth considering that dynamic, modern high-tech companies whose stocks are listed on North American stock exchanges are very responsive to such changes.

In circumstances where monthly commitments are high, a very different corporate policy is often considered at times when the cost of meeting such commitments is considerably lower, allowing companies to reinvest in growth.

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European Currencies Find a Short-term Bottom after Publication of Fed Minutes
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The beginning of this year turned out to be quite successful for the American currency. In just a few trading sessions, the euro/US dollar pair lost about 200 points, the pound/US dollar pair dropped to 1.2600, and the US dollar/yen managed to strengthen by more than 300 points. However, yesterday the upward correction on the greenback slowed down slightly, which allowed the major currencies to find short-term support.

GBP/USD

The pound/US dollar currency pair, after testing 1.2800, sharply rolled back. Weak volatility during the pre-holiday days contributed to increased sales of the pound, and yesterday the price fell to 1.2600. But by the end of the American session, the pair sharply rolled back up to 1.2670.

Today is an important fundamental day for the pair. At 12:30 GMT+3, the UK composite index for December will be published. The index of business activity in the services sector and the volume of mortgage lending for November will also be released. Analysts expect growth in indicators, which may contribute to the continued strengthening of the pair.

On the daily GBP/USD chart, we see the bearish reversal bar from December 28. At the moment, the pair's decline has slowed down at the intertwined alligator lines. If the level of 1.2000 is broken, we may expect a resumption of the decline to 1.2500.

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Analysts Downgrade AAPL Shares
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According to Yahoo Finance, Barclays analysts downgraded AAPL shares to “underweight” and lowered their price forecast: they expect the share price to drop to USD 160 (although AAPL traded above USD 184 yesterday).

Analysts justified their decision by their expectations of a decrease in demand for new iPhone models. “Our checks remain negative on volumes and mix for iPhone 15, and we see no features or upgrades that are likely to make the iPhone 16 more compelling.”

The news caused AAPL's share price to fall 3.6% on Tuesday, its biggest one-day percentage drop since September, and the decline wiped out more than USD 107 billion in market value. Concerns are growing due to:

→ growing competition from companies such as Huawei Technologies Co;

→ strict measures by the Chinese government against foreign-made devices.

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Traders Adjust Their Expectations for Fed Action
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From the beginning of November to the end of December 2023, the dollar index futures price fell by approximately 5.5%, according to the CME exchange. The weakening of the USD was caused by the sentiment of traders who expected the Fed to cut interest rates in March. As a result of the sentiment that prevailed at the end of 2023, stock indices, gold (setting a historical maximum on December 4) and cryptocurrencies rose.

However, the start of 2024 indicated a sharp change in sentiment, with the dollar index futures price rising more than 1% during the January 3-4 sessions.

This can be interpreted as:

→ during the pre-holiday period, there was a certain emotional component that helped to look into the future with optimism;

→ after the end of the holidays, market participants adjusted their expectations regarding the easing of the Fed's actions.

Data released yesterday showed that there is no clear indication that the Fed may start cutting rates, as its members still see the need for policy to remain restrictive for some time.

That is, in the first days of 2024, there was a correction of bullish sentiment at the end of 2023. In the cryptocurrency market, which is characterised by a high degree of margin (opening positions with borrowed funds), the correction turned into an avalanche of sales — the BTC/USD rate dropped rapidly to the level of $41,000, forming a false bullish breakout of the consolidation zone at the end of 2023, which we wrote about yesterday.

We also note the decline in the NASDAQ technology stock index, which, according to Bloomberg, showed the worst start to the year since 2001 (the time of the dot-com crash).

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EUR/USD, GBP/USD, and USD/JPY Market Analysis
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Today, investors are focusing on the December minutes of the US Federal Reserve meeting, which will help clarify the regulator’s plans for the near future: more than 70.0% of analysts expect that officials may resume the program to reduce borrowing costs in March. Also during the day, December data on the index of business activity in the manufacturing sector from the Institute for Supply Management (ISM) will be published: a moderate increase in the indicator is expected from 46.7 points to 47.1 points. It is worth noting that a similar index from S&P Global presented the day before did not meet analysts’ expectations, falling from 48.2 points to 47.9 points with neutral forecasts.

EUR/USD
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According to EUR/USD technical analysis, the EUR/USD pair is showing slight growth, correcting after a rather sharp decline the day before, as a result of which the local lows of December 20, 2023, were updated. The single currency is trading near the 1.0960 mark, and market participants expect new drivers to appear in the market. Immediate resistance can be seen at 1.1000, a break higher could trigger a move towards 1.1047. On the downside, immediate support is seen at 1.0947, a break below could take the pair towards 1.0869.

The EU will present December inflation statistics within a week, which may affect the ECB's further monetary policy. The German consumer price index may rise by 0.1% in monthly terms after -0.4 and in annual terms from 3.2% to 3.8%. Final inflation data in the eurozone will be published on Friday. The annual rate is expected to accelerate from 2.4% to 3.0%. In addition, investors will evaluate the December report on the American labour market, which may also have an impact on future decisions of the US Federal Reserve.

Based on the lows of two days, a new downward channel has formed. Now the price is in the middle of the channel and may continue to decline after approaching the upper limit.

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2024 Is All About Interest Rate Policy, but Who Is Right?
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There are high hopes for the year ahead, especially given that 2023 was mostly a period in which rebuilding Western economies was steady and relatively progressive within the financial markets.

Britain slowly moved forward, away from the cost of living crisis, double figure inflation and government-enforced lockdowns that dogged the early part of this decade, with 2023 having been a gradual move upwards for the British economy, in which inflation became more palatable, and in which it avoided any of the toxicity from some of the high profile bank demises in the United States during last year.

Similarly, the United States economy has been getting itself very much back on track, with inflation now well under control and productivity reasonably high. Despite the collapse of some major banks, which brought memories of the 2008/2009 banking catastrophe back to the forefront of many minds, the US continued steadily and calmly with a strong Dollar and good overall figures.

Even the tech stocks are now back to a good level of trading volatility and out of the doldrums, leading US investors to be back to positivity.

There has been a lot of discussion and speculation regarding the potential monetary policy on both sides of the Atlantic for 2024. Will the central bankers begin to stop increasing interest rates? Will they pursue quantitative easing policies?

One school of thought centres around quantitative easing, which is a monetary policy strategy used by central banks in which they purchase securities in an attempt to reduce interest rates, increase the supply of money and drive more lending to consumers and businesses.

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Bitcoin Price Starts the Year with Bullish Sentiment
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The first Bitcoin block, also known as the genesis block, was mined on January 3, 2009 at 18:15:05 UTC. 15 years have passed and the value of Bitcoin is in the tens of thousands of US dollars.

In the first days of 2023, bitcoin was worth about $16,600 — and, as it turned out, this was the minimum. After all, then the BTC/USD rate went up and by the end of 2023 reached $44,000. The change was more than +150%!

On January 3, 2024, the price was already above $45,000, giving hope to the bulls that 2024 will be no less successful. If in the coming 2024 BTC/USD repeats the progress of last year, this will mean exceeding the psychological mark of USD 100,000 per coin!

What will influence the price of Bitcoin in the first half of the year?

→ Expected approval of applications for BTC ETF by the SEC regulator. On the one hand, approval will allow a wide range of people to simply invest in Bitcoin, which should increase demand. On the other hand, waiting for approval takes too long. And if it happens, it is possible that a price reduction may occur according to the “buy rumours, sell facts” principle.

→ Approximately, halving will occur in April. This will happen after the 210,000th block is mined. After the halving, miners' block rewards will be reduced from 6.25 BTC to 3.125 BTC. It is believed that this should reduce the supply of coins on the market —  accordingly, the price of BTC/USD may rise (and history suggests this).

→ Fed rate cut. Easing monetary policy can serve as a driver for the growth of investment in risky assets, which is Bitcoin.

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The BTC/USD daily chart shows that:

→ the price of Bitcoin is within the ascending channel;

→ the price broke through the resistance level of $44,400 per coin.

In this case, a comparison with the recent breakdown of the level of 38,000 is appropriate. If the price acts in the same bullish manner, it may consolidate above 44,400, without even testing this former resistance level.

If the demand for Bitcoin does not exhaust itself, the price may reach the upper boundary of the channel and drift towards the psychological mark of $50k. A return below the $44,000 level will mean a big setback for the bulls and will give reason to consider bearish scenarios, up to a breakdown of the current channel.

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Market Analysis: GBP/USD Retreats From Highs, USD/CAD Grinds Higher
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GBP/USD declined below the 1.2715 support zone. USD/CAD is rising and might aim for more gains above the 1.3330 resistance.

Important Takeaways for GBP/USD and USD/CAD Analysis Today

• The British Pound started a fresh decline below the 1.2715 support zone.
  
• There is a key bearish trend line forming with resistance near 1.2680 on the hourly chart of GBP/USD at FXOpen.
  
• USD/CAD is showing positive signs above the 1.3260 support zone.
  
• There was a break above a major bearish trend line with resistance near 1.3260 on the hourly chart at FXOpen.
  

GBP/USD Technical Analysis
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On the hourly chart of GBP/USD at FXOpen, the pair started a fresh decline from the 1.2820 zone. The British Pound traded below the 1.2715 support to move further into a bearish zone against the US Dollar.

The pair even traded below 1.2680 and the 50-hour simple moving average. Finally, the bulls appeared near the 1.2610 level. A low was formed near 1.2610 and the pair is now attempting a recovery wave.

Immediate resistance on the upside is near the 23.6% Fib retracement level of the downward move from the 1.2827 swing high to the 1.2610 low at 1.2660. The first major resistance is near a key bearish trend line at 1.2680 or the 50-hour simple moving average.

A close above the 1.2680 resistance might spark a steady upward move. The next major resistance is near the 50% Fib retracement level of the downward move from the 1.2827 swing high to the 1.2610 low at 1.2715. Any more gains could lead the pair toward the 1.2820 resistance in the near term.

Initial support sits near 1.2610. The next major support is at 1.2565, below which there is a risk of another sharp decline. In the stated case, the pair could drop towards 1.2500.

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The Dollar Stopped Falling
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The US dollar is trying to win back losses, trading at 100.800 in USDX, however, key statistics on the labour market were negative: the number of initial applications for unemployment benefits amounted to 218.0k, much higher than 206.0k a week earlier and the expected 210.0k, as a result of which the total number of citizens receiving government assistance increased from 1.861 million to 1.875 million, putting pressure on the US currency. Market participants expect an adjustment in monetary policy from the US Federal Reserve, and also hope for a threefold reduction in borrowing costs next year. According to a CNBC survey of 300 leading investors, most expect the transition to dovish rates to begin in the second half of 2024, with some predicting it will begin in March.

EUR/USD
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The EUR/USD pair is trading in the main range of 1.1083-1.1060, with the price trying to resume growth after a correction the day before, when it retreated from six-month highs at 1.1138. Immediate resistance can be seen at 1.1145, a break higher could trigger a rise towards 1.1177. On the downside, immediate support is seen at 1.1066, a break below could take the pair towards 1.1000.

The euro quotes were put under pressure by the continuing uncertainty regarding further actions (by the ECB) in the field of monetary policy. Previously, it was assumed that the European regulator, like the US Federal Reserve, would begin a cycle of easing monetary policy, but recent comments by ECB board member Robert Holtzman have somewhat changed these forecasts. The day before, in an interview with Bloomberg, the official said that it was too early to talk about the beginning of a reduction in borrowing costs in the region, while admitting that the measures taken by the department led to a noticeable weakening of inflation. The potential for the EUR/USD pair to resume its upward dynamics after the Christmas holidays remains.

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USD/JPY Analysis: Outlook for 2024
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The Japanese yen has been one of the worst performing currencies over the past couple of years. The situation could improve in 2024, writes WSJ.

The yen has lost about 20% against the dollar since the end of 2021, underperforming other major currencies. The reason is that Japan's central bank kept interest rates ultra-low while most of its peers raised them aggressively. This was possible because it did not grow so rapidly in Japan. Japan's core inflation rate, which does not include fresh produce, was 2.5% in November. Although this is already above its 2% inflation target, the Bank of Japan is reluctant to raise interest rates too quickly for fear of a hit to the economy.

But the situation may change in 2024. The central bank has already made several changes to its “yield curve control” policy in the bond market. And the yen has risen about 7% against the dollar since mid-November, partly because traders expect the Bank of Japan to continue reforms. On the other hand, the dollar may weaken, including due to the expected easing of Fed policy.

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