1. Forex Market Insight
The dollar index briefly reduced its gains after economic data released by the Institute for Supply Management (ISM) showed the index of U.S. manufacturing activity fell to 58.7 last month, below the estimate of 60.0, the lowest level since January 2021, after a reading of 61.1 in November.
Other data showed that a record 4.5 million Americans voluntarily quit their jobs in November, which could force companies to raise wages to attract employees. With this, the risks to the dollar in early 2022 are tilted to the upside. Unless the ECB shifts to raise interest rates, the normalization of its policies will not be able to support the euro.
(EUR/USD 1-hour chart)
Today, pay attention to the suppression of the 1.1338-line. If the euro runs stably below the 1.1338-line, then pay attention to the support at the lower 1.1267 and 1.1250 positions. If the euro breaks through the 1.1338-line, then pay attention to the suppression at the 1.1357 and 1.1378 positions.
GBP Intraday Trend Analysis
Pound rose by 0.37% against the dollar to 1.3530, hitting 1.3557 intraday, the highest since 10th November last year, as higher U.K. Treasury yields, and cross-rate-related buying supported the pound.
During this interval, the euro fell to 0.8340 against the pound, the lowest level since February 2020, as markets expect the Bank of England to raise interest rates next month.
At the same time, the pound rose by 1.3% against the yen to the highest level since October 2021 as yield differentials widened.
(GBP/USD 1-hour chart)
The pound today is mainly focused on the 1.3522-line. If the pound runs below the 1.3522-line, then pay attention to the support at 1.3450 and 1.3409. If the pound runs above the 1.3522-line, then pay attention to the suppression at the 1.3574-line.
2. Precious Metals Market Insight
Yesterday, gold prices rebounded slightly, regaining some part of the ground lost on Monday, 3rd January 2022.
Due to the surge in the number of infections in the United States and the weak U.S. economic data, the Fed’s interest rate hike is still expected to put pressure on gold prices.
The focus during the day will be on the U.S. “small non-farm payrolls” employment data and the Minutes from the Federal Reserve monetary policy meeting.
(Gold 1-hour chart)
Today, gold pays attention to the 1812-line. If the price of gold runs stably below the 1812-line, then pay attention to the support of the 1804 and 1793 positions. If the price of gold breaks through the 1812-line, it will open up further a upside space. At that time, pay attention to the suppression of 1820.
3. Commodities Market Insight
WTI Crude Oil
Yesterday, U.S. oil rose to a new high of $77.64/bbl since 26th November 2021, while Brent oil soared to $80/bbl, the highest level since November 2021.
The market’s concerns about the impact of the Omicron outbreak on demand eased and OPEC+ expects global oil supplies to be tighter than previously expected.
Intraday focus on the U.S. December ADP employment, EIA data, and the Thursday, 3:00, Minutes from the Federal Reserve monetary policy meeting.
(Crude oil 1-hour chart)
Today, oil prices are paying attention to the 76.89-line. If the oil price runs below the 76.89-line, then it will still pay attention to the support at the 75.04 and 72.77 positions. If the oil price breaks through the 76.89-line, then pay attention to the suppression of the 78.92-line.
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