Daily Market Analysis

There are rumors from influential sources pointing at Kazuo Ueda as the next governor of the Bank of Japan (BOJ). This decision could lead to the commencement of policies in favor of raising interest rates and monetary policy tightening. Seeing how his appointment is coming after the Yen has lost ground against the Dollar and other top economies, it is only natural to expect a yen recovery. However, let's check the technical factors for confirmation of this prediction to see if the stars align.

This week, there is a thrilling array of fundamental releases for the US Dollar. This array features several high-impact news releases like the Consumer Price Index (CPI), Retail Sales, and the Producer Price Index (PPI). The overall impact of this line-up remains to be seen, but we can formulate predictions based on the current price action on the DXY and the major pairs. Let's take a look at them right away!

On Friday 10th February 2023, the Office for National Statistics published the figures for the Gross Domestic Product (GDP) as 0.1% which turned out greater than the initial forecast of -0.2%. As a result of the positive outlook of this report, we need to examine the short-term impact on GBP pairs from a technical point of view.

This week, there are a few high-probability trade ideas I'd like to recommend to you. Trading these setups, be sure to implement a proper risk management approach.

On Thursday, the 2nd of February, the Bank of England will publish its report concerning interest rates and inflation data for the Eurozone. Professionals and investors anticipate that Andrew Bailey’s lead team of policy makers will likely raise interest rates to 4%; the highest in over a decade, for the tenth time in a row.

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?

Today, at 5:00 pm (GMT +2), the Bank of Canada will publish the Overnight Rate, which represents short-term interest rates, and is pivotal to the overall pricing of the Canadian Dollar in the global markets. Let's look at how the markets are faring ahead of the BoC rates release.

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.

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.

Later today Tiff Macklem, the governor of the BoC (Bank of Canada) is expected to speak at the Riksbank's International Symposium as part of a discussion panel on 'Central Bank Independence'.