AUD/USD - Bias = Bearish
Based on the daily chart, the general trend of the AUD/USD is still bearish; we have now broken out of the channel and aim to make new lows. This instrument will continue to be sold until something fundamentally and also technically changes. Any trade opportunities will be posted in the discord channel.
For the first time since July 2020, the Australian dollar dropped below 0.7000 against the US dollar on Friday. The Aussie has been losing ground amid hawkish signals from the Federal Reserve, compounded by risk-off trades in the currency markets fuelled by fears around Omicron variants. There are increasing numbers of Fed officials who support normalizing policies and raising interest rates in order to combat inflation. Omicron, which poses economic risks and supports the Reserve Bank of Australia's position to keep record low interest rates, also pushed the currency downward. Next week, the RBA will meet to discuss monetary policy, with markets speculating how it might respond to the Fed's shift towards a faster pace of tapering.
EUR/USD - Bias = Bearish
On the daily chart of EUR/USD, we can see that the general trend is still bearish, and we plan to sell any rallies that may occur in this instrument
Despite a weaker dollar and falling bond yields, the euro snapped back above $1.13, as investors feared a new and possibly vaccine-resistant coronavirus variant could hurt the ongoing economic recovery. Yet, the euro remains close to its weakest level since July 2020 amid concerns over new COVID restrictions across Europe and as investors expect the US Federal Reserve to tighten monetary policy faster than other major central banks. As observed by the minutes of the ECB and Fed policy meetings last week, officials in Europe agreed that monetary policy support to the economy would need to be reassessed at some point in the future and reiterated that the recent inflation increase was only temporary, whereas US officials said they were ready to raise interest rates if inflation continued to rise.
GBP/USD - Bias = Bearish
Based on the daily chart, the overall trend of the GBP/USD remains bearish, which is likely to continue as we retest daily resistance.
Trade opportunities will only become available on the lower timeframes, plans will be shared on the Discord channel.
As investors rushed to safety amid panic over a new COVID-19 variant and doubts on whether the Bank of England will raise interest rates at its December meeting, the British pound changed hands at $1.33, the weakest level since December 2020. On top of that, the US dollar remained close to a 16-month high on expectations of a rate hike next year. Gov. Andrew Bailey said last week central banks took risks by attempting to forecast what rates will do after being accused by some investors of sending the wrong signal about the possibility of policy tightening earlier this month. Additionally, he has expressed concern about inflation and growth risks, taking a more cautious tone than he previously did
NZD/USD - Bias = Bearish
On the daily chart, NZD/USD is still in a bearish trend, and we have broken out of the daily channel that offered no real support. Any pull back should present an opportunity to sell this currency as new lows are expected.
New Zealand's dollar depreciated past 0.6760 on Friday, reaching a new 1-year low and dropping for the fifth week in a row. Over the past month, the Kiwi has been losing ground amid hawkish signals from the Federal Reserve, exacerbated by risk-off trades on the currency markets due to fears surrounding the Omicron variant. During its last meeting, the Reserve Bank of New Zealand raised the Official Cash Rate by 25 basis points to 0.75%, in line with expectations but short of market speculations for a 50 bps hike that would have been more supportive of the currency. According to Yuong Ha, chief economist of the Reserve Bank of New Zealand, the new Omicron variant is unlikely to affect the central bank's rate hike plans due to the new Covid protection framework.
USD/CAD - Bias = Bullish
On the daily chart, USD/CAD is still in a bullish trend, and we continue to trade in a bullish daily channel. Any pull back should present an opportunity to buy this currency as new highs are expected.
The Canadian dollar traded around 1.284, getting closer to a 10-month low of 1.2849 hit on February 1st as markets weighed the risks of the Omicron variant against Federal Reserve officials' hawkish comments. Even though the oil prices – a major Canada’s export – have rebounded recently they are still trading around 67$ a barrel, the lowest since late August. Still, upbeat economic data in Canada helped to cushion further losses in the loonie. The jobs report showed that the economy added a net 153.7 thousand jobs in November, above market expectations of 35 thousand, pointing to the sixth consecutive month of expansion in the workforce. Meanwhile, third-quarter GDP figures showed that the economy grew at an annualized rate of 5.5%, rebounding from a contraction of 3.2%, and above forecasts of 3%.
USD/CHF - Bias = Neutral
We are trading within this bullish channel on the daily chart, but with money pouring into the Swiss franc amid fears of the Corona virus variant, we are taking a neutral view on this instrument and will sit on the sidelines for the time being.
With the spread of the Omicron variant, investors sought out the Swiss franc's safety as the franc hovered around 3-week highs. According to US Treasury officials, the Swiss National Bank (SNB) met two of the three criteria to be labelled as a currency manipulator. The SNB stated that it has not been involved in any currency manipulation. Switzerland's franc maintained its gains against the euro, surpassing six-year highs amid pandemic concerns and inflationary pressure.
USD/JPY - Bias = Neutral
We are trading within this bullish trend on the daily chart, but with money pouring into the Yen amid fears of the Corona virus variant, we are taking a neutral view on this instrument and will sit on the side-lines for the time being. We believe our main trading opportunities may come from buying yen against crosses
The Japanese yen strengthened past 113 per US dollar on Friday, benefitting from risk-off trades in the financial markets driven by fears around the Omicron variant and a firm hawkish pivot by the Federal Reserve. Investors positioned cautiously ahead of the weekend by selling growth stocks and risk-sensitive currencies in favor of defensive stocks, bonds and safe haven assets such as the Japanese yen and the Swiss franc. Moreover, Bank of Japan board member Hitoshi Suzuki said on Thursday that the central bank will soon discuss ending the pandemic-relief funding programs in March. Meanwhile, the yen is still under pressure from growing policy divergence between the US and Japan, with a growing number of Fed officials having thrown their support behind normalizing policies and setting the stage for hiking rates to combat inflation. The BOJ on the other hand remained firm in its commitment to retain easy monetary policies to achieve its 2% price stability target