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.
The Australian dollar firmed towards a two-week high of 0.717 per USD on Friday, remaining vulnerable to Omicron variant-related headlines and expectations of further policy tightening by the Federal Reserve. The Aussie gained earlier this week after the Reserve Bank of Australia kept rates unchanged, but analysts pointed out a subtle change in the central bank’s language where a reference to inflation sitting in the bank’s target by late 2023 was removed, suggesting it is giving itself room to move a little sooner. Meanwhile, lingering threat from the new variant and looming policy decisions by major central banks next week kept markets on edge. The currency is headed for a weekly advance for the first time in six weeks.
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.
The Euro was around $1.13 in the second week of December as investors try to assess the impact omicron will have on the economic recovery after countries including the UK and Denmark introduced restrictions, despite encouraging news from Pfizer and BioNTech that announced a 3rd dose of its coronavirus vaccine is effective in neutralizing the variant. Europe battles with a new wave of infections, slowing economic growth and surging energy prices. ECB President Christine Lagarde told Reuters last week the bloc's central bank may set policy for a relatively short period at this month's meeting, given heightened uncertainty
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.
The British pound weakened to $1.32 in December, touching its lowest level since November 2020, after Prime Minister Boris Johnson's government announced tougher restrictions against COVID-19 in England due to the rapid spread of the Omicron variant. The new measures include ordering people to work from home, wear masks in public places and use vaccine passes. Meanwhile, investors have scaled back expectations of an interest rate hike by the Bank of England next week following the imposition of those restrictions and despite mounting inflationary pressure. Elsewhere, the US Federal Reserve is expected to announce it will accelerate tapering of its bond-buying programme at its December meeting
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.
The New Zealand dollar stabilized below 0.6800 against the US dollar on Friday, remaining vulnerable to Omicron variant-related headlines and expectations of further policy tightening by the Federal Reserve. The Kiwi has been in a downtrend since the start of November amid a series of hawkish signals from the Federal Reserve. The Reserve Bank of New Zealand also raised the Official Cash Rate by 25 basis points to 0.75% in its last meeting, in line with expectations but fell short of market speculations for a more aggressive 50 bps hike that analysts believed would be more supportive of the currency. Meanwhile, RBNZ assistant governor Christian Hawkes recently commented that a stronger currency will help the central bank achieve its policy objectives more quickly.
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 1.272 in the second week of December, after hitting a near 2-week high of 1.2644 on December 7th, as US consumer prices rose 6.8% YoY in November, the fastest increase in prices since 1982, strengthening the case for a quicker tapering by the US Fed, while higher oil prices cushioned further losses. Meanwhile, in its last meeting, the BoC said that the new variant Omicron had raised the uncertainty around the economic recovery and maintained its guidance of start rates hike during the middle quarters of 2022, dashing some investors' expectations of a shift for a more hawkish policy stance. Meanwhile, the central bank decided to resume the reinvestment phase at roughly the same pace, during which it purchases government bonds solely to replace maturing bonds. Still, the policymakers noted that recent economic indicators suggested the economy had gained considerable momentum in Q4 namely in the labor and housing markets.
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.
The Swiss Franc was trading at 0.92 per USD, easing from a 3-week high of 0.917 to trade hit on December 3rd, amid hawkish narrative by the Federal Reserve and as pandemic fears waned. Risked appetite increased after hospital observations in South Africa showed Omicron variant patients are only reporting mild symptoms. At the same time, the anticipation of a quicker taper by the Federal Reserve boosted the dollar. Meanwhile, the Swiss franc hovered around 6-year highs against the Euro, amid a revival of pandemic-related restrictions and rising inflationary pressure in the Eurozone.
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 stabilized around 113.5 per US dollar on Friday, remaining vulnerable to Omicron variant-related headlines and expectations of further policy tightening by the Federal Reserve. Some countries started implementing renewed restrictions as global cases rise, with a study suggesting that the new variant is more transmissible and has a higher chance of escaping immunity than the delta. Meanwhile, divergent monetary policies continued to weigh on the Japanese currency, as hawkish signals from the Federal Reserve contrasted with the Bank of Japan’s firm commitment to retain easy monetary policies to achieve its 2% price stability target. The BOJ is set to maintain ultra-easy policies at the scheduled meeting next week, but is expected to consider whether to scale back pandemic-related emergency funding.