Who’s planning on trading the U.S. CPI report?
Check out this short-term support zone I’m watching on USD/CHF in case we see an upside surprise.
Before moving on, ICYMI, yesterday’s watchlist checked out a triangle breakout idea on EUR/GBP. Be sure to check out if it’s still a valid trade!
And now for the headlines that rocked the markets in the last trading sessions:
Upcoming Potential Catalysts on the Forex Economic Calendar:
Fed head Powell: U.S. economy can withstand Omicron surge
World Bank predicts “hard landing” for poorer economies
New Zealand ANZ commodity prices post 0.2% decline after earlier 2.8% jump
Another area in Chinese province of Henan announced lockdown today
Chinese CPI slowed from 2.3% to 1.5% y/y vs. 1.7% forecast
Chinese PPI slid from 12.9% to 10.3% vs. 11.3% consensus
Japanese manufacturers turned less optimistic about conditions in Jan
BOJ raised assessment for all regions in latest economic outlook report
Japanese Economy Watchers Sentiment index up from 56.3 to 56.4
API reported draw of 1.08 million barrels in crude oil inventory
Upcoming Potential Catalysts on the Forex Economic Calendar:
U.S. headline and core CPI at 1:30 pm GMT
BOE MPC member Cunliffe’s testimony at 2:15 pm GMT
FOMC member Brainard’s speech at 3:00 pm GMT
U.S. EIA crude oil inventories at 3:30 pm GMT
Fed Beige Book due 7:00 pm GMT
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️
What to Watch: USD/CHF
I’m banking on more action from the scrilla later today when Uncle Sam prints the December CPI report!
Market analysts predict that the headline figure could dip from 0.8% to 0.4% while the core reading might hold steady at 0.5% for the month.
If we see stronger than expected results, dollar bulls could charge on hopes that the Fed could carry on with its tightening plans for the year.
In that case, USD/CHF could bounce off the area of interest spanned by the Fibonacci retracement levels and the rising trend line on its hourly chart.
This potential support zone is looking strong since it lines up with a former resistance area and the 100 SMA dynamic inflection point, too!
Technical indicators confirm a likely continuation of the rally since the 100 SMA is above the 200 SMA while Stochastic is reflecting exhaustion among sellers. Turning back up would mean that buyers are returning and could take the pair back up to the swing high.
