Signs of prolonged USD weakness
The USD is generally predicted to continue its downward trend, with the current decline likely to persist. This trend is influenced by year-end dynamics, which historically weaken the USD towards the year's close. Furthermore, countries moving away from using the USD (de-dollarization) and worsening geopolitical influences related to the US contribute to a diminishing trust in the USD, furthering its weakening. This impact is expected to significantly boost currencies against the USD. Additionally, the global economic outlook is currently not robust; countries opposing the USD intend to hold interest rates to influence domestic purchasing power and prevent price hikes. This anticipated USD decline is projected to persist for several weeks, potentially slowing down the US economy.
Calendar:
XAUUSD
Technical Analysis
Bullish Continuation
Demand Levels: 2016.26 - 2021.81
The prediction for gold today continues the upward trend, in line with the previous forecast that indicated an upward movement. However, it seems this surge will be quite substantial, potentially leading to a long-term decline in the USD. This opportunity is often seized upon by certain investors. This analysis utilizes a roadmap analysis that aids in determining price movements. The news announcement from the previous Tuesday (19/12) had minimal impact on market movements, enhancing the likelihood of yesterday's gold increase. Furthermore, several Federal Reserve officials downplayed expectations for an immediate dovish policy shift by the central bank, which has somewhat helped stem the recent dollar weakness. A number of Fed officials stated on Monday that market enthusiasm for an imminent interest rate cut is unfounded, and high inflation could tighten monetary conditions for a longer period.
Technical Analysis
Bullish Continuation
Demand Levels: 72.41 - 73.00
The prediction for Oil indicates a continued upward trend in prices within the mentioned range. This surge in Oil prices will lead to increased costs of necessities and a scarcity in Oil production. Looking ahead, it seems Oil prices will tend to remain high, resulting in sustained high demand and a long-term projected increase in prices. Additionally, this rise in Oil prices is attributed to escalating geopolitical conflicts, such as the recent attack by Houthi military groups on Norway's assets in the Red Sea on Monday. This attack prompted BP to temporarily halt Oil shipments via the Red Sea. The analysis is supported by candlestick analysis and trend analysis.
Technical Analysis
Bearish Continuation
Supply Levels: 144.873 - 144.528
The current prediction for the USD suggests an initial rise, aligning with the previous day's forecast indicating an upward tendency in price. However, the present scenario is likely to witness an extended downturn against the USD, leading to a long-term strengthening of the Yen. The impact of this USD weakening is causing the Yen to experience relatively high inflation. Consequently, the BOJ decided in the previous session to hold interest rates to restrain the price hike pattern, aiming to regulate purchasing power within Japan. Overall, the larger trend indicates Yen strength for the current situation, potentially continuing the upward trajectory for the Yen afterward.
GBPUSD
Technical Analysis
Continuation Bullish
Demand Levels: 1.26441 - 1.26657
The prediction for the British Pound against the USD indicates a continuation of its previous strengthening trend, albeit with a slight decline in the current scenario. Despite this, it's important to note that the overall trend still suggests an increase in the Pound's value. It seems that for the present moment, there's a minor dip to resolve before resuming the upward trend. Today's news regarding the Pound will cover the 'Inflation Rate,' which is anticipated to weaken concerning the Pound. However, even though this weakening trend is expected, it might not have a significant impact, allowing room for potential upward movement. This analysis prediction is supported by candlestick analysis and trend analysis.
HSI
Technical Analysis
Bullish Reversal
Demand Levels: 16103 - 16518
The prediction for the Hang Seng index leans towards an expected and sustained rise, supported by candlestick patterns indicating a continuation of prices. Although there has been a slight prior decrease, the overall pattern suggests a notable upward trend ahead. Previously, this upward momentum might be attributed to The Fed's decision during the FOMC meeting, which signaled weakness in the USD. This would contribute to the Hang Seng's rise, and for today, the potential prolonged weakening of the USD suggests a strengthening of the Hang Seng index. This presents an opportunity for an upward movement and appeals to investors favoring the Hang Seng index. For today, the Hang Seng is predicted to continue its upward trend, with a slight decrease followed by subsequent gains. The data indicates a weakening of the USD, resulting in an impact on the rise of the Hang Seng Index.
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