Daily Market Analysis By FXOpen

USD/JPY Rate Updates the High of the Year


Yesterday, USD/JPY hit 146.74 for the first time since November 2022. The rise in the rate is facilitated by the growing gap in the policies of central banks: while the Bank of Japan has kept the rate below zero since 2016, the Fed has been raising rates since the spring of 2022.

Moreover, on Friday, Powell said the Fed is ready to continue to remain tough in the fight against inflation. According to CME's FedWatch tool, there is now a 62% chance of a rate hike at the Fed's November meeting, up from 42% a week earlier.

However, the limiting factor for the USD/JPY rate is the power of the Japanese Ministry of Finance. Last year, when the market was at current levels, the authorities intervened in the foreign exchange market, lowering the rate to 140 yen per US dollar.

The USD/JPY chart shows that:

→ the price con tinues to move within the ascending channel;
→ on Friday, during Powell's speech, the median line was tested, confirming its influence as a support;
→ former resistance at 144.8 also provides support;
→ if the trend continues, the rate may reach the upper limit of the channel — that is, the psychological mark of 150 yen per US dollar.



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When Will the Rate Hikes Stop? The Fed Ploughs on at Jackson Hole Despite Economic Progress


The United States Federal Reserve's consistent dialogue regarding interest rate increases has captured the attention of economists, policymakers, and financial markets worldwide.

Against the backdrop of a US economy that has shown remarkable resilience over the past two years, discussions surrounding interest rates have become a focal point of speculation and analysis. This article delves into the factors driving the Federal Reserve's decisions, the global context, and the implications for the US Dollar.

Steady US Economy and Debt Dynamics

The US economy's performance over the past two years has been characterised by steady growth and surprising resilience, given the substantial national debt that the country holds. Despite occasional fluctuations and challenges, the overall trajectory has been positive. The ability of the US economy to maintain its stability can be attributed to factors such as robust consumer spending, a strong labour market, and the government's targeted fiscal policies.

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Bitcoin Trading Volumes Fell to a Minimum of 4 Years


CNBC, citing CryptoQuant agency, reports that:

→ the total volume of bitcoins held on all cryptocurrency exchanges is at its lowest level since 2019;
→ as of August 26, the volume of bitcoin trading on all exchanges was about 130k BTC;
→ a maximum of 3.5 million BTC were traded in 1 day.

Perhaps the decrease in trading volumes is due to a drop in interest due to the uncertainty with the regulation of cryptocurrencies, or the fading of the bullish trend that began from the early days of 2023.

According to JP Morgan analysts, a decrease in open interest may indicate that the price of bitcoin is near a significant low, but the BTC/USD chart suggests that the bearish trend may continue. This is indicated by the descending channel, the outlines of which are becoming clearer.



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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

European Currencies Hit New Lows, Precious Metals on the Rise


European currencies, along with the yen and commodity currencies, came under pressure again last week. After Jerome Powell's hawkish talk at the Jackson Hole symposium, GBP/USD fell below 1.2600, EUR/USD broke support at 1.0800, and USD/JPY came close to 2023 extremes near 147. In the event of a breakout of these levels, the upward movement of the USD may increase sharply, which will lead to exponential growth. Conversely, a rebound from current levels could lead to a full-blown correction in almost all directions.

GBP/USD

The British currency, which is sensitive to the risky mood of market participants, broke through important support at 1.2600 last week and set a new August low at 1.2540. Jerome Powell's statements about the Fed's readiness to further raise the rate, if necessary, sharply strengthened the dollar, contributing to the collapse of GBP/USD. Nevertheless, at the beginning of the current five-day trading period, buyers of the pound managed to return the pair above 1.2600 and at the moment they intend to test 1.2700. If bulls meet serious resistance near the range of 1.2600-1.2700, another downward impulse may occur, the target of which will be a test of 1.2400-1.2200. If the pair gains a foothold above 1.2700, the resumption of growth to 1.3000-1.3100 may happen.

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EUR/USD Accelerates Gains from 2.5-month Low


This was facilitated by disappointing data on the US labor market. According to the Bureau of Labor Statistics, the number of new vacancies has fallen sharply: actual — 8.8 million, forecast — 9.4 million new vacancies. The last time the value of the indicator fell below 9 million was in the spring of 2021.

The news came as a big surprise, which sent the dollar index down sharply. Accordingly, USD-denominated shares and gold rose, as well as exchange rates traded against the dollar.



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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

EUR/USD Starts Recovery, USD/CHF Dips Below Support


EUR/USD started a recovery wave above the 1.0830 resistance. USD/CHF is showing bearish signs below the 0.8830 resistance zone.

Important Takeaways for EUR/USD and USD/CHF Analysis Today

• The Euro gained pace after it broke the 1.0830 resistance against the US Dollar.
• There was a break above a key bearish trend line with resistance near 1.0800 on the hourly chart of EUR/USD at FXOpen.
• USD/CHF is consolidating losses below the 0.8810 resistance.
• There was a break below a contracting triangle with support near 0.8830 on the hourly chart at FXOpen.

EUR/USD Technical Analysis

On the hourly chart of EUR/USD at FXOpen, the pair started a recovery wave from the 1.0770 level. The Euro even cleared the 1.0800 barrier to move into a bullish zone against the US Dollar.

Besides, there was a break above a key bearish trend line with resistance near 1.0800. It opened the doors for a move above the 50-hour simple moving average and 1.0830. Finally, the pair tested the 1.0880 resistance.



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FTSE 100 Goes on Massive Rebound! Marks & Spencer's Resurgence Sparks Optimism


The FTSE 100 index, a prominent benchmark of the UK stock market, has witnessed a remarkable turnaround in recent days. After a month-long decline that saw the index drop from 7,700 points on July 31 to as low as 7,262 points by mid-August, a sudden shift has propelled it to its highest point in five days, exceeding 7,503 points. This article employs technical analysis to dissect the factors contributing to this rebound and highlights the potential impact of Marks & Spencer's resurgence on the FTSE 100's performance.

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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

The US Dollar Is Correcting in Anticipation of US GDP Data Publication


The sharp strengthening of the American currency was replaced by a no less sharp corrective rollback. But whether this will be the beginning of a full-scale correction, we will see after the publication of important data for this week. In the coming trading sessions, the US GDP for the Q2, ADP Employment Change, as well as the NBS Non-manufacturing PMI in China will be released. These macroeconomic data are very important for market participants and can both reinforce existing trends and contribute to a reversal.

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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

BTC/USD Analysis: Bulls Lose Progress Amid SEC Defeat


On Tuesday, the price of bitcoin rose sharply from around USD 26,000 to USD 28,000 per coin. This was due to a ruling by the US District of Columbia Court of Appeals that said the Securities and Exchange Commission (SEC) was wrong to reject Grayscale's application to convert its Bitcoin Trust (GBTC) into a BTC Spot Exchange-traded Fund (ETF). A spot ETF would allow investors to access the leading cryptocurrency without actually holding BTC.

The SEC has repeatedly rejected Bitcoin spot ETF applications in the past, citing market manipulation concerns. But the court said the SEC failed to adequately explain its refusal to grant Grayscale's ETF bid, to the delight of the cryptocurrency community.



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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

The Price of Gold Rose by 3% in 10 Days


Back on August 21, gold was trading below USD 1,890 an ounce, but to date, its price has risen by about 3%. This was helped by published data on the number of vacancies in the US, which fell to the lowest level in almost 2.5 years in July. This and other signals of a slowdown in the US economy may influence the Fed's decision to continue raising interest rates further, which weakens the US dollar and supports the price of gold.

Bullish arguments:

→ the psychological barrier of USD 1,900 serves as an important support. The price of gold was there for only a few days, after which a steady increase followed.

→ The USD 1,920 resistance level was taken under control by the bulls after the breakdown on August 28-29. Now we can expect that there will be support here.

→ If a moderate decline on low volumes follows in the coming days, this will be a sign of a normal correction in a bull market



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Disclaimer: This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.