Daily Analyses

The activity in the Fx market today shows a classic risk-off wave triggering massive selling in risky assets and currencies. As would be expected, the AUDJPY pair is one of the most affected and is experiencing a deep sell-off in today's session, down 200 pips at one point. The selling blasted through all three HFT buying pressure zones, which are noted today at these levels:

Despite today's growth, EUR / USD remains in the long-term bear market zone, trading below the key resistance levels 1.1620 (EMA200 on the weekly chart), 1.1735 (EMA200 on the daily chart), 1.1885 (EMA200 on the monthly chart). Further decline in EUR / USD is most likely. In view of this, short positions for this currency pair remain preferable, and today's corrective growth provides a good opportunity to enter short positions from current levels: at the time of publication of this article, it rose to 1.1281 mark, close to the strong resistance level 1.1285 (ЕМА200 at the 1-hour level and the Fibonacci level 23.6% of the upward correction in the wave of the pair's decline from the mark of 1.3870, which began in May 2014, to the mark of 1.0500). Nevertheless, we also do not forget about stops and set them above 1.1315.

There is a sharp correction in the market today. Market participants are deeply concerned about reports of the discovery of a new mutated strain of coronavirus in South Africa, which has raised concerns about new lockdowns that could negatively affect the pace of economic growth. Today we are seeing a sharp drop in the quotes of commodities and commodity currencies and an increase in demand for protective gold, franc and yen. The DXY dollar index also did not resist and after rising the day before to new 16-month highs near the mark of 96.94, today it fell sharply, mainly due to the weakening of the dollar against the yen and the euro, whose share in the DXY is about 14% and 57%, respectively. Meanwhile, the strengthening of the euro, observed today, should be attributed so far only to the correction.

Since the beginning of this month, USD / CHF has been growing, building on the upward momentum that emerged at the beginning of the year. At the beginning of today's European session, USD / CHF is traded near 0.9335 mark, bouncing from yesterday's local and intra-monthly highs near 0.9370 mark, through which an important long-term resistance level (ЕМА144 on the weekly chart) passes. The trend towards further growth in USD / CHF remains, and technical indicators OsMA and Stochastic on the daily and weekly charts are also signaling this.

As follows from the punctures of the November meeting published last Wednesday, the Fed leaders expressed increased concern about the persistence of increased inflation, and also discussed whether they need to prepare for an increase in interest rates in the first half of next year to cool the economy. As you know, following the meeting that ended on November 3, the Fed leaders decided to reduce the volume of purchases of assets, which amounted to $ 120 billion a month, by $ 15 billion in November and December. In their view, such a cut, "is likely to be appropriate every month", although they are willing to adjust the pace of the curtailment of purchases, "if it is justified in view of changes in the outlook for the economy". At a press conference, Jerome Powell reiterated that the central bank will not rush to raise interest rates, since the labor market has not yet fully recovered, and the Fed still considers increased inflation to be a temporary phenomenon.

We are analyzing HFT algorithms' activity today and note that the EURUSD pair may provide more short-term bearish setups. Namely, following the recent downtrend, EURUSD is consolidating today and rising toward the light HFT selling pressure zone located at 1.1239 and above.

HFT algorithms' activity in the Fx market today shows that the USDJPY pair is stuck in a sideways 30-pip range ahead of a busy calendar day with multiple market-moving reports and events. The two nearest HFT zones where buying and selling interest may increase are noted at these levels for today:

As we noted above, the XAU / USD pair has dropped sharply in the past few days. Since the beginning of November, the increase has amounted to more than 3.5% against the background of strong inflation in the United States. Nevertheless, XAU / USD is declining again, having dropped below the key support level 1800.00 (ЕМА200 on the daily chart and ЕМА50 on the weekly chart). The decline accelerated after it became known that US President Joe Biden had appointed incumbent US Federal Reserve Chairman Jerome Powell for a second term. This intensified the talk that the current Fed's course of tightening monetary policy will be further developed in the near future.

The strengthening of the dollar is gaining momentum. At the beginning of the week, its buyers were encouraged by the re-election of Jerome Powell to a second term as chairman of the Federal Reserve System, which strengthened the expectations of the markets for a rise in interest rates next year, and today market participants are waiting for a new portion of positive, as expected, macro statistics from the United States, which could give the dollar a new upward impetus. Among the block of important macro statistics, the publication of which is scheduled for 13:30 and 15:00 (GMT), is the latest weekly statistics from the US labor market.