BTC/USD Weekly Forecast (10th January 2022 – 14th January 2022)

Fundamental view:

Bitcoin showed a sell – off during the trading course of the week and reached its five month low of $40648. The Hawkish Fed is the main catalysts behind the fall. The Federal Reserve Bank released the minutes of its December meeting this week, which elaborated that there is a greater urgency to scale back the unprecedented level of support for the US economy, due to stubbornly high inflation as the job market also approaches full employment. Fed policymakers will began discussing the reduction of their bonds holding in the upcoming months. Additionally,  political unrest continued in Kazakhstan, caused a decline in bitcoin’s global computing power. This happened after the internet was shut down nationwide.

On the other hand, Chris Kline, COO and co-founder of Bitcoin IRA said “This is a healthy pullback as all markets look to readjust to new monetary policies and inflation concerns,” “Inflation is not going away anytime soon and investors are looking to protect themselves from higher prices and rapidly changing economic conditions, and see crypto as a potential hedge.”

The major economic events deciding the movement of the pair in the next week are Fed Chair Powell Testimony at Jan 11, EIA Crude Oil Stocks Change, Federal Budget Balance at Jan 12, Initial Jobless Claims at Jan 13, Retail Sales monthly report and Fed Industrial Production yearly report at Jan 14 for US.

BTC/USD Weekly outlook:

Technical View:

Last week’s high was 9.4% lower than the previous week. Maintaining high at 47569.1 and low at 40648.7 showed a movement of 6921 pips.

In the upcoming week we expect BTC/USD to show a bearish trend. The Instrument is trading below the 200 Simple Moving Average and the MACD trades to the downside. Should 39173.0 proves to be unreliable support then the pair may fall further to 36450.6 and 32252.6 respectively whereas a solid breakout above 46093.4 will open a clear path upward to 50291.4 and then will further raise up to 53013.8. In H4 chart descending triangle breakout favors prospects of a bearish trend. Bearish harami pattern constructs a bearish outlook for the pair in the upcoming week.

Preference
Sell: 41875.2 target at 34981.6 and stop loss at 46098.4

 

Alternate Scenario
Buy: 46098.4 target at 53012.8 and stop loss at 41875.2

XAU/USD Weekly Forecast (10th January 2022 – 14th January 2022)

Fundamental view:

Gold had a poor week and dropped to a fresh three-week low, around the $1.782 level as a reaction to Hawkish fed and mixed US jobs report. Central bank released the Minutes of its December meeting, which showed that policymakers began discussion about the reduction of their bonds holding in the upcoming months. And also Fed a judged that conditions for a rate hike could be met soon suppose if the recent pace of labor market improvements continued. Federal Reserve President James Brian Bullard  said “The FOMC is in (a) good position to take additional steps as necessary to control inflation, including allowing passive balance sheet runoff, increasing the policy rate, and adjusting the timing and pace of subsequent policy rate increases,” “With the real economy strong but inflation well above target, US monetary policy has shifted to more directly combat inflation pressure,” Bullard said, adding that he expects cases of the omicron variant to slow in the coming weeks.

Talking about the Job data, The NFP showed that the economy had added 199K new jobs in December, which is far less than estimation of 400K. However, The disappointment was offset by an upward revision of the previous month’s reading to 249K from 210K. Additionally, the unemployment rate fell to 3.9%, beating expectations for a modest downtick to 4.1% from 4.2% previous. Elsewhere, the finding that widely spreading Omicron leads to less hospitalization and death compared to previous variant delta creates optimisms However; the disruption in the services due to the rising cases of Omicron slows down the economic growth further leading to a tepid market sentiment.              

The major economic events deciding the movement of the pair in the next week are Fed Chair Powell Testimony at Jan 11, EIA Crude Oil Stocks Change, Federal Budget Balance at Jan 12, Initial Jobless Claims at Jan 13, Retail Sales monthly report and Fed Industrial Production yearly report at Jan 14 for US.

XAU/USD Weekly outlook:

Technical View:

Last week’s high was 0.07% higher than the previous week. Maintaining high at 1831.6 and low at 1782.2 showed a movement of 494 pips.

In the upcoming week we expect XAU/USD to show a bearish trend. The Instrument is trading below the 100 Simple Moving Average and the MACD trades to the downside. Should 1774.7 proves to be unreliable support then the pair may fall further to 1753.7 and 1725.3 respectively whereas a solid breakout above 1824.1 will open a clear path upward to 1852.5 and then will further raise up to 1873.5. In H4 chart M-Pattern breakout favors prospects of a bearish trend. Also to be noted shooting star formation exerts the expectation of downtrend for the pair.

Preference
Sell: 1794.4 target at 1745.7 and stop loss at 1829.6

 

Alternate Scenario
Buy: 1829.6 target at 1872.5 and stop loss at 1794.4

AUD/USD Weekly Forecast (10th January 2022 – 14th January 2022)

Fundamental view:

The Australian dollar has fallen during most of the week against the American dollar. The rationale behind this can be linked to the Hawkish Fed. The minutes from the Central bank’s December 16 meeting highlighted a discussion about reducing the bank’s $8.5 billion balance sheet. Fed also judged that conditions for a rate hike could be met soon suppose if the recent pace of labor market improvements continued. Inflation-related concerns made even the most dovish policymakers to favor rate hike.

On contrary, The Reserve Bank of Australia is with a view that it’s a matter of time that inflation will return to acceptable levels. Australian policymakers insisted that a rate hike would be unlikely, at least until 2024.

In this week, Commonwealth Bank Manufacturing PMI on 4th January, US Trade Balance on 6th January and US nonfarm payroll on 7th January  favored uptrend whereas JOLTS Job Openings on 4th January and ANZ Job Advertisements monthly report on 5th January created downtrend for the pair.

The major economic events deciding the movement of the pair in the next week are Australia Building Approvals monthly report at Jan 10, Fed Chair Powell Testimony, Australia Retail Sales monthly report at Jan 11, EIA Crude Oil Stocks Change, US Federal Budget Balance at Jan 12, US Initial Jobless Claims at Jan 13, US Retail Sales monthly report and Fed Industrial Production yearly report at Jan 14.

AUD/USD Weekly outlook:

Technical View:

Last week’s high was same as the previous week. Maintaining high at 0.7276 and low at 0.7129 showed a movement of 147 pips.

In the upcoming week we expect AUD/USD to show a bearish trend. The currency pair is trading below the 100 Simple Moving Average and the MACD trades to the downside. Should 0.7113 proves to be unreliable support then the pair may fall further to 0.7048 and 0.6966 respectively whereas a solid breakout above 0.7260 will open a clear path upward to 0.7342 and then will further raise up to 0.7407. In H4 chart inverted cup and handle pattern favors prospects of a bearish trend. Also to be noted bearish harami formation exerts the expectation of downtrend for the pair.

Preference
Sell: 0.7175 target at 0.7049 and stop loss at 0.7265

 

Alternate Scenario
Buy: 0.7265 target at 0.7406 and stop loss at 0.7175

USD/JPY Weekly Forecast (10th January 2022 – 14th January 2022)

Fundamental view:

US dollar had a good start at the beginning of the week but later gave up some gains against the yen during the trading course of the week. The minutes from the Central bank’s December 16 meeting highlighted a discussion about reducing the bank’s $8.5 billion balance sheet. Fed also judged that conditions for a rate hike could be met soon suppose if the recent pace of labor market improvements continued. However, NFP was a big disappointment. December job creation registered just 199,000, less than half the 400,000 forecast.

On the other hand, Annual inflation in Tokyo was slightly stronger at 0.8% in December but the core Consumer Price Index (CPI) remained unchanged at -0.3%, which made Bank of Japan no reason to alter its ultra-accommodative monetary policy or lift its base rate from -0.1%. 

US ISM Manufacturing PMI on 4th January and US Non Farm Payroll on 7th January created bearish trend whereas ADP Nonfarm Employment Change on 5th January, ISM Non-Manufacturing Employment on 6th January and Japan Household Spending yearly report on 7th January created bullish trend.

The major economic events deciding the movement of the pair in the next week are Fed Chair Powell Testimony, Japan Adjusted Current Account at Jan 11, EIA Crude Oil Stocks Change, US Federal Budget Balance at Jan 12, BoJ Corporate Goods Price Index monthly report, US Initial Jobless Claims at Jan 13, US Retail Sales monthly report and Fed Industrial Production yearly report at Jan 14.

USD/JPY Weekly outlook:

Technical View:

Last week’s high was 0.98% higher than the previous week. Maintaining high at 116.35 and low at 114.95 showed a movement of 140 pips.

In the upcoming week we expect USD/JPY to show a bullish trend. The currency pair is trading above the 200 Simple Moving Average and the MACD trades to the upside. A solid breakout above 116.27 may open a clean path towards 117.01 and may take a way up to 117.67. Should 114.87 prove to be unreliable support, the USDJPY may sink downwards 114.21 and 113.47 respectively. In H4 chart, Formation of bullish flag pattern indicates reversal of the trend creating prospects of a bullish trend Along with a hammer formation braces our expectation.

Preference
Buy: 115.65 target at 117.00 and stop loss at 114.82

 

Alternate Scenario
Sell: 114.82 target at 113.48 and stop loss at 115.65