USD/JPY Weekly Forecast (3rd January 2022 – 7th January 2022)

Fundamental view:

US dollar rallied against the Japanese yen during the trading course of the week. The US policymakers are hopeful of reaching an agreement over the Build Back Better (BBB) whereas Japanese diplomats cheer record budget and show readiness to battle the pandemic. Elsewhere, Authorities from Japan have recently suggested further easy money policies while citing the Omicron woes and rejecting inflation fears. Meanwhile, Omicron cases seem to rise both in US and Japan However, traders seem to be confident about the global recover with diminishing fear of Omicron.

In this week, Japan retail sales monthly report on 27th December and Japan Industrial Production monthly report on 28th December favored bearish trend whereas EIA Crude Oil Stocks Change on 29th December and US Continuing Jobless Claims on 30th December favored bullish trend.

The major economic events deciding the movement of the pair in the next week are OPEC Meeting, Japan Markit Manufacturing PMI, US ISM Manufacturing PMI at Jan 04, US ADP Nonfarm Employment Change, EIA Crude Oil Stocks Change, FOMC Minutes at Jan 05, Japan Markit Services PMI, Initial Jobless Claims at Jan 06 and US Nonfarm Payrolls at Jan 07.

USD/JPY Weekly outlook:

Technical View:

Last week’s high was 0.62% higher than the previous week. Maintaining high at 115.22 and low at 114.31 showed a movement of 91 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 115.42 may open a clean path towards 115.77 and may take a way up to 116.33. Should 114.51 prove to be unreliable support, the USDJPY may sink downwards 113.95 and 113.60 respectively. In H4 chart, Formation of bullish pennant chart pattern indicates reversal of the trend creating prospects of a bullish trend Along with a hammer formation braces our expectation.

Preference
Buy: 115.06 target at 115.76 and stop loss at 114.46

 

Alternate Scenario
Sell: 114.46 target at 113.61 and stop loss at 115.06

GBP/USD Weekly Forecast (3rd January 2022 – 7th January 2022)

Fundamental view:

The British pound rallied against the greenback during the trading course of the week. The move behind that can be linked to the hopes of fewer hospitalizations due to Omicron variant and month, quarter, and year-end flow. The British pound also had a nice bounce due to the fact that the UK decided not to lock itself down again. As new year 2022 begins, traders are concentrating on higher inflation, central bank tightening, led by the Federal Reserve, the coronavirus pandemic, and China’s economic outlook.

In this week, CFTC GBP Non-Commercial Net Positions on 27th December and Baker Hughes US Oil Rig Count on 30th December favored bearish trend whereas Pending Home Sales monthly report on 29th December and UK Nationwide HPI monthly report on 30th December favored bullish trend.

The major economic events deciding the movement of the pair in the next week are OPEC Meeting, BoE Consumer Credit monthly report, US ISM Manufacturing PMI at Jan 04, US ADP Nonfarm Employment Change, EIA Crude Oil Stocks Change, FOMC Minutes at Jan 05, UK Markit/CIPS Services PMI, Initial Jobless Claims at Jan 06 and US Nonfarm Payrolls at Jan 07.

GBP/USD Weekly outlook:

Technical View:

Last week’s high was 0.83% higher than the previous week. Maintaining high at 1.3549 and low at 1.3390 showed a movement of 159 pips.

In the upcoming week we expect GBP/USD 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 1.3579 may open a clean path towards 1.3643 and may take a way up to 1.3738. Should 1.3420 prove to be unreliable support, the GBPUSD may sink downwards 1.3325 and 1.3261 respectively. Chart formation of ascending scallops pattern in H4 chart favors prospects of a bullish trend. Hammer pattern formation escalates the expectation for a bullish trend.

Preference
Buy: 1.3515 target at 1.3642 and stop loss at 1.3415

 

Alternate Scenario
Sell: 1.3415 target at 1.3262 and stop loss at 1.3515

EUR/USD Weekly Forecast (3rd January 2022 – 7th January 2022)

Fundamental view:

The Euro initially fell in the week but then turned around and closed the week with a bullish candle. In the last week, European Central Bank Governing Council member Klaas Knot noted that the ECB could end its bond-buying program earlier than planned if inflation continues to surprise to the upside. Knot further argued that it was appropriate for the ECB to prepare for gradual monetary policy normalization. On the other hand, There seems a certain amount of mistrust as to whether or not the Federal Reserve is actually going to be able to tighten monetary policy for very long. Market also seems to move towards riskier assets in hope of fewer hospitalizations due to the new variant of Covid, dubbed as Omicron.

In this week, CFTC EUR Non-Commercial Net Positions on 27th December favored bearish outlook whereas Eurozone retail sales yearly report on 28th December, US EIA Crude Oil Stocks Change on 29th December and Eurozone CPI monthly report on 30th December favored bullish outlook.

The major economic events deciding the movement of the pair in the next week are OPEC Meeting, Eurozone Unemployment Change, US ISM Manufacturing PMI at Jan 04, US ADP Nonfarm Employment Change, EIA Crude Oil Stocks Change, FOMC Minutes at Jan 05, Initial Jobless Claims at Jan 06, Eurozone Retail Sales monthly report and US Nonfarm Payrolls at Jan 07.

EUR/USD Weekly outlook:

Technical View:

Last week’s high was 0.38% higher than the previous week. Maintaining high at 1.1386 and low at 1.1273 showed a movement of 113 pips.

In the upcoming week we expect EUR/USD 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 1.1410 may open a clean path towards 1.1455 and may take a way up to 1.1523. Should 1.1297 prove to be unreliable support, the EURUSD may sink downwards 1.1229 and 1.1184 respectively. Chart formation of a diamond pattern breakout upside in H4 chart sets prospects for a bullish trend. Invert hammer formation in H4 chart escalates the expectation for a bullish trend.

Preference
Buy: 1.1365 target at 1.1454 and stop loss at 1.1292

 

Alternate Scenario
Sell: 1.1292 target at 1.1185 and stop loss at 1.1365

Top Prediction of Bitcoin in 2022

Considering all things, The king crypto – Bitcoin had a pretty good year by facing both ups and downs. Bitcoin is up nearly 70% since the start of 2021 which drives the entire crypto market to a combined $2 trillion in value.

Some important milestones that has to be noted in this year are the approval of the first U.S. exchange-traded fund linked to bitcoin, first major crypto company go public –  Coinbase in April and the increased participation from Wall Street banks like Goldman Sachs

On the other hand, regulatory scrutiny has impacted bitcoin’s adversely. That said, experts also warn the market might be heading toward a downturn.

With the New Year rapidly approaches, people are eager to know on how bitcoin will behave in the upcoming year 2022. Now lets have a look on what experts predicts about Bitcoin next year.

Analyst predict Crypto crash

Several analysts take a stance on the fall of the Bitcoin in 2022.

Analysts  say 2021 is the year of cryptocurrencies. Bitcoin price skyrocketed by around 70%, and the entire crypto market gained a combined approximate of $2 trillion in value. Although it was a great success for the Bitcoin, experts believe that a price crash is inevitable in 2022. One of them even argued that Bitcoin value could go as low as $10,000.

According to Carol Alexander, professor of finance at Sussex University says Bitcoin is no more than a “toy” investment, since it “has no fundamental value.” She also added history is set to repeat itself, citing the Bitcoin trade in 2018 when it dropped close to $3,000 after reaching a $20,000 high.

She also pointed at that coins like Ethereum, Solana, Polkadot and Cardano might eventually replace Bitcoin in 2022.

As per CNBC, She said “as retail investors begin to realize the dangers of trading bitcoin, especially on unregulated venues, they will switch to… other coins belonging to blockchains which actually serve an essential and fundamental role in decentralized finance.” Todd Lowenstein, chief equity strategist of Union Bank’s private banking arm said “Without question, Bitcoin’s price chart appears to track many historical asset bubbles and busts and is carrying a ‘this time it’s different’ narrative just like other bubbles.”

Expectation of Regulatory crackdowns

Regulators globally are cracking down on cryptocurrencies. Global regulators worry the rise in privately operated currencies could undermine their control of the financial and monetary systems, increase systemic risks, promote financial crime and hurt investors.

China, the world’s largest crypto market, banned all transactions in September. Meanwhile, the U.S. authorities cracked down on certain aspects of the crypto market. Elsewhere, In India, the government has worked on a legislation to regulate use and trading of cryptocurrencies.

Also Bank of England policymakers led by Andrew Bailey have warned of the dangers of investing in such assets. 

Analysts widely expect regulation to be a key issue which will be faced by Bitcoin in 2022 .

Central banks are also looking at launching their own digital currencies, which would be negative for crytpo as these could usurp some of the perceived benefits of Bitcoin, such as speed of payments and transaction costs, particularly across borders.’

Bitcoin Strategy ETF

Approval of the first Bitcoin exchange-traded fund in the U.S is another factor that cannot be ignored. As ETF might be risky for novice traders, and the overall market might be erratic during the trade.

According to Vijay Ayyar, vice president of corporate development and global expansion at crypto exchange Luno, the Bitcoin Futures ETF could involve rolling over contracts that amount to 5 to 10 percent of the total shares.

‘DeFi’ growth to continue

It is worth noting that a lot of investors are getting interested in Emerging crypto developments such as decentralized finance (DeFi) and decentralized autonomous organizations more than Bitcoin’s system. That said, DeFi services surpassed $200 billion this year, which indicates a strong support among investors and experts predict its demand to grow further in 2022.

Future of Bitcoin

Irrespective of concerns over regulation and volatility, Still there is excitement brewing about the Bitcoin on what the future will bring.

Some favorable comments gives optimistic outlook towards the Bitcoin. Twitter boss Jack Dorsey caused a stir on the social networking site he helped to found by sharing his thoughts on Bitcoin. Mr Dorsey, who recently left his job as chief executive of Twitter to focus on a blockchain oriented Fintech company, tweeted that he thinks bitcoin will eventually replace the US dollar.

All the factors paired up with regulatory rules are expected to work as major catalysts on Bitcoin’s trading value. However, as previously mentioned, Bitcoin is highly volatile, so it is hard to determine whether these predictions would prove true.