Forex Signals Brief December 29: Spanish CPI and Chicago PMI to Close 2023

Yesterday started with some decent economic data from Japan, such as the Prelim Industrial Production, which despite declining in November, was better than expectations and the October figure was revised higher too. Retail Sales YoY posted a nice jump of 5.3%, also beating expectations, keeping the USD in demand, despite comments from the Bank of Japan that they’re not thinking about raising interest rates.

In the US session, Unemployment Claims came above expectations, at 218K, while Pending Home Sales remained flat in November, missing epxectations of 0.8%, although the USD made a comeback after being bearish all week. It pushed nearly 100 pips higher across the board, however, it’s hard to determine anything now as year-end cash flows dominate the markets until next week.    

Today is the last day of the year, so we might see some volatility on last-minute adjustments. The UK Nationwide House Price Index is expected to come at 0.1%, slowing from 0.2% previously, followed by the Swiss KOF Economic Barometer, which is expected to show a slight improvement by 2 points.

The Spanish FlashYoY CPI (consumer price index) inflation report is also expected to be released this morning, with anticipations of it remaining unchanged from the previous month at 3.2%. The Chicago PMI will close the last week of 2023 and it is expected to take a sharp turn downward, falling by more than 5 full points, however, this indicator is quite volatile.   

BTC/USD has been one of the top-performing assets this year, however, it is currently in a consolidation phase following a 160% increase. Despite adverse economic conditions, the value of Bitcoin has soared above $44 and is expected to outperform traditional investments. It began at $40,000 earlier this month, but buyers have been very active, maintaining the price optimistic overall. However yesterday we saw a decent pullback, but yesterday buyers returned again.

Following severe losses in the first two quarters of 2023 as it dropped from near $5,000, Ethereum has been attaining bigger highs, demonstrating that the trend has been positive for more than a year. For the most part, Ethereum has been consolidating between $1,100 and $1,400 this month, but it appears that the positive trend will resume, driving this pair higher as Ethereum prepares for the next upgrade. This week has seen a decline, although the 200 SMA appears to be holding as support.

• ETH Buy Signal
• Entry Price: $1,947.38
• Stop Loss: $1,490
• Take Profit: $2,500