Topic: Trade Bitcoin with FreshForex - page 2. (Read 4365 times)

The Japanese Yen (JPY) is slightly lower against its US counterpart during the Asian session and erodes some of the recent strong gains to a five-week high reached the previous day. In the absence of a fresh fundamental catalyst, the JPY's intraday decline is likely to remain limited amid speculation that the Bank of Japan (BoJ) may raise interest rates again in December. Additionally, tariff threats from US President-elect Donald Trump and geopolitical risks could support the safe-haven JPY.

Expectations that Scott Bessent - Trump's nominee for US Treasury Secretary - will rein in the budget deficit have driven the benchmark US 10-year Treasury bond yield to levels not seen in a month.

At the same time, traders cut so-called “Trump trades” following the appointment of Scott Bessent as U.S. Treasury Secretary. Meanwhile, US macroeconomic data released on Wednesday did little to dampen market expectations that the Federal Reserve (Fed) would cut borrowing costs by 25 basis points in December. This led to a further decline in US Treasury bond yields, causing the US dollar (USD) to fall to a two-week low and may favor the low-yielding yen ahead of the release of inflation data in Tokyo on Friday.

Trading recommendation: Trading mainly with Buy orders from the current price level.

The Pound-Dollar pair is trading on a stronger note near 1.2570 on Wednesday in the early European session. The Pound Sterling (GBP) is strengthening despite US President-elect Donald Trump announcing new tariff measures. Traders are awaiting the release of October's Core PCE (US Personal Consumption Expenditure) price index to give it a fresh boost.

Early Tuesday, Donald Trump promised to impose tariffs on all goods imported into the US from Canada, Mexico and China, which led to the dollar's rally against the pound sterling in the previous session. The dollar's rally will pause on Wednesday as traders await US core PCE inflation data for more information on the outlook for interest rates. Meanwhile, the U.S. Dollar Index (DXY), which measures the value of the dollar against a basket of currencies, is currently trading near the lower end of its weekly range around 106.85.

Most Bank of England (BoE) policymakers support a gradual approach to policy easing. Bank of England Deputy Governor Claire Lombardelli said on Tuesday that she needed to see more evidence of cooling price pressures before she would support another interest rate cut. The betting that the UK central bank will cut interest rates next month is providing some support for the British pound at the moment.

Trading recommendation: Watch the level of 1.2550, if consolidated below consider Sell positions, if rebounded consider Buy positions.

On Monday, the EUR/USD attempted to consolidate higher levels, retracing back to 1.0500 amid weaker greenback trading in the broad market as investors returned to risk-on sentiment, albeit with limited effect. Please be aware that overall market flows will be limited this week. This is due to the second half of the weekly sessions in the US market being affected by the upcoming Thanksgiving holiday on Thursday and limited market hours on Friday.

The majority of EU data releases are expected to be relatively sparse this week, with the exception of a new round of European Harmonised Index of Consumer Prices (HICP) inflation data, scheduled for release on Friday. Preliminary EU HICP inflation data for November is expected to show an increase on a year-on-year basis, a trend that European Central Bank (ECB) policymakers are seeking to counteract. According to ECB officials, the near-term rise in broad EU inflation figures should not be a cause for concern for investors.

The minutes of the latest Federal Open Market Committee (FOMC) meeting will be released later on Tuesday, providing insight for traders on the Federal Reserve's (Fed) deliberations on the direction of interest rates going forward. On Wednesday, another update to the Personal Consumption Expenditure Price Index (PCEPI) will be released, which is a key indicator of price growth in the US economy. On Wednesday, the latest figures for US gross domestic product (GDP) growth will be released. The annual core PCEPI inflation rate is forecast to rise from 2.7% to 2.8% in October. US GDP growth in the third quarter is expected to remain at 2.8% quarter-on-quarter.

Trading recommendation: We follow the level of 1.0500, when fixing above it we consider Buy positions, when rebounding we consider Sell positions.

Lower U.S. bond yields are driving profit taking in the dollar and favoring the yen.The U.S. dollar, which has risen for eight consecutive weeks, is retreating from its highest level since November 2022 as traders opt to lock in profits after an explosive rally following the U.S. election.

Despite stronger Japanese consumer inflation data and statements from BOJ Governor Kazuo Ueda, domestic political uncertainty may prevent the BOJ from tightening monetary policy.

The Japanese yen (JPY) is strengthening against its U.S. counterpart at the start of the new week. US Treasury bond yields fell sharply in response to the nomination of Scott Bessent as US Treasury Secretary. This, in turn, prompted traders to ease their bullish bets on the US Dollar (USD) after its recent rally to a two-year high and directed some flows towards the lower-yielding JPY.

Nevertheless, uncertainty surrounding the Bank of Japan's (BoJ) rate hike plans, along with the prevalence of risk, could prevent any meaningful appreciation in the safe-haven JPY. In addition, expectations that US President-elect Donald Trump's policies could lead to a resurgence in inflation and limit the Federal Reserve (Fed) from slowly cutting interest rates could be a tailwind for US bond yields. This, in turn, favors dollar bulls and should provide support to the USD/JPY pair.

Trade recommendation: Trading mainly with Buy orders from the current price level.

According to a survey of economists by Reuters, the U.S. is considering imposing nearly 40% tariffs on Chinese imports early next year. Such measures could slow the growth of the world’s second-largest economy by 1%. Economists polled by the publication, both Democrats and Republicans, believe these changes will trigger massive disruptions in the U.S. and global economies, surpassing the impact of the trade wars during Trump’s first term. They warn this could ignite a “global trade war.”

During his presidential campaign, Donald Trump promised significant tariffs on Chinese goods as part of his “America First” trade policy. These potential tariffs, much higher than the 7.5%-25% rates of his first term, come at a vulnerable time for China’s economy, which is grappling with a prolonged real estate slump, debt risks, and weak domestic demand. Most economists predict Trump will impose the tariffs in early 2025, with an average estimate of 38% and projections ranging from 15% to 60%. These tariffs are expected to reduce China’s economic growth in 2025 by about 0.5-1.0 percentage points.

What could Trump’s policy lead to?

• Chinese indexes: Chinese stock indexes like #ChinaA50 and the Hang Seng Index (#HSI) are expected to face downward pressure.

• Chinese corporations: ey sectors such as electronics, automotive, and textiles—heavily reliant on exports to the U.S.—are likely to suffer the most. Major Chinese corporations, including #Alibaba and other leading players, could see their stock values decline.

• U.S. Indexes: American indexes like #SP500 and Dow Jones (#DJI30) might experience short-term volatility. Tariffs will raise costs for U.S. companies dependent on Chinese supplies, such as those in tech, automotive, and consumer goods sectors—companies like #Apple, #Tesla, and #Nike may face increased production costs. This could reduce profitability and potentially lead to stock corrections.

In the long term, however, the U.S. might benefit from the trade war, as it could boost domestic production, positively impacting American manufacturing stocks. FreshForex analysts predict a growth phase to begin in late Q1 2025. At the same time, on November 14, investors sharply increased short positions in Asian currencies following Trump’s tariff announcements.

The pound sterling gave up ground on the back of a poor British news calendar. Pound traders are expecting a tight data schedule on Friday.

GBP/USD lost another four-tenths of a percent on Thursday, hitting six-month lows, as underlying weakness in the pound sterling leads the pair further down against the US dollar. Market pressure is building ahead of Friday's key data due for release shortly, capping off this modest week.

Friday will begin with the release of UK retail sales data for October. UK retail sales are expected to have contracted 0.3% m/m compared to September's 0.3%. On a year-on-year basis, UK retail sales growth will decline to 3.4% y/y from the previous figure of 3.9%.

Global Purchasing Managers' Index (PMI) business activity figures will be released on Friday on a rolling basis, with PMI data to be released on both sides of the Atlantic. The UK Manufacturing PMI for November is expected to be unchanged at 49.9, just below contraction, while the UK Services PMI is forecast to rise to 52.1 from 52.0.

Median market forecasts for the U.S. portion of Friday's PMI release schedule suggest a general increase in activity expectations, with the November U.S. manufacturing PMI expected to rise to 48.8 from 48.5. The services PMI component of the PMI will also increase to 55.3 from 55.0.

Trading recommendation: Watch the level of 1.2570, when fixing above it consider Buy positions, when rebounding consider Sell positions.

The Euro-dollar pair gained slightly after losses in the previous session, trading around 1.0550 during Asian hours on Thursday. However, the pair's gains may be tempered by safe-haven flows amid escalating geopolitical conflict between Russia and Ukraine.

Reuters reported that Ukraine fired a salvo of British Storm Shadow cruise missiles at Russian territory on Wednesday, marking the latest use of Western weapons against Russian targets. Moscow said the use of Western weapons to strike Russian territory far from the border would significantly escalate the conflict.

European Central Bank (ECB) Governing Council member Yannis Stournaras said on Wednesday that the eurozone is close to sustainably achieving its 2% inflation target. Stournaras emphasized the responsibility of policymakers to keep inflation from falling below that target, Bloomberg reported.

Meanwhile, the EU Financial Stability Review noted that escalating geopolitical tensions and policy uncertainty are increasing the vulnerability of sovereign states, while growing global trade disputes are raising the risk of economic turmoil.

The ECB has cut rates three times since June as inflation approaches the 2% target. However, growth forecasts have been revised downward twice. Markets widely expect a 25 basis point rate cut next month, with a lesser likelihood of a more substantial cut.

The US Dollar (USD) received support from cautious remarks from Federal Reserve (Fed) officials. FRB Boston President Susan Collins said on Wednesday that while further interest rate cuts are necessary, policymakers should proceed cautiously to avoid moving too fast or too slow, according to data compiled by Bloomberg.

Trading recommendation: Watch the level of 1.0550, if the level is fixed above consider Buy positions, if the level rebounds consider Sell positions.

On Tuesday, the Japanese Yen (JPY) demonstrated robust two-way price movements, with minimal fluctuations against its US counterpart by the end of the trading day. Russia's announcement that it will lower the threshold for a nuclear strike has prompted a flight to safety into the Japanese Yen. The global flight to safety resulted in a significant decline in US Treasury bond yields, which further impacted the low-yielding yen. This led to the USD/JPY pair reaching a weekly low of around 153.30-153.25. However, the initial market reaction diminished rather rapidly following comments from Russian and US officials that helped assuage concerns about the potential for a full-scale nuclear war.

Furthermore, the timing of further monetary tightening by the Bank of Japan (BoJ) continued to create uncertainty and overshadow the modest weakening of the US dollar (USD). Following the release of Japan's trade balance data, the Yen remains under pressure, with the USD/JPY pair consolidating on the solid intraday recovery of more than 150 pips achieved overnight. Nevertheless, speculation that Japanese authorities may intervene in the FX market to support the local currency, coupled with geopolitical uncertainty, may deter those betting against the Japanese yen and serve as a headwind for the pair.

Trade recommendation: We follow the level of 155.00, when fixing above it we consider Buy positions, when rebounding we consider Sell positions.

UK CPI inflation data will be released mid-week.

GBP/USD rose 0.5% on Monday, kicking off the new trading week with a bullish recovery that ended a six-day losing streak and trimmed recent losses, sending price action back towards 1.2700. The rise in quotes is attributed to a general easing of the US dollar's lopsided momentum rather than the inherent strength of the pound. Pound sterling traders are lurking in anticipation of fresh inflation data (consumer price index) in the UK this week.

The Bank of England (BoE) will warm up the market on Tuesday as the UK central bank is scheduled to hear the latest monetary policy report, but GBP traders will focus on the UK Consumer Price Index for October released on Wednesday. Markets are forecasting that UK annual CPI inflation will accelerate to 2.2% y/y in October from a previous reading of 1.7%, while UK core CPI is expected to remain unchanged at 3.2% y/y.

Markets are getting a nice respite from important economic data from the US this week, but traders should keep an eye on Friday's UK retail sales data as well as the S&P Purchasing Managers' Index (PMI) data due for release to round out the trading week.

Trading recommendation: Trade mainly with Buy orders from the current price level.

The Euro-dollar pair traded near 1.0550 during Monday's Asian trading session, staying close to the yearly low of 1.0496 reached on November 14. The pair's downside risks intensified after cautious comments from Federal Reserve (Fed) officials and stronger-than-expected US retail sales data, which provided broad support for the US dollar (USD).

Last week, Fed Chairman Jerome Powell tempered expectations of an imminent rate cut by emphasizing the resilience of the economy, a strong labor market and continued inflationary pressures. Powell stated, “The economy is not signaling that we need to rush to cut rates.”

The CME FedWatch Tool shows that markets are pricing in a nearly 60 percent probability of a 25 basis point Fed rate cut at the December meeting. The Euro continues to face downward pressure as the European Central Bank (ECB) maintains a dovish stance with a rate cut expected at its upcoming December meeting. Core inflation in the eurozone is projected to fall sharply to 2.4% in 2024 from 5.4% in 2023, before gradually declining to 2.1% in 2025 and 1.9% in 2026.

The European Commission's fall forecast for 2024 assumes the euro area economy will grow by 0.8% in 2024, unchanged from the spring forecast. However, the growth forecast for 2025 has been revised down slightly to 1.3% from 1.4%, and the eurozone economy is forecast to grow by 1.6% in 2026.

Trading recommendation: Trade predominantly with Sell orders from the current price level.

The Japanese Yen (JPY) extends its losing streak against the US Dollar (USD) for the fifth consecutive session following the release of Japan's Q3 Gross Domestic Product (GDP) data on Friday. The USD/JPY pair's upside potential is supported by a strong US Dollar (USD). Traders are also preparing for the release of US retail sales data for October, due later on Friday.

Japan's preliminary gross domestic product (GDP) data for the third quarter rose 0.2% quarter-on-quarter, up from 0.5% in the previous quarter, matching market expectations. On an annualized basis, the country's GDP growth in the third quarter was 0.9%, beating the market consensus forecast of 0.7%, but showing a sharp slowdown from the 2.2% growth recorded in the second quarter.

Japan's Finance Minister Katsunobu Kato said on Friday that he will take appropriate measures against excessive currency fluctuations. Kato emphasized the importance of stable exchange rate movements reflecting economic fundamentals and expressed concern about unilateral sharp fluctuations in the market.

Meanwhile, Japan's Economy Minister Ryosei Akazawa said he expects the moderate economic recovery to continue, fueled by rising employment and wages. However, Akazawa also emphasized the need to keep a close eye on potential downside risks to the global economy and volatility in financial and capital markets.

Trade recommendation: Trade predominantly with Buy orders from the current price level.

GBP/USD extends its decline to 1.2685 in Asian trading hours on Thursday. The US dollar (USD) rally to the highest level since November 2023 is putting pressure on the major pair. Later on Thursday, Bank of England (BoE) Governor Andrew Bailey will deliver a speech.

Data released by the US Department of Labor Statistics on Wednesday showed that the US Consumer Price Index (CPI) matched expectations, rising 2.6% year-on-year in October. Meanwhile, the core CPI, which excludes the more volatile food and energy categories, rose 3.3% y/y in October, matching the forecast. Markets expect the U.S. Federal Reserve (Fed) to continue cutting rates at its next meeting in December.

“The Consumer Price Index offered no surprises, so for now the Fed will continue to cut rates in December. However, next year is a different story given the uncertainty surrounding potential tariffs and other Trump administration measures,” said Ellen Zentner, chief economic strategist at Morgan Stanley Wealth Management.

Fed officials remain cautious about cutting rates. On Wednesday, Dallas Fed Chairwoman Laurie Logan said the U.S. central bank should be cautious about further interest rate cuts so as not to inadvertently ignite inflation. In addition, St. Louis Fed President Alberto Musalem said stagnant inflation figures make it difficult for the U.S. central bank to cut rates further. Traders are raising bets on another quarter percent rate cut in December, albeit at a slower pace, before mid-2025.

Trading recommendation: Trading mainly by Sell orders from the current price level.

The Japanese yen (JPY) hit a new low since July 30 against its US counterpart during Wednesday's Asian session, although it managed to defend the psychological 155.00 mark. Despite a rise in Japanese producer prices in October, investors seem convinced that an unstable minority government in Japan could make it difficult for the Bank of Japan (BoJ) to raise interest rates further. In addition, concerns that tariffs promised by U.S. President-elect Donald Trump could significantly impact Japanese exports proved to be a key factor undermining the yen.

In addition, expectations that Trump's inflationary import tariffs could limit the Federal Reserve's (Fed) ability to cut interest rates continue to support elevated US bond yields. This further exacerbates the low-yielding Yen, which, along with the bullish US Dollar (USD), acts as a tailwind for the USD/JPY pair. Meanwhile, the recent drop in JPY raises the possibility of intervention from the Japanese authorities. This could deter JPY bears from making new bets ahead of the release of US consumer inflation data later this Wednesday.

Trade recommendation: Trading mainly by Buy orders from the current price level.

In recent days, the cryptocurrency market has experienced a surge in interest following Donald Trump’s election, as he aims to make the United States a global crypto industry leader. His plans to dismiss Gary Gensler, the Chair of the Securities and Exchange Commission (SEC) known for his stringent digital asset regulations, have had a noticeable impact on the market. As a result of this news, Bitcoin (BTCUSD) hit a new record, temporarily reaching $89,600.

At the same time, U.S. indices staged an impressive rally, breaking records: the S&P 500 (#SP500) surged 4.66% over the week, crossing the $6,000 mark, while the Dow Jones Index (#DJI30) jumped 5.23% at its peak, exceeding $44,300!

Investor optimism is tied to a 25-basis-point rate cut by the Fed, as inflation approaches the target rate of 2% (2.4% in September), along with expectations of corporate tax reductions and regulatory easing under President Donald Trump. Several factors are aligning for further growth across the American market:[/li][/list]

• Financial services sector: U.S. bank stocks are rising with Trump’s victory, as his promises to reduce inflationary pressures and provide tax benefits are already yielding results. Shares of major banks have shown growth of 10% to 13%! Among the top gainers: Goldman Sachs (#GoldmanSac), Bank of America (#BankAmer), Morgan Stanley (#MorganStan), and JPMorgan (#JPMorgan). All are available in our trading terminal!

• Support from the Fed: On Thursday, the Central Bank cut interest rates by a quarter-point. Fed Chair Jerome Powell noted in a press conference that the U.S. economy “is in good shape.” As reported by CNBC, investors generally see a Republican-controlled government as more favorable.

• Trump rally: The SP500 and DJI30 posted their best week since November 2023. Several Trump-related stocks have once again shown solid performance. Tesla (#Tesla), whose CEO Elon Musk was involved in the newly elected president’s campaign, rose by 8.2%, marking four consecutive positive sessions.

• Analyst predictions: The Republican victory has pushed U.S. Treasury yields to a four-month high of 4.5%, while bank and tech stocks are climbing. Major analytical agencies are confident that, following reforms by the current U.S. president, the market will gain even more momentum. FreshForex analysts have repeatedly forecasted the rise of indices and cryptocurrencies and remain confident in the upcoming growth of the entire U.S. market!

GBP/USD continues to decline to the 1.2840 level in the early European session on Tuesday. The US Dollar remains resilient amid the ongoing Trump trade. Investors will be keeping a close eye on UK employment data due for release later on Tuesday.

Last week, the Bank of England (BoE) decided to cut interest rates by 25 basis points (bps), bringing the bank's key rate to 4.75%. Bank of England Governor Andrew Bailey told a press conference that the U.K. central bank needs to maintain a “gradual approach” to policy easing.

UK employment data on Tuesday will be closely watched as it could provide some hints on the Bank of England's policy decision at its December meeting. The UK unemployment rate for the three months through September is expected to rise to 4.1% from 4.0% in the quarter ended August.

In addition, average wages excluding bonuses are forecast to rise by 4.7%, up from 4.9% previously, and average wages including bonuses are forecast to rise by 3.9%, up from 3.8% previously published. If the report comes in stronger than expected, this could provide support for the Pound Sterling (GBP) against the US Dollar.

As for the US Dollar, the likelihood that the Trump administration will propose policies including stiff tariffs, tax cuts and Federal Reserve monetary policy intervention could boost the Dollar and bond yields. Fed officials are likely to increase their cautious tone this week and traders will be more focused on the release of Consumer Price Index (CPI), Producer Price Index (PPI) and US retail sales reports later this week.

Trading recommendation: Trade predominantly with Sell orders from the current price level.

The Euro-dollar pair continues to experience downward pressure for the second consecutive session, hovering around 1.0720 during Asian trading hours on Monday. The pair is pressured by the strengthening US dollar (USD) and political uncertainty in Germany.

Investors are expecting a less soft stance from the Federal Reserve as Donald Trump is likely to continue to fulfill his campaign promises to impose significant tariffs, including a 10 percent hike on imports and corporate tax cuts.

Analysts believe that if Trump's fiscal policies are implemented, they could lead to an increase in investment, spending and labor demand, raising inflation risks. This could prompt the Fed to adopt a tighter monetary policy, potentially strengthening the US dollar and putting additional pressure on EUR/USD.

However, Fed Chairman Jerome Powell said on Thursday that he does not expect Trump's potential return to the White House to affect the Fed's policy decisions in the near term. “We are not guessing, speculating, or assuming what future government decisions will be,” Powell said after the bank decided to cut interest rates by 25 basis points to a range of 4.50%-4.75%, as expected.

On Friday, the University of Michigan's preliminary index of consumer sentiment rose to 73.0 in November, up from 70.5 in October and above market expectations of 71.0. This favorable data generally strengthened the US dollar.

Trading recommendation: Trade predominantly with Sell orders from the current price level.

The Japanese yen (JPY) is depreciating against its US counterpart during the Asian session on Friday, reversing a recovery from its lowest level since 30 July. The latest data, released on Thursday, revealed a decline in real wages in Japan during September. This, coupled with the rising cost of living, is exerting downward pressure on household spending and could have an adverse impact on the inflation outlook. It is anticipated that this will result in the Bank of Japan (BoJ) postponing its plans for additional rate hikes, given the current domestic political uncertainty. This is likely to have an adverse impact on the value of the yen.

Furthermore, the prevailing risk-off sentiment is exerting downward pressure on the Japanese yen, which, along with the emergence of US dollar (USD) dip buying, is providing support to the USD/JPY pair. Nonetheless, the recent decline in the value of the yen has prompted the Japanese authorities to issue verbal intervention. Furthermore, the winding down of the Trump trade and the lack of hawkish signals from the Federal Reserve (Fed) serve as a headwind for US Treasury yields, which could deter those betting against the yen and limit the currency pair.

Trade recommendation: We follow the level of 153.00, when fixing above it we consider Buy positions, when rebounding we consider Sell positions.

Yesterday, November 6, 2024, the U.S. presidential election results were announced, and the race was won by Donald Trump, a strong advocate for cryptocurrency! During his campaign, on September 18, 2024, the current U.S. leader made a bold move toward the digital asset community by treating supporters to burgers at PubKey in New York, paid for in Bitcoin. During the voting and after the results were announced, Bitcoin (BTCUSD) demonstrated a rapid surge.

Starting around $68,000, Bitcoin broke past $76,000, hitting a historical peak and posting an impressive 12% gain within just 24 hours!

In addition to the support from the leader of one of the world’s top nations, cryptocurrency has plenty more cards up its sleeve. Key growth factors and expert insights:

• Institutional investor interest: Major corporations and institutional investors continue to increase their Bitcoin investments, supporting high demand and limited supply in the market. For example, well-known company MicroStrategy (#MSTR) acquired 5,445 BTC for $150 million from August through late September!
• Rising demand amid economic uncertainty: With inflation on the rise, geopolitical instability, and volatility in traditional markets, investors are seeking more stable assets. Bitcoin, alongside gold (XAUUSD), is becoming a preferred choice for capital preservation.
• Expectations of U.S. Fed policy easing: With potential interest rate cuts on the horizon, interest in cryptocurrencies as alternative assets is increasing. Experts estimate an 87% probability of a rate cut at the next meeting, creating additional incentives for investing in BTC and other crypto assets.
• Positive analyst forecasts: The projected minimum Bitcoin price in January 2025 is $71,468, with an average of $78,168 and a maximum of $80,402. By December, these figures are expected to rise to $106,235, $109,213, and $124,937, respectively. Growth is anticipated to remain steady, without declines or corrections, throughout the year.

On September 19, 2024, FreshForex analysts highlighted the undeniable growth drivers for the entire crypto sector. With Trump at the helm of the U.S., crypto growth is practically inevitable! Don’t miss your chance!

The GBP/USD pair saw some buying activity during the Asian session on Thursday, resulting in a move away from the lowest level since mid-August, around 1.2835-1.2830, which was reached the previous day. Spot prices are now aiming to consolidate above 1.2900 as market attention shifts to risks from key central bank developments.

The Bank of England (BoE) is scheduled to announce its policy decision later today. Market expectations are for a second interest rate cut this year, reflecting slowing inflation. However, expectations that UK Finance Minister Rachel Reeves' first budget will result in higher inflation and necessitate a more gradual reduction in interest rates have provided some support for the British pound (GBP). This, along with a modest decline in the US dollar, was the primary driver of the GBP/USD appreciation.

However, a notable correction in the dollar from Wednesday's four-month high appears unlikely in the context of optimistic expectations for higher growth and inflation under a second term of President Donald Trump. This could potentially lead to a reduction in the pace of interest rate cuts. The outcome of the two-day Federal Open Market Committee (FOMC) meeting, along with comments from Federal Reserve (Fed) Chairman Jerome Powell at the post-meeting press conference, will play a pivotal role in influencing the US dollar.

Meanwhile, the return of the so-called 'Trump trade' has kept US Treasury bond yields near multi-month peaks, which should serve as a tailwind for the dollar and limit GBP/USD's upside. It would therefore be prudent to wait for strong buying before confirming that spot prices have formed a short-term bottom.

Trading recommendation: Trading mainly by Buy orders from the current price level.

The Japanese yen reached a two-week high against the US dollar during the Asian session on Wednesday, following the release of minutes from the Bank of Japan (BoJ) meeting. The minutes indicated that the central bank plans to maintain its current pace of interest rate hikes, contingent on the accuracy of its economic and price forecasts. However, investors are of the opinion that the current political situation in Japan may present challenges for the BoJ in pursuing further monetary policy tightening. Furthermore, the prevailing positive sentiment towards risk is having an adverse effect on the safe-haven yen.

This, coupled with the surge in US dollar (USD) buying activity, driven by early polls indicating a potential victory for former President Donald Trump, led to a notable intraday recovery of approximately 150 pips in the USD/JPY pair. As the poll results are released to the media, the markets are expected to react in one way or another. This has prompted some more risk-averse traders to exercise caution before positioning the currency pair in a firm direction for the near term.

Trade recommendation: Trading mainly by Buy orders from the current price level.