2022/12/25 (133) Technical Analysis

This Week No New Old 4XSetUp Trading Capability In The GBPUSD,
After We Were Stopped Out On Last Thursdays 2022/12/22 Trading Session!

On Thursday Our Long GBOUSD 4XSetUp Trading Capability Was Stopped Out
– With Our Entry Long Entry At 1.1278 On 2022/10/24 We Made A Profit Of 722 Pips
As The GBPUSD Pair Traded On Thursday, The 2022/12/22 Back Again Under 1.20 GBPUSD

I don’t want to get too greedy over the holidays. Since sales are also likely to be below average on the foreign exchange market. So let’s wait for the price action in GBPUSD first. And let’s revisit the movements of the last few weeks. To hopefully get an even better feel for future price action in GBPUSD again. However, the GBPUSD traded around the $1.21 level, last days, and/or even around 1.20$ on thursday, slightly down from a recent six-month peak of $1.2446, as investors weigh a less hawkish BoE and economic prospects. Policymakers in the UK delivered an expected half-percentage-point increase in interest rates on December 15th, the ninth in a row, but said inflation had peaked, suggesting there could be a pause in the current policy tightening next year. At the same time, both the Fed and the ECB raised interest rates by a half percentage point and signalled more would follow. Meanwhile, fresh figures showed the British economy shrank slightly more than expected in Q3, with household spending and business investment falling significantly, increasing expectations that the UK economy is heading towards a recession. Inflation fell to 10.7% in November, from a 41-year high of 11.1% in October, but remained well above the central bank’s target of 2%.

UK Stocks Little Changed Ahead Long Weekend,
While US WallStreet Close Higher After Friday Trading Session

The FTSE 100 closed little changed in a shortened session on Friday, after a 0.4% loss the day before with the energy sector leading gains. Also, auto stocks added 0.4% after the latest data showed UK car production rose 5.7% in November, the second straight month of increases. In corporate headlines, Hurricane Energy Plc rose 2.6% after activist investor Crystal Amber Fund sent a notice to the group to convene a general meeting proposing leadership change. On the week, the London index advanced almost 2%. The London Stock Exchange will be closed on Monday and Tuesday for the holidays.

The Dow Jones erased early losses and closed 170 points higher while the S&P 500 added 0.6% on Friday with support from energy shares, as investors continued to digest the latest economic data for hints on the Federal Reserve’s path. The core PCE price index, the Fed’s preferred inflation gauge, slowed more than the FOMC had forecasted in its projections last week. Meanwhile, personal spending edged higher from the prior month and durable goods orders shrank the most in two years. Still, concerns that the Fed will maintain its hawkish guidance for next year persisted after GDP growth and quarterly PCE inflation figures were revised higher yesterday, pressuring the tech-heavy Nasdaq to underperform and close marginally above the flatline. So far in December, the Dow Jones is down 4%, the S&P 500 shed 5.9%, and the Nasdaq tumbled 8.7%, with the three major averages on track for their worst yearly performance since 2008. Markets will be closed on Monday for the Christmas holiday.

UK 10-Year Bond Yield Up At End of Year And/Or Treasury Yields Hover At 3-Week High

The yield on the 10-year US Treasury note rose above the 3.7% mark, the highest in over three weeks as recent economic data releases backed the aggressively hawkish decisions and guidances by the Fed and other major central banks. The US economy expanded by 3.2% quarter-on-quarter in the three months leading to September of 2022, above earlier estimates of 2.9% and pointing to slightly better resilience since the Fed started its tightening cycle in March. Also, personal income levels remained robust in November. Still, cooler-than-expected PCE price data and spending levels for November limited further upswings for bond yields. In its last meeting, the FOMC increased projections for the federal funds rate to reach and stay at 5.1% in 2023 from prior estimates of 4.6%. Increased tightening momentum from other major central banks also pressured bond prices. Most notably, the BoJ unexpectedly widened the tolerance band on its 10-year JGB yield and the ECB signaled increased tightening. The yield on the UK’s 10-year Gilt surpassed 3.6% at the end of December, hovering around its highest level since October 24th, from about 1.0% at the beginning of the year amid increasing bond supply and fears that the global economy might head into a severe recession due to a hawkish rhetoric from major central banks. Policymakers in the US and Europe raised interest rates by a half percentage point this month, and signaled more would follow, while the Bank of Japan loosened its yield-curve control, which dictates the path of long-term interest rates. Locally, the Bank of England delivered an expected half-percentage-point increase in interest rates, the ninth in a row, but said inflation had peaked, suggesting there could be a pause in the current policy tightening next year. Recent data showed UK CPI inflation fell to 10.7% in November, from a 41-year high of 11.1% in October.In The Medium And Long Term, It Is Important
To Defend The Price Action Zone Between 1.1950 GBPUSD And/Or 1.414 GBPUSD

GBPUSD 1.4114 is a key technical as GBPUSD 1.414 marked the low during the early 2020 Corona virus outbreak. Vice Versa the provisional high at that time in the USD – just as a liquid parking opportunity (due to the shutdown of most economies in our so-called West). Personally, however, I perceive the 1.1950 GBPUSD price action area as even more important. Although I occasionally passionately like to discuss and/or argue about it with other colleagues, technical analysis nerds. And who now seem to be even more gifted Technical Analysts than I – which you’ve picked up most of the 4XSetUps from. But let that go – and come back to the 1.20 GBPUSD. Yes, to GBPUSD 1.20 – as on the one hand it is an important psychological price level. Even if it reads boring and unexciting – I know, for free! But I feel the focus on the 1.20 GBPUSD mark is all the more competent, since the GBPUSD exchange rate pair, in its more than 100-year history, was only traded during the Corona Virus outbreak, and or also during the departure of the last Prime Minister Boris Johnson . As well as rather during the line of succession to the royal family of the United Kingdom. As Queen Elizabeth II passed away on 09/08/2022. And since Charles III, of the House of Windsor, King of the United Kingdom of Great Britain and Northern Ireland and 14 other sovereign states, including their territories and dependent areas, known as the Commonwealth Realms, has been king. He is also head of the 56-state Commonwealth of Nations, liege lord of the British Crown Dependencies, secular head of the Anglican State Church and Commander-in-Chief of the British Armed Forces. So, if you will, a historical exception as far as GBPUSD is concerned around the 1.20 price action area. A historical volatile standard deviation, if you will. Which should sooner or later be found again in its own historical average value. Which in our case is medium term (just since 2017 more or less 1.28 GBPUSD). In the long term even GBPUSD 1,525 (just since the lows of 2008, after the collapse of the Lehman Brothers Bank in the USA and the financing crisis that has followed since)