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On December 31st, South Koreas consumer price index (CPI) rose 2.3% year-on-year in December, down from 2.4% in November. Core inflation rose at 2%, the same rate as in November. Both overall and core inflation rates remained near the Bank of Koreas 2% target. These figures suggest some easing of price pressures, but they are unlikely to prompt the Bank of Korea to resume monetary easing on January 15th. The continued rise in the housing market has raised concerns that soaring mortgage debt levels could trigger financial imbalances, making the central bank reluctant to take further stimulus measures. Furthermore, the cost of living is likely to continue rising. Earlier this month, authorities warned that rising food prices could push inflation higher than expected next year, although overall price pressures remain largely manageable.December 31st - The minutes of the Federal Reserves December meeting, released Tuesday, stated that a Fed survey showed respondents, overall, expected the Fed to purchase approximately $220 billion in short-term Treasury securities over the next 12 months, although there were significant differences in respondents estimates of the expected purchase size. Fed policymakers decided at their December meeting to begin purchasing short-term Treasury securities, believing that reserves in the financial system had fallen to a level considered "ample," reflected in rising short-term funding costs. The Fed stated it would purchase approximately $40 billion in short-term Treasury securities per month, gradually reducing the amount thereafter. To date, the Fed has purchased approximately $38 billion in short-term Treasury securities this month and will conduct two more such operations in January.December 31st - "According to sources, Samsung and SK Hynix have received US approval to export chip manufacturing equipment to China in 2026," Reuters reported on the 30th. This comes after the US temporarily eased restrictions on South Korean companies following the earlier revocation of export license exemptions for some technology companies regarding chip manufacturing equipment. The report stated that Samsung, SK Hynix, and TSMC previously benefited from the "Verified End User (VEU)" system, an exemption from the comprehensive US export restrictions on chip-related goods to China. Companies on the "VEU" list can import designated controlled items (including semiconductor equipment and technology) from the US without needing to apply for separate export licenses.December 31st - This weeks U.S. Energy Information Administration (EIA) weekly crude oil inventory report was delayed by several hours, highlighting the latest indication that layoffs at U.S. federal agencies are impacting data releases that are crucial to the market. This year, the EIA has laid off more than 100 of its approximately 350 employees. These layoffs and downsizing were driven by the U.S. Department of Government Efficiency, a plan previously led by Elon Musk. Scott Shelton, an energy expert at TP ICAP Group, stated that because the oil market is currently primarily influenced by geopolitical factors, traders are not paying as close attention to U.S. inventory levels as they used to when the report was released. This helps mitigate the impact of the data delay. "Theres a general indifference about this. Its just a helpless shrug at the inefficiency and unpredictability of the U.S. governments data after the government shutdown."On December 31, GigaDevice announced on the Hong Kong Stock Exchange that it plans to issue 28,915,800 H shares (subject to the exercise of the offering size adjustment right and over-allotment option) in Hong Kong, with an issue price not exceeding HK$162 per share. Trading is expected to commence on January 13, 2026.

The Dollar Index's Top-to-Bottom Reversal Indicates a Potential Momentum Shift

Drake Hampton

Apr 11, 2022 10:52

On Friday, the US Dollar fell versus a basket of foreign currencies after gaining more than 100 points for the first time in over two years. It reached a high of 100.20 during the session, its highest level since May 2020.

 

Despite the fact that it formed a potentially bearish closing price reversal top, it ended the week up 1.3 percent. Throughout the week, the dollar index was mostly supported by a rise in US Treasury yields and a weaker Euro.

 

The June US Dollar Index closed at 99.753 on Friday, down 0.007 or -0.01 percent. The Invesco DB US Dollar Index Bullish Fund ETF (UUP) closed at $26.68, an increase of $0.01 or 0.02%.

 

On Friday, the US Treasury 10-year yield surpassed 2.7 percent for the first time in three years, aided by the likelihood of more aggressive Federal Reserve tightening. Additionally, this week's release of the Fed's March meeting minutes revealed that "many" members were prepared to raise rates in future months in 50-basis-point increments.

 

In other news, the Euro was under pressure as the election battle between President Emmanuel Macron and far-right contender Marine Le Pen tightened in France, the Euro Zone's second-largest economy. Macron continues to lead polls.

Technical Analysis of the Daily Swing Chart

According to the daily swing chart, the primary trend is upward. However, Friday's closing price reversal top implies that momentum is about to move downward.

 

A move above 99.745 will confirm the price reversal top at the close. This could initiate a 2-3 day adjustment. A break of 100.200 will invalidate the chart pattern and suggest the resumed uptrend. The primary trend will revert to the downside upon a break of 97.730.

 

Minor values range from 97.730 to 100.200. The nearest support level is at its 50% level, or pivot, of 98.965.

 

The critical support level is the long-term Fibonacci retracement level around 98.200.

Scenario of the Bear

Persistent movement below 99.975 indicates the existence of sellers. Taking out 99.745 will confirm the price reversal top at the close. If this generates sufficient downside momentum, expect the selling to extend towards the minor pivot at 98.965.

Scenario of Bullishness

Sustaining a move over 99.975 indicates the presence of buyers. The initial objective on the upside is 100.200.

 

If 100.200 is breached, the closing price reversal top will be invalidated, signaling the resumption of the uptrend. If buying is sufficiently strong, we may see an acceleration to the upside, with the next big objective of 100.560 – 100.930.

 

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