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• The Bank of Japan has once again remained anchored to its easy monetary stance, frustrating bond traders who had been poised to profit from an about-turn in Yield Curve Control policy, the Japanese Yen shed 2% as the Nikkei ascended by a similar amount. The BoJ stated its intention to continue to purchase bonds at whatever amounts required to maintain the much-maligned 0% yield on 10-year JGB, hence, the trading band is maintained at -0.5%/+0.5%, the central bank has deployed billions to defend the ceiling in recent trading sessions, the 10-year yield retreated from a high of 0.51% back towards 0.35% on the announcement. 
• Market watchers now see the BoJ left having to purchase record amounts of domestic debt, essentially making them the prime source of liquidity backstopping the debt markets, this move may be considered a last-chance saloon scenario for investors still holding JGB exposure, to exit at reasonable levels before the appointment of a new BoJ Governor and an official reorientation in the Yield Curve Control strategy.
• UK CPI inflation data released earlier this morning showed that inflation pulled back to front the peak of 10.7% to print 10.5% in December in line with market expectations, the majority of the retreat is attributed to the decline in petrol prices, market watchers now look for further declines in food and energy prices next month as the UK market begins to aline with other developed economies, looking past the peak in inflationary pressures, however, the UK economy continues to witness a very tight employment market and general domestic pressures remain stubbornly elevated, this combination will likely keep the Bank of England on course for its tenth consecutive rate increase at its next meeting.
• In the Eurozone investor focus this morning will be the final print for December inflation data which is expected to confirm a back-to-back monthly decline in consumer prices, however, recent rhetoric from European Central Bank officials suggests they have set a course for further restrictive monetary policy, with markets currently pricing another 50bps move at the February meeting
• In the US all eyes will be on retail sales and industrial production data both of which are expected to show continued weakness, industrial production is set to have taken a hit from significant winter storms seen stateside. On the retail sales side of the ledger, weakness is expected to be driven by record declines in the used car sales market. The US data slate is rounded out today with Producer Prices data which is expected to follow CPI’s lead and show a build in disinflationary pressures for Producers, investors will have one eye on the wires as Fed officials are set to make further remarks today. 
• Markets-wise, investors will continue to monitor moves in the bond markets and the JPY remains in focus, the US 10yr continues to rotate around the 3.5% with the Dollar Index anchored around the 102 handle. Commodity markets remain supported with many investors eyeing the breakout in WTI Crude taking out resistance at the $80 a barrel level, $83.50 is the next level of interest, Gold continues to shine, and bulls will be looking for the yellow metal to remain supported above 1890 for a move to test 1950 next!
   

Overnight News of Note

• Asian Shares Mixed After BoJ Keeps Yield Policy Unchanged
• BoJ Holds Policy As It Pushes Back Against Market Speculation
• BoJ Introduces Latest Weapon To Defend Yield Control Policy
• Yen Slumps, Bond Futures Rising As Yield-Curve-Control Stays
• Goldman Sachs Lift China Economic Growth Forecast To 5.5%
• Bitcoin Has Now Recovered All Its Losses Since FTX Collapsed
• Oil Pushes Higher On Bets Chinese Demand Will Surge This Year
• Gold Slips As Dollar Gains Momentum, Focus On Data Releases
• Fed’s Barkin Says Too Soon To End Hikes As Inflation Lingering
• White House: No Debt Discussions After McCarthy Urges Talks
• US Sec Blinken: Iran Rejected Chance to Revive Nuclear Accord
• ECB’s Villeroy Says Resilient Economy Makes Rate Hikes Easier
• UK Pay Deals Steady For Second Month As Wages Lag Inflation
• Scholz Sees Germany Riding Out Ukraine War, Avoid Recession
• Apple Delays AR Glasses, Plans Cheaper Mixed Reality Headset
• Microsoft To Axe Thousand Of Jobs In Latest Cull By Tech Giant

(Sourced from Bloomberg, Reuters, and other reliable financial news outlets)
 

Technical & Trade Views

SP500 Bias: Bullish Above Bearish Below 3950 

• Primary support is 3950
• Primary objective is 4022
• Below 3940 opens 3890
• 20 Day VWAP bullish, 5 Day VWAP bullish

(Click on image to enlarge)

EURUSD Bias: Bullish Above Bearish below 1.0735

• Primary support  is 1.0735
• Primary objective is 1.09
• Below 1.0730 opens 1.0610
• 20 Day VWAP bullish, 5 Day VWAP bullish

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GBPUSD Bias: Bullish Above Bearish below 1.2230 - 123.15 Target Hit - New Pattern Emerging

• Primary support  is 1.2230
• Primary objective 1.2370
• Below 1.2140  opens 1.2080
• 20 Day VWAP bullish, 5 Day VWAP bullish

(Click on image to enlarge)

USDJPY Bias: Bullish above Bearish Below 132.30

• Primary resistance is 132.30
• Primary objective is 125.00
• Above 133.00 opens 135.00
• 20 Day VWAP bearish, 5 Day VWAP bearish

(Click on image to enlarge)

AUDUSD Bias: Bullish Above Bearish below .6920 - .7030 Target Hit, New Pattern Emerging

• Primary support is .6920
• Primary objective is .7090
• Below .6900 opens .6820
• 20 Day VWAP bullish, 5 Day VWAP bullish

(Click on image to enlarge)

BTCUSD Bias: Bullish Above Bearish below 20200

• Primary support 20200
• Primary objective is 22400
• Below 19900 opens 19300
• 20 Day VWAP bullish, 5 Day VWAP bullish

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