Eur/GBP rises ahead of UK inflation

Eur/GBP held steady at 0.86 ahead of UK inflation data. Inflation is expected to moderate slightly in November but remain stable in double digits, with no real sign that the peak inflation has passed. This follows an acceleration in UK wage growth in October from a year earlier, up from 5.8 per cent. The combination of high inflation and rising wage growth is likely to put pressure on the Bank of England to continue raising interest rates aggressively to keep inflation in check, even as the economy heads for recession. The euro is gaining from stronger-than-expected German economic sentiment. The ZEW economic morale index improved for the third month in a row, with hopes for cooling inflation and stabilization in energy markets. The Bank of England and the European Central Bank will announce interest rate decisions tomorrow.

Where is the EUR/GBP price likely to go?

Eurgbp continues to trade relatively range-bound, with upside limited at 0.8645, the December high, and the 200 MA at 0.8550 downside. An RSI below 50 indicates that sellers will have more momentum. Sellers will be looking for a move below 0.8550 to extend the downside to the August 22 high of 0.85, ahead of 0.84, the round number and the level where multiple points have provided support throughout the year. At the same time, buyers may look to move above the 0.08660 resistance to expose 0.8670 at the 50 SMA. A break above this level could bring the multi-month uptrend line resistance at 0.87 back to the target.

BTC/USD rose to a monthly high

BTC/USD has risen to a monthly high of 17.8k, buoyed by the prevailing risk sentiment following the release of the US inflation data and ahead of the FOMC rate decision. The Fed's more dovish outlook is offsetting any lingering concerns in the wake of the FTX case, as former CEO Sam Bankman-Fried was formally charged with fraud in a U.S. court and denied bail. Binance withdrawals jumped after reports that U.S. prosecutors were also considering criminal charges against the exchange. Crypto-friendly bank Silvergate has also seen its share price plummet. However, thanks to an improving macro backdrop and hopes that the Federal Reserve is starting to slow interest rate hikes, Bitcoin and its peers have managed to weather another tumultuous 24 hours for the crypto industry.

The Nasdaq rose ahead of the FOMC meeting

The Nasdaq closed up 1 percent and rose again today after U.S. inflation cooled more than expected in November. CPI fell to 7.1 per cent year-on-year, down from 7.7 per cent in October and below expectations of 7.3 per cent. Core inflation was also lower than expected at 6 per cent, down from 6.3 per cent. The data, released ahead of today's Federal Open Market Committee (FOMC) rate decision, is not expected to change the Fed's plan to raise rates by 50 basis points after four consecutive meetings of 75 basis points. However, cooling inflation could affect interest rate rises next year. Investors will be watching closely for guidance in the coming year. A more dovish sounding feed could push the Nasdaq higher.

Support for the pair can be seen at 11400 (50 SMA) and 11060 (June low).

Resistance can be seen at 12215 (weekly high) and 12410 (200 SMA).