Weekly Technical Analysis For January 20th to 24th, 2020

All Eyes Will Be On ECB Rate Decision And Davos Summit This Week

EUR/USD:

The United States and China signed the first part of the trade agreement last Wednesday. The trade deal largely priced into markets. Trump said they are leaving tariffs on to allow more leverage in talks and all tariffs will come off when they finish the Phase2 deal.

On the other hand, the US inflation rose less than forecast in December. The core consumer price index, which excludes volatile food and energy costs, increased 0.1% in December from the prior month. Compared with a year earlier, the core CPI rose 2.3%, in line with estimates.

US producer price index slowed to a pace of 0.1%, below forecast for a 0.2% rise. In a yearly basis, the PPI rose by 1.3%.

Looking ahead, the ECB will announce its rate decision and forward guidance on Thursday. No change in monetary policy looks likely in the near future evidence that the central bank is shifting away from a dovish outlook may encourage greater demand for the single currency.

Keep your eye on the Davos summit of global business and political leaders in Switzerland. The event begins on Tuesday and we will get the World Economic Forum's annual global risk report. U.S. President Donald Trump will be also speaking at the forum.

The EURUSD pair showed a downward movement below the key level of 1.1114 last Friday. If the price stays below 1.1114, on a four hourly basis, the fall may continue and we will follow the support levels at 1.1052 and 1.1007. On the other hand, if the price goes beyond 1.1114, the next resistance level will be at 1.1165 again.

Support : 1.1052 - 1.0007 - 1.0965

Resistance : 1.1114 - 1.1165 - 1.1237

GBP/USD:

U.K. consumer inflation fell to a three-year low of 1.3% in December under the weight of electoral and Brexit-related uncertainty. 

The GBPUSD pair moved down below the 1.3046 main level. If the pair stays below 1.3046 on a daily basis, the daily support level can be seen at 1.2947. On the other hand, if the price goes beyond 1.3046, the next resistance level will be at 1.3136.

Support: 1.2947 - 1.2838 - 1.2768 

Resistance: 1.3046 - 1.3136 - 1.3231

USD/JPY:

Pay attention to the BoJ Monetary Policy meeting in the upcoming week. The BOJ is expected to keep the policy on hold next week. 

The USDJPY pair moved up above the 109.72 daily support level last week. If the upward movement continues, we will see 110.35  and 110.93 as resistance levels. On the downside, If the price falls below 109.72, we will follow the next support level at 109.39.

Support : 109.72 - 109.39 - 109.09

Resistance: 110.35 - 110.93 - 111.52

GOLD:

The Gold Price jumped back up above the daily support level of 1555. As long as the yellow metal price sustains above 1555 on a daily basis, the bullish action is most likely dominate and we will see 1575 as a resistance level. Otherwise, if the price breaks down below the 1555 main support level, the next support level will be at 1540.

Support: 1555 - 1540 - 1524

Resistance: 1575 - 1604 - 1642

19 Jan 20 (Sun)

08:05 pm


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