Weekly Technical Analysis For January 11th to 15th, 2021

Keep Your Eye On US Inflation Data This Week

EUR/USD:

The US Jobs Report was a disappointing read throughout last week. Nonfarm Payrolls (NFP) in the US fell by 140,000 in December. This reading followed November's increase of 336,000 (revised from 245,000) and missed the market expectation of +71,000 by a wide margin.

Further details of the publication revealed that the Unemployment Rate stayed unchanged at 6.7% and the Average Hourly Earnings rose by 0.8% on a monthly basis, compared to an estimate of 0.2%. Finally, the Labor Force Participation Rate remained steady at 61.5%.

The US Dollar has been on the slide for months, with the central drivers being hopes of a global recovery, backed by the introduction of Covid-19 vaccines, backed by deeply negative U.S. real rates. 

Looking ahead, focus on the US CPI inflation figures on Wednesday. Consumer prices are expected to come out at 0.4% last month and 1.3% over the prior year, according to estimates. Excluding the cost of food and fuel, core inflation is projected to be 1.6% on a year-over-year basis.

Watch out for US Producer Price Index on Friday. The US PPI is predicted to come out at 0.8% year-on-year basis. While the Core PPI inflation is expected to be 1.4%. A higher than expected reading should be taken as positive for the US Dollar.

Moreover, US Retail Sales figures will be closely watched on Friday. Economists predict that retail sales be at -0.2% in December. On the other hand, Core retail sales, which exclude autos, are expected to have decreased by -0.1%.

The EURUSD pair closed last week just the 1.2214 main support level. As long as the pair stays above 1.2214, on a daily basis, we will follow 1.2391 and 1.2536 as resistance levels. Otherwise, if the price falls below 1.2214, we will see the next support level at 1.2046.

Support : 1.2214 - 1.2046 - 1.1819

Resistance : 1.2391 - 1.2536 

GBP/USD:

The GBPUSD pair stayed below the 1.3599 main resistance level last Friday. If the pair trades below 1.3599 on a daily basis, the fall may continue and we will see the support levels at 1.3517 and 1.3392. On the other hand, If the pair rises above 1.3599, the next resistance level is holding at 1.3688

Support: 1.3517 - 1.3392 - 1.3313

Resistance: 1.3599 - 1.3688 - 1.3784

EUR/JPY:

We are closely watching the main the 126.69 main support level in the EUR/JPY pair. As long as the price stays above 126.69, on a four hourly basis, we will follow the key resistance levels at 127.52 and 128.39. On the downside, if the pair drops below 126.69, the next major support level will be at 125.85

Support: 126.69 - 125.85 - 125.07

Resistance: 127.52 - 128.39 - 129.33

GOLD:

The Gold price showed a downward movement last Friday and dropped below the 1854 major resistance level. If the price stays below 1854, on a daily basis, the fall may gain more momentum and we will follow 1829 and 1805 as key support levels. Otherwise, if the price rises above 1854, the next daily resistance level can be found at 1873.

Support: 1829 -1805 - 1785

Resistance:  1854 - 1873 - 1904 

10 Jan 21 (Sun)

06:51 pm


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