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26.01.201810:24 Forex Analysis & Reviews: Trading plan for 26/01/2018

Long-term review

President Trump's words about the strength of the US Dollar gave fuel to strengthen the currency, but the Asian session brings another retreat. GBP, AUD and NOK are leading the rise; EUR / USD returns at 1.2450. Stock markets are undecided, Japanese Nikkei 225 fell 0.16% (under the pressure of a USD / JPY pull-back), but in China, the indexes are growing - Hang Seng + 1.5%.

On Friday 26th of January, the event calendar is quite busy with important news releases, so the market participants should keep an eye on M3 Money Supply data from the UK, Index of Services and Preliminary GDP from the UK, Consumer Price Index data form Canada and Durable Goods Orders and Preliminary GDP from the US.

EUR/USD analysis for 26/01/2018:

During an interview for CNBC in Davos, US President Trump said he ultimately wanted to see a strong US Dollar, and the earlier comments of the secretary of the treasury Mnuchin were "out of context". After these words, the market underwent mass closing of short positions in USD, pushing USD / JPY to 109.75, and EUR / USD fell to 1.2360.

Let's take a look at the EUR/USD technical picture at the H4 time frame. The market has made a higher high at the level of 1.2538 and felt towards the technical support at the level of 1.2361. Nevertheless, the price has managed to rebound quickly and now is trading higher around the level of 1.2487, threating to test the recent high. The momentum is still above its fifty level and the market is bouncing from the oversold territory. Any breakout above the level of 1.2538 would suggest the uptrend is being continued.

Exchange Rates 26.01.2018 analysis

Market Snapshot: USD/JPY bounces from lows

The price of USD/JPY has bounced from the lows at the level of 108.50 and managed to retrace 38% of the previous swing down. The Doji candle around this level has confirmed a weakness of the market and price has dropped again. Please notice, the market is trading in oversold conditions, so the bounce might continue higher.

Exchange Rates 26.01.2018 analysis

Market Snapshot: Gold is struggling with the resistance

The price of Gold has hit the level of $1,365 and then dropped towards the lower channel line at the level of $1,344. The market conditions are still overbought, but the momentum is trading above its fifty level. Only a violation of the lower channel line around the level of $1,340 would change the uptrend to downtrend, otherwise, the market will try to test the recent high again.

Exchange Rates 26.01.2018 analysis

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

Sebastian Seliga,
Analytical expert
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