Daily F.X. Analysis, January 08 – Top Trade Setups In Forex - Iran Attacks U.S. Military Bases!

The U.S. Iran tensions remain the main highlights of the day. Iran has ignited over a dozen rockets at two Iraqi military camps treating U.S. troops. The missiles amid the Ain al-Assad first in Anbar territory and Erbil's airport in northern Iraq in retaliation for the assassination of prime Iranian commander Qassem Soleimani by the United States. 

Economic Calendar - Risk-off Sentiment In-Play

 BTC/USD - Daily Analysis 

On Wednesday, the BTC/USD soared more than $500 to settle over the pivotal $8,000 resistance versus the U.S. Dollar. A fresh 2020 high has been formed around $8,464, and the price is presently trading slightly lower in the wake of correction.

There was a bullish breakout of 7,630, which was known as a major resistance on the daily timeframe of the BTC/USD. Lately, the BTC/USD has violated a series of major resistance around $7,500 and $8,000 on the daily timeframe. This price movement suggests a strong bullish bias that can lead the BTC/USD towards $9,100 or even $10K mark.

BTC/USD - Daily Technical Levels

Support     Resistance 

7,775.18       8,229.16

7,528.9        8,436.86

7,074.92     8,890.84

Pivot Point 7,982.88

BTC/USD – Daily Forecast

Lately, the financial markets have been extremely volatile in the wake of safe-haven appeal, which is making the dollar weaker. Due to this, the BTC/USD is exhibiting dramatic buying as it reached to place high of around 8,450. On a daily timeframe, the BTC/USD has the potential to surge until the 61.8% Fibonacci level, which is likely to extend resistance around 8,605 today. The support still stays around 8,230. The bullish bias remains strong.

EUR/USD – Double Bottom In-Play 

The EUR/USD prices closed at 1.11526 after placing a high of 1.11975 and a low of 1.11335. Overall the movement of EUR/USD prices remained strongly bearish that day. 

At 15:00 GMT, the Annual Consumer Price Index (CPI) Flash Estimate from Eurozone came in line with the expectations of 1.3%. The Core CPI Flash Estimate of Eurozone for the year also remained the same at 1.3%.

The Italian Prelim Consumer Price Index (CPI) for December also remained as expected at 0.2%. However, the Retail Sales for November from the Eurozone came in higher than expected and supported single Currency. The Retail Sales in November increased to 1.0% from forecasted 0.6%.

With inflation running below ECB's target of 2% and the continued weak economic growth, Euro currency still needs support from the central bank's measures. The positive data related to Retail Sales from Eurostat indicated a stronger household demand in November.

The Eurozone bond yields on Tuesday edged up from the 3-week lowest point on the fears of rising conflict between the U.S. & Iran. Demand for safe-haven assets increased in financial markets, and riskier assets like EUR/USD decreased despite increasing Eurozone bond yields.

On the other hand, regarding the Spanish election on Tuesday, Spain will be led by a coalition government for the first time in 80 years. The Parliament voted for a joint administration between the Socialist party and the anti-austerity Unidas Podemos alliance.

The 10-year bond yield of Spain rose2 bps towards the level of 0.41% on Tuesday on the latest political developments. Meanwhile, the better than expected ISM Non-Manufacturing PMI from the United States also added in the pressure of EUR/USD on Tuesday. The Non-Manufacturing PMI for December came in as 55.0 against the expectations of 54.5 and supported the U.S. dollar. 

Stronger U.S. dollar and heightened demand for safe-haven assets on Tuesday dragged down the prices of EUR/USD pair to the lowest point of 1.11335.

EUR/USD - Daily Technical Levels

Support Resistance 

1.1127     1.1186

1.1101     1.1219

1.1041     1.1278

Pivot Point 1.116

EUR/USD – Daily Forecast

The EUR/USD is trading in a bearish tone despite weakness in the U.S. dollar. The pair is trading at 1.1148, below a strong resistance level of 1.1160, which may drive more bearish bias until 1.1135 in the EUR/USD. Violation of 1.1135 can lead EUR/USD prices towards 1.1120.

GBP/USD - Symmetric Triangle Pattern

The GBP/USD closed at 1.31203 after placing a high of 1.32119 and a low of 1.30948. Overall the movement of GBP/USD remained bearish throughout the day.

The members of the British Parliament returned from the Christmas break on Tuesday, and the debates on PM Johnson's E.U. withdrawal bill agreement started. During the late sessions of 2019, the bill was passed, and now it has been under reconsideration before making it a law.

The Swiss National Party and the Labour Party have tried hard to amend the bill during debates, but they all were easily defeated. And it is highly expected that their requested amendments would be rejected after the voting in Parliament on Thursday due to the maximum majority of Tories.

Meanwhile, the Members of the European Parliament have raised concerns about the deportation of E.U. citizens living in the U.K. at the time of Brexit. The Conservatives were highly criticized by the British watchdog and Regulatory Policy Committee (RPC) for failing to assess the full impact of PM Johnson's Brexit deal.

On the other hand, the U.S. dollar was stronger on Tuesday amid the expansion in ISM Non-Manufacturing PMI. The stronger USD added to the downfall of GBP/USD prices on Tuesday.

At 14:55 GMT, the Housing Equity Withdrawal for the 3rd Quarter from the United Kingdom was released, which showed a decline of -6.3B against the expectations of -7.2B and supported British Pound.

On Wednesday, the U.K. Prime Minister Boris Johnson and the European Union Council President Von der Leyen will meet, and traders are looking forward to the developments they will discuss the post-Brexit trade deal.

GBP/USD - Daily Technical Levels

Support Resistance 

1.3148     1.3163

1.314       1.3171

1.3125     1.3186

Pivot Point 1.3156

GBP/USD – Daily Forecast

The GBP/USD is trading at 1.3115, holding below a strong resistance level of 1.3135. The RSI and 50 EMA both are suggesting bearish bias among traders. Below 1.3137, the cable has the potential to go after 1.3095 and 1.3070 on the lower side. While the bullish breakout of 1.3135 can lead the GBP/USD prices towards 1.3189.

All the best for today.