Daily F.X. Analysis, January 20 – Top Trade Setups In Forex - Happy Monday, Brace for Trades!
By Eaglefx On January 20, 2020 in Daily Market Analysis
The U.S. official data showed that housing starts surged to an annualized rate of 1.608 million units in December, higher than 1.380 million units expected and the highest level since late-2006. The number of building permits posted 1.416 million units, lower than 1.460 million units expected.
Economic Calendar - Martin Luther King Day Holiday!
BTC/USD - Daily Analysis
Bitcoin wonderfully realized the resistance at $9,000 over the weekend. For the very first time in the year 2020, the BTC/USD buyers managed not just to push the price over $9,000 but also increase the gains towards $9,200. Regrettably, the high reached at $9,196 market the end of the short rally.
Nearly next reversal caught the momentum that delayed short of $9,200. Bitcoin spiraled, unbothered of the soft support at $9,000. The following essential support at $8,750 was penetrated sharply, ending in more declines towards $8,500.
BTC/USD - Daily Technical Levels
Support Resistance
8,735.08 8,974.19
8,632.13 9,110.35
8,393.02 9,349.46
Pivot Point 8,871.24
BTC/USD – Daily Forecast
The BTC/USD fell dramatically lower to place a low of 50% Fibonacci retracement level of 8,450. Later it managed to close higher above 8,654. At the moment, the pair is trading at 8,650 with immediate support around 8,600 and resistance at 8,730. On the higher side, 8,845 is a key below which the BTC/USD is likely to maintain the bearish momentum today.
EUR/USD – Resistance Becomes Support
Today in the early Asian session, the EUR/USD currency pair was found on the recovery track near the 1.1100 level ahead of ECB's President C. Lagarde's speech. As of writing, the EUR/USD currency pair is currently trading at 1.1089 and struggling to hit the 1.1100 level. By the way, the pair's day consolidation range is 1.086 - 1.1103.
The EUR/USD pair came under heavy selling pressure during the Friday in the wake of the sharp pick-up in the greenback, mainly due to the positive results from some U.S. indicators, higher yields, and the prevailing risk-on sentiment.
At the data front, the German Producer Prices increased by 0.1% during December and decreased by 0.2% from a year earlier. Later in the European evening, ECB's President, Christine Lagarde, is scheduled to speak in the Euro group meeting in Brussels and will attend an event in Germany.
The EUR/USD pair dropped and hit the 55-day SMA last week, mainly due to the greenback movements. Meanwhile, it is the probability that the 1.1180 regions will likely be a high-level today.
It should be noted that the holiday in the U.S. stands to keep trading sentiment and volatility, light for the session ahead. But more importantly, the ECB is scheduled to meet later in the week. The traders in the market are mostly in the waiting mood for placing meaningful speculative positions until after getting transparency on the bank's latest monetary policy stance.
EUR/USD - Daily Technical Levels
Support Resistance
1.107 1.1125
1.1051 1.1161
1.0996 1.1216
Pivot Point 1.1106
EUR/USD – Daily Forecast
The EUR/USD is consolidating at 1.1086, having completed a bearish engulfing pattern. The bearish engulfing pattern is proposing the chances of a bullish trend in the EUR/USD. The EUR/USD can show bullish correction until 1.1106 and 1.1112 before showing further selling.
The EUR/USD may find next support around 1.1065 and violation of which can lead EUR/USD prices towards 1.1045. Whereas, the bullish breakout of 1.1106 can drive buying until 1.1140. w
GBP/USD - Descending Triangle
The GBP/USD currency pair remained under pressure and dropped below the 1.3000 level mainly due to the rising chances of the Bank of England rate cut, as well as the recent negative headlines regarding Brexit also gave some fresh bearish pressure to the pair. As of writing, the GBP/USD currency pair is currently trading at 1.2984 and consolidates in the range between the 1.2981 - 1.3000.
As we know, the uncertainty surrounding the market increased due to the comment of the United Kingdom Finance Minister, Sajid Javid that. Britain was planning to shift its economy further from the European Union.
Whereas another news from the U.K. Express also threatened the Brexit optimism. The report revealed that the United Kingdom Prime Minister Boris Johnson has planned to impose restrictions on low-skilled E.U. migrants on the first day after the Brexit departure period ends in December 2020.
This news will increase difficulties between the United Kingdom and European Union talks and will increase the chance of hard Brexit as well.
At the data front, the negative figures of the U.K. Retail Sales, which were released on Friday, entertained the Bank of England doves before the month-end meeting regarding monetary policy. At the beginning of the month, the Bank of England Governor Mark Carney showed fears of Brexit and renewed risks of a rate cut from the British central bank.
On the other hand, the greenback continues to flash green because of favorable economic forces, which made U.S. Federal Reserve rethink their "wait and watch" strategy.
Whereas the market risk-sentiment is still inactive in the wake of lack of U.S. traders and significant data /events on the economic calendar.
Looking forward, traders will keep eyes on the trade/Brexit headlines for fresh impulse while Tuesday's headlines employment data from the U.K. will be the key to watch.
Therefore, traders will keep their eyes on the Brexit and trade headlines for taking fresh direction while the Tuesday employment data report from the U.K. will remain on top of traders' radar.
GBP/USD - Daily Technical Levels
Support Resistance
1.2969 1.3085
1.2928 1.316
1.2812 1.3276
Pivot Point 1.3044
GBP/USD – Daily Forecast
The GBP/USD has traded bearishly after violating the pivot point level of 1.3044. Right now, the Cable is gaining support around 1.2960, a violation of which is likely to lead GBP/USD prices towards 1.2904.
Currently, it's trading at 1.2998, just above the horizontal support level of 1.2960. Below this, the GBP/USD may find the next support around 1.290. The RSI and Stochastic of GBP/USD are holding in the bearish zone, suggesting chances of a bearish trend in the Cable. Let's stay bearish under 1.3040 today.
All the best for today.