Hard to get a handle

Next 24 hours: Mixed signals from markets

Today’s report: Hard to get a handle

Investors have been worrying more about the impact of President Trump’s policies on the growth outlook and a recent round of softer economic data hasn’t helped matters. At the same time, it’s been hard to get a handle on what the actual substance of Trump policies will be.

Wake-up call

Chart talk: Technical & fundamental highlights

Choose pair:

EURUSD – technical overview

The Euro has been in a multi-month consolidation since bottoming out in 2022. Setbacks have since been exceptionally well supported on dips towards parity, with a higher platform sought out ahead of the next major upside extension. Look for a major bounce in the days ahead and the start to a push back towards the 2023 high at 1.1276. Only a monthly close below 1.0000 negates.

  • R2 1.0534 – 27 January/2025 high – Strong
  • R1 1.0529 - 24 February high  – Medium
  • S1 1.0373 - 13 February low – Medium
  • S2 1.0283 – 10 February low – Medium

EURUSD – fundamental overview

The Euro has been getting a nice boost from a round of hawkish central bank speak. Bundesbank President Nagel was out saying the ECB is 'more or less leaving restrictive territory' and would base future decisions around incoming data. We've also seen some bids coming in around the conversation about the proposed 200 billion Euro defense spend from Germany. Key standouts on Wednesday’s calendar come from German consumer confidence, Canada wholesale sales, US new home sales, building permits, BOE speak, and Fed speak.

EURUSD - Technical charts in detail

GBPUSD – technical overview

Signs have emerged of the market wanting to put in a longer-term base after collapsing to a record low in September 2022. The door is now open for the next major upside extension towards the 2018 high at 1.4377. Setbacks should be well supported above 1.2000 on a monthly close basis.

  • R2 1.2729 – 17 December high – Strong
  • R1 1.2691 – 24 February/2025 high – Medium
  • S1 1.2563 –  19 February low – Medium
  • S2 1.2545 – 14 February low – Strong

GBPUSD – fundamental overview

The latest CBI data out of the UK points to British retailers cutting back on investments due to soft consumer spending and high prices. PM Starmer is getting ready for his visit to DC to discuss trade and the Russia-Ukraine conflict. Key standouts on Wednesday’s calendar come from German consumer confidence, Canada wholesale sales, US new home sales, building permits, BOE speak, and Fed speak.

USDJPY – technical overview

The market is looking to resume the longer-term uptrend after an intense correction in 2024. A higher low is ideally sought out above 140.00 in favor of a bullish continuation. The October monthly close back above 150.00 strengthens the case for longer-term uptrend resumption.

  • R2 154.80 – 12 February high – Strong
  • R1 152.32 – 19 February high – Medium
  • S1 148.84 – 24 February/2025 low – Medium
  • S2 148.64 – 3 December low – Strong

USDJPY – fundamental overview

Economic data out of Japan has been trending up along with inflation reads which continues to support the BOJ's hawkish leaning policy track. A lot of the focus will shift to Friday's Tokyo inflation data. Key standouts on Wednesday’s calendar come from German consumer confidence, Canada wholesale sales, US new home sales, building permits, BOE speak, and Fed speak.

AUDUSD – technical overview

There are signs of the potential formation of a longer-term base with the market trading down into a meaningful longer-term support zone. Only a monthly close below 0.6000 would give reason for rethink. A monthly close back above 0.7000 will take the big picture pressure off the downside and strengthen case for a bottom.

  • R1 0.6430 – 12 December high – Medium
  • R2 0.6409 – 21 February/2025 high – Medium
  • S1 0.6310 – 14 February low – Medium
  • S2 0.6233 – 12 February low – Strong

AUDUSD – fundamental overview

The Australian Dollar is under a little pressure after the latest round of Aussie inflation data has come out on the softer side of expectation. Key standouts on Wednesday’s calendar come from German consumer confidence, Canada wholesale sales, US new home sales, building permits, BOE speak, and Fed speak.

USDCAD – technical overview

A sustained hold above 1.3000 over the past several months signals an end to a period of longer-term bearish consolidation and suggests the market is in the process of carving out a more significant longer-term base. Next key resistance now comes in at the 1.5000 psychological barrier. Setbacks should be very well supported ahead of 1.4000.

  • R2 1.4595 – 30 January high – Medium
  • R1 1.4380 – 10 February high – Strong
  • S1 1.4151 – 14 February/2025 low – Medium
  • S2 1.4100 – Figure – Medium

USDCAD – fundamental overview

The Canadian Dollar has come back under pressure this week as President Trump says tariffs on Canada and Mexico are on schedule to proceed as planned next week. Risk off flow has been another factor as well.  Meanwhile, traders are looking ahead to Friday's Canada GDP data. Key standouts on Wednesday’s calendar come from German consumer confidence, Canada wholesale sales, US new home sales, building permits, BOE speak, and Fed speak.

NZDUSD – technical overview

Overall pressure remains on the downside with the market continuing to stall out on runs up into the 0.6500 area. At the same time, there are some signs of the market wanting to put in a longer-term base. Ultimately, a break back above 0.6500 would be required to take the medium-term pressure off the downside and encourage this prospect. A monthly close below 0.5469 will intensify bearish price action.

  • R2 0.5818 – 12 December high – Medium
  • R1 0.5773 – 21 February/2025 high – Medium
  • S1 0.5600 – 12 February low – Strong
  • S2 0.5541 – 13 January low – Medium

NZDUSD – fundamental overview

The New Zealand Dollar has come under pressure in recent session as trade tensions ramp back up and US equities falter. Key standouts on Wednesday’s calendar come from German consumer confidence, Canada wholesale sales, US new home sales, building permits, BOE speak, and Fed speak.

US SPX 500 – technical overview

The longer term uptrend remains intact and dips continue to be exceptionally well supported. Critical support comes in at 5770, with only a break back below this level to compromise the structure and open the door for a more significant corrective decline. Until then, the focus remains on a continued push to fresh record highs.

  • R2 6200 – Round Number – Strong
  • R1 6152 – 19 February/Record high – Medium
  • S1 5912 – 3 February low – Medium
  • S2 5770 – 13 January/2025 low – Strong

US SPX 500 – fundamental overview

Investors are feeling better about a soft landing in the US economy. Moreover, there has been a fresh wave of market optimism in anticipation of a market bullish Trump presidency. It will however be important to keep an eye on Trump trade policies, inflation, bigger picture economic data and the latest shift in the Fed dot plot. Any of these variables are capable of easily ruffling some feathers and we've already seen a little of this as 2025 gets going.

GOLD (SPOT) – technical overview

The 2019 breakout above the 2016 high at 1375 was a significant development, opening the door for fresh record highs and this next major upside extension into the 3000 area. Setbacks should now be well supported above 2500 on a monthly close basis.

  • R2 3000 – Psychological – Strong
  • R1 2957 – 24 February/Record high – Medium
  • S1 2730 – 27 January low – Medium
  • S2 2689 – 20 January low – Medium

GOLD (SPOT) – fundamental overview

The yellow metal has pushed record highs in recent months with solid demand from medium and longer-term accounts. These players are more concerned about inflation, geopolitical risk and a less upbeat global growth outlook. All of this should keep the commodity well supported over the coming months.

Peformance chart: 30-Day Performance vs. US dollar (%)

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Daily Reports Global FX Insights   joelkruger  

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