ECB President Lagarde and German Business sentiment figures will provide the EUR with direction. COVID-19 news and U.S stimulus talks will also be in focus.
For the EUR
It’s a relatively busy day ahead on the economic calendar. January IFO Business Climate figures for Germany are due out later this afternoon.
Following ECB President Lagarde’s cautious outlook on the economic recovery and some disappointing PMI numbers, we can expect sensitivity to today’s stats.
On the monetary policy front, ECB President Lagarde could also move the dial with a scheduled speech later today.
Away from the economic calendar, however, COVID-19 news will remain a key driver. Vaccination supply, low vaccination rates, and rising new COVID-19 case remain downside risks for the economy.
At the time of writing, the EUR was down by 0.01% to $1.2170.
For the Pound
It’s a quiet day ahead on the economic calendar. There are no material stats to provide the Pound with direction.
The lack of stats should leave the Pound in the hands of COVID-19 news updates. A marked pickup in vaccination rates should support the Pound at the start of the week.
At the time of writing, the Pound was up by 0.04% to $1.3692.
For the USD
It’s also a quiet day ahead on the economic calendar. There are no material stats to provide the Dollar with direction.
The lack of stats will leave COVID-19 news and chatter from Capitol Hill in focus.
EURUSD has formed another consolidation range around 1.2170; right now, it is moving to break it to the upside to reach the target at 1.2260. Later, the market may return to 1.2170 and then resume trading within the uptrend with the target at 1.2282.
AUD/USD managed to get above the resistance at 0.7725 and is trying to settle above the next resistance level at 0.7740.
AUD/USD received support at the 20 EMA at 0.7710 and gained upside momentum. Currently, AUD/USD is trying to settle above the nearest resistance level at 0.7740. RSI is in the moderate territory so there is plenty of room to gain momentum in case the right catalysts emerge.
If AUD/USD settles above the resistance at 0.7740, it will head towards the next resistance level at 0.7760. A successful test of this level will push AUD/USD towards the resistance which is located at 0.7780. If AUD/USD manages to settle above the resistance at 0.7780, it will move towards the next resistance level at 0.7800.
On the support side, the nearest support level for AUD/USD is located at 0.7725. If AUD/USD declines below the support at 0.7725, it will get to the test of the next support at the 20 EMA at 0.7710. A move below the 20 EMA will be a worrisome development for AUD/USD bulls as it will signal that AUD/USD will try to develop additional downside momentum.
Gold: A move to $1,800 is not ruled out
Friday’s negative performance of gold prices was in tandem with rising both open interest and volume, exposing the continuation of the downtrend in the very near-term. That said, the $1,800 mark per ounce emerges as the next key contention area.
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