A case of getting reacquainted

Next 24 hours: No exceptions, some exceptions

Today’s report: A case of getting reacquainted

Markets are off to a quiet start this week, though we have seen a notable pickup in risk appetite. As we’ve already highlighted, a lot of the volatility we’ve been seeing in 2025 thus far feels like it could be a lot more about getting reacquainted with Trump tactics than from any real threat of a major shakeup in global trade.

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 1.0443 –5 February high – Medium
  • R1 1.0400 - Figure – Medium
  • S1 1.0272 - 4 February low – Medium
  • S2 1.0178 – 13 January/2025 low – Strong

EURUSD – fundamental overview

The Euro has been contending with fear around trade risks. On Monday, the ECB President was on the wires saying the frquency of shocks was likely to remain high in the future. She also added the inflation outlook would be even more uncertain due to trade friction, but that the central bank still expects inflation to return to 2% this year. Key standouts on today’s calendar come from a BOE Bailey speech, Canada building permits, Fed Chair Powell testimony, and some 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 1.2576 – 7 January high – Strong
  • R1 1.2550 – 5 February high – Medium
  • S1 1.2249 –  3 February low – Medium
  • S2 1.2161 – 17 January low – Medium

GBPUSD – fundamental overview

The Pound has been mostly quiet in recent trade, with the focus still on all things trade wars and tariffs. We did however get the news that PM Starmer will be meeting with President Trump before the end of the month. Key standouts on today’s calendar come from a BOE Bailey speech, Canada building permits, Fed Chair Powell testimony, and some 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 156.76 – 23 January high – Strong
  • R1 155.89 – 3 February high – Medium
  • S1 150.93– 7 February low – Medium
  • S2 150.00 – Psychological – Medium

USDJPY – fundamental overview

The Yen was the top performing currency in the G-10 last week, getting a boost from stronger Japan economic data and ongoing calls for more rate hikes from the BOJ this year. PM Ishiba's first DC trip was also deemed to be widely successful. Key standouts on today’s calendar come from a BOE Bailey speech, Canada building permits, Fed Chair Powell testimony, and some 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 0.6331 – 24 January/2025 high – Medium
  • R2 0.6297 – 5 February high – Medium
  • S1 0.6170 – 4 February low – Medium
  • S2 0.6087 – 3 February/2025 low – Strong

AUDUSD – fundamental overview

An improvement in NAB business confidence was offset by weaker than expected Westpac consumer confidence reads. The Australian Dollar has been mostly sideways in the aftermath and is preparing for what should be a 25 basis point rate cut from the RBA next week. Key standouts on today’s calendar come from a BOE Bailey speech, Canada building permits, Fed Chair Powell testimony, and some 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 1.4200.

  • R2 1.4595 – 30 January high – Medium
  • R1 1.4503 – 4 February high – Medium
  • S1 1.4300 – Figure – Medium
  • S2 1.4270 – 5 February/2025 low – Strong

USDCAD – fundamental overview

The Canadian Dollar has been mostly able to hold onto recent recovery gains despite ongoing stress relating to tariffs. It seems the combination of a market feeling a little less threatened by Trump talk which appears to be more of a negotiating tactic and last week's much better than expected Canada jobs report have been helping to offset bearish flow. Key standouts on today’s calendar come from a BOE Bailey speech, Canada building permits, Fed Chair Powell testimony, and some 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 0.5724 – 24 January/2025 high – Strong
  • R1 0.5703 – 5 February high – Medium
  • S1 0.5582 – 4 February low – Medium
  • S2 0.5541 – 13 January low – Medium

NZDUSD – fundamental overview

The New Zealand Dollar is trying to find its feet as it contends with stress from last week's of not so great New Zealand data, worry around Trump tariffs, and what should be another 50 basis point RBNZ rate cut. Key standouts on today’s calendar come from a BOE Bailey speech, Canada building permits, Fed Chair Powell testimony, and some 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 5679, 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 6133 – 24 January/Record high – Medium
  • S1 5771 – 13 January/2025 low – Medium
  • S2 5697 – 4 November 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 2943 – 11 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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