2025-01-23 10:56
European Central Bank policymakers showed their support for more rate cuts in 2025. Market participants are fully pricing an ECB rate cut next week. Trump has hinted at a 10% universal tariff that would affect goods from the Eurozone. The EUR/USD outlook shows growing support among ECB policymakers for more rate cuts this year, weighing on the euro. Meanwhile, the dollar paused its rally as market participants prepared for the Federal Reserve policy meeting. -Are you interested in learning about forex tips? Click here for details- On Wednesday, European Central Bank policymakers, including Lagarde, showed their support for more rate cuts in 2025. The central bank has already implemented four cuts, and markets are pricing four more this year. Moreover, they are fully pricing a rate cut next week. There was some relief when Trump failed to immediately implement tariffs on his first day in office. However, he plans to impose them sometime during the first quarter. Tariffs on imports from the Eurozone would hurt the already weak economy. Therefore, it would push the ECB to lower borrowing costs faster. Trump has threatened a 25% tariff on Mexico and Canada. Meanwhile, he has hinted at a 10% universal tariff that would affect goods from the Eurozone. The greenback strengthened slightly on Thursday as traders digested Trump’s tariff plans. Meanwhile, there was some caution before next week’s Fed policy meeting. Economists expect the central bank to keep interest rates unchanged. At the same time, policymakers might give clues on the outlook for 2025. A hawkish tone will support the dollar and hurt the euro. On the other hand, if policymakers suggest more rate cuts than expected, the dollar might collapse. EUR/USD key events today US unemployment claims President Trump speaks EUR/USD technical outlook: Price retreats after testing channel resistance On the technical side, the EUR/USD price is retreating after meeting the 1.0450 resistance level. However, the bias is bullish since the price trades above the 30-SMA, with the RSI in bullish territory. At the same time, the price trades in a bullish channel. It recently touched the channel resistance before turning south. -Are you interested in learning about the forex basics? Click here for details- Meanwhile, although the price made a higher high, the RSI trended down, indicating a bearish divergence. Therefore, bears might be ready to push the price down to the 1.0350 level and the channel support. Nevertheless, the uptrend will continue if the price stays within the channel. On the other hand, sentiment will shift to bearish if the price breaks below the channel support. https://www.forexcrunch.com/blog/2025/01/23/eur-usd-outlook-momentum-builds-for-more-ecb-cuts-in-2025/
2025-01-23 10:51
The dollar recovered on Wednesday after Trump’s tariff policy plans became clearer. Traders look forward to central bank meetings in the US and Japan. Traders are pricing a 96% chance of a BoJ rate hike on Friday. The USD/JPY forecast shows a pause in the dollar’s recent climb as market participants await key central bank decisions. Traders paused ahead of Friday’s Bank of Japan meeting, where the central bank might hike rates by 25-bps. -Are you interested in learning about forex tips? Click here for details- The dollar recovered on Wednesday after Trump’s tariff policy plans became clearer. Although not immediate, the US president plans to impose a 25% tariff on imports from Mexico and Canada. At the same time, the government has united at a 10% tariff on goods from China. All this might happen by next month. However, experts believe the government might reveal concrete tariff plans in April. Meanwhile, traders look forward to central bank meetings in the US and Japan. The Federal Reserve will meet next week, and economists expect a pause. Therefore, market participants will focus on the messaging for future policy moves. A hawkish outlook will boost the dollar. Meanwhile, a dovish one might lead to a pullback. On the other hand, the Bank of Japan will meet on Friday, with traders pricing a 96% chance of a rate hike. Moreover, policymakers might signal more rate hikes to balance the impact of Trump’s policies on the global economy. At the same time, if the Fed remains hawkish, the dollar might pressure the yen lower. Therefore, the BoJ will have enough motivation to keep hiking rates. USD/JPY key events today US unemployment claims President Trump speaks USD/JPY technical forecast: Bulls take charge after RSI divergence On the technical side, the USD/JPY price has broken above the 30-SMA resistance to indicate a bullish sentiment shift. This move came after the RSI made a bullish divergence, showing weak bearish momentum. -Are you interested in learning about the forex basics? Click here for details- The previous downtrend paused at the 155.01 support level, where bulls emerged. Although bears made another attempt to break below this level, the price made a large wick, showing a strong rejection. This allowed bulls to breach the 30-SMA resistance. Currently, the price is eyeing the 157.01 resistance level. If it holds firm, USD/JPY will likely retest the 30-SMA as support before continuing higher. Meanwhile, if bulls are strong, they will break past the resistance to target the 158.74 key level. https://www.forexcrunch.com/blog/2025/01/23/usd-jpy-forecast-dollar-stalls-as-traders-eye-key-central-banks/
2025-01-22 11:23
Trump’s new administration failed to give clear policy guidance. Trump’s speech later in the day might contain hints on his policy plans. UK pay growth was solid in the three months to November. The GBP/USD forecast indicates uncertainty about the outlook for Trump’s policies, which has left the dollar vulnerable. Meanwhile, the pound strengthened after data in the previous session showed a resilient labor market. -Are you interested in learning about forex tips? Click here for details- Before Trump’s inauguration, investors were grappling with the likely impact of Trump’s policy proposals. Most had expected an aggressive start to his new term with clear guidance on tariffs and taxes. However, that was not the case on Monday. Trump’s new administration failed to give clear guidance. Although Trump later announced his plans to impose tariffs on Mexico and Canada, it was already clear that he would not be as aggressive as thought. As a result, the dollar weakened against its peers, like the pound. Market participants are awaiting economic data for clues on Fed rate cuts. At the same time, Trump will speak later in the day, and his speech might contain hints on his policy plans. Meanwhile, the pound held steady after data in the previous session revealed that UK pay growth was solid in the three months to November. At the same time, monthly unemployment claims dropped to 700 compared to estimates of 10,300. Nevertheless, Bank of England rate cut bets remained fairly unchanged. Economists expect a rate cut in February and three more in 2025. Later in the week, business activity data will shed more light on the outlook for UK monetary policy. GBP/USD key events today US unemployment claims President Trump speaks GBP/USD technical forecast: Bulls trigger channel breakout On the technical side, the GBP/USD price has broken out of its bearish channel resistance, signalling a likely bullish reversal. Initially, the price was in a downtrend, making lower highs and lows. Moreover, it was trading in a bearish channel. However, sentiment shifted when it broke above the SMA and the channel resistance. -Are you interested in learning about the forex basics? Click here for details- Furthermore, GBP/USD broke above the 1.2250 key level with a solid bullish candle. It retested the level and rose to a higher high, confirming a new uptrend. Bulls are now eyeing the 1.2400 resistance level. A break above this level would allow the price to revisit the 1.2550 resistance level. The bullish trend will continue if the price stays above the SMA and the RSI above 50. https://www.forexcrunch.com/blog/2025/01/22/gbp-usd-forecast-policy-uncertainty-overshadows-dollar/
2025-01-22 09:35
USD/CAD has experienced wild swings since Trump took office on Monday. Canada’s government plans to respond appropriately to Trump’s tariffs. Data on Tuesday revealed that inflation in Canada fell by 0.4%. The USD/CAD price analysis shows continued uncertainty about Trump’s tariff policies that have caused wild fluctuations. The Canadian dollar strengthened as markets doubted a near-term tariff on Canadian goods. The currency also got support from a monthly inflation number stronger than expected. -Are you interested in learning about forex tips? Click here for details- Since Trump took office on Monday, USD/CAD has experienced wild swings amid tariff uncertainty. At first, the loonie jumped when there was no clear guidance on any near-term tariffs. However, sentiment shifted when Trump later came out to say he was ready to impose a 25% tariff on goods from Canada and Mexico as soon as Feb 1. However, by Wednesday, market participants were again optimistic. Canadian Prime Minister Justin Trudeau noted that the government would respond appropriately to Trump’s tariffs. Moreover, he pointed out that the US needs Canada to prosper. Therefore, such tariffs would also hurt the US economy. Elsewhere, data on Tuesday revealed that inflation in Canada fell by 0.4%, bigger than the forecast of a 0.7% decline. Nevertheless, the annual figure eased to 1.8%, solidifying bets for a January Bank of Canada rate cut. Meanwhile, the dollar remained steady, with traders awaiting more policy clues from Trump later in the day. USD/CAD key events today Canada core retail sales m/m Canada retail sales m/m US unemployment claims President Trump speaks USD/CAD technical price analysis: Consolidating in wide range On the technical side, the USD/CAD price failed to break its range resistance and dropped back to the channel support. At the same time, it broke below the 30-SMA while the RSI dipped below 50, suggesting a stronger bearish sentiment. Recent candles show a significant surge in volatility because they are much bigger than previous ones. If this continues, the price will eventually break out of its consolidation to start trending up or down. -Are you interested in learning about the forex basics? Click here for details- Currently, bears are approaching the range support. If the price breaks below this level, it will likely reach the 1.4201 support. This will lead to a lower low and the start of a downtrend. On the other hand, bulls might resurface at the range support to push the price higher. In this case, USD/CAD would try to break above the range resistance. https://www.forexcrunch.com/blog/2025/01/22/usd-cad-price-analysis-tariff-uncertainty-fuels-market-volatility/
2025-01-21 10:17
Trump only focused on immigration and energy on Monday. Trump told reporters he might be ready to impose near-term tariffs on Canada and Mexico. Market participants will keep a close eye on US political developments. The EUR/USD price analysis portrays renewed bullish momentum after a slow start to Trump’s new term. The euro rallied in the previous session after the new administration failed to give any clues on its tariff plans. However, the pair pulled back slightly when Trump later signaled near-term tariffs on Canada and Mexico. -Are you interested in learning about forex tips? Click here for details- Traders had waited for Trump’s inauguration speech with anticipation. They were waiting to see whether he would state his plans on tariffs and implement them immediately. However, the new president only focused on immigration and energy. Consequently, there was some relief for the euro, which would have suffered at the prospect of near-term tariffs. During the campaigns, Trump proposed a 25% tariff on Canadian goods, a 60% tariff on Chinese goods, and a universal 10% tariff. Such an outcome would significantly weigh on the currencies of these countries. However, these currencies pulled back overnight because Trump told reporters he might be ready to impose tariffs on Canada and Mexico in February. Meanwhile, he noted that the country was not ready for universal tariffs. Market participants will keep a close eye on any developments moving forward. EUR/USD key events today Market participants do not expect any high-impact releases from the US or the Eurozone today. Hence, they will monitor political developments in the US. EUR/USD technical price analysis: Broken level retested On the technical side, the EUR/USD price has pulled back to the 1.0350 support level after making a new high to confirm a bullish trend. The previous downtrend paused near the 1.0200 support level, where bulls resurfaced. -Are you interested in learning about the forex basics? Click here for details- Sentiment shifted when the price broke above the 30-SMA and the RSI broke above 50. Bulls confirmed the new trend by respecting the 30-SMA as support and making a higher high. At the same time, the price has started trading in a bullish channel with clear support and resistance trendlines. If EUR/USD finds support at the 1.0350 level, it will bounce higher to retest the 1.0450 resistance level. However, it might fall to the 30-SMA and the channel support before rebounding. Nevertheless, the bullish bias is strong and will remain intact unless the price breaks out of the bullish channel. https://www.forexcrunch.com/blog/2025/01/21/eur-usd-price-analysis-trumps-hesitant-beginning-boosts-euro/
2025-01-21 08:45
Trump’s administration did not give any guidance on tariff plans on Monday. Trump told reporters he was considering near-term tariffs on Canada and Mexico. Market participants are looking forward to Canada’s inflation data. The USD/CAD outlook shows a sudden shift in sentiment amid mixed signals on Trump’s tariff plans. The Canadian dollar rallied in the previous session as it became clear that the new administration would not implement tariffs immediately. However, this outlook shifted when Trump hinted at starting next month. -Are you interested in learning about forex tips? Click here for details- On Monday, the greenback collapsed as Trump’s first day in office failed to be as aggressive on policy changes. The new administration did not give any guidance on tariff plans, leading most to believe it would be a gradual shift. As the dollar collapsed, its peers, especially the Canadian dollar soared. For weeks, market participants had worried that Trump would aggressively implement a 25% tariff on goods imported from Canada. Therefore, the lack of guidance was a relief for the loonie. Such a heavy tariff would hurt the local economy and push the Bank of Canada to cut interest rates further to spur growth. However, the trend turned sharply overnight after Trump told reporters he was considering near-term tariffs on Canada and Mexico. According to him, February 1 might be the right time to implement the tariffs. Elsewhere, market participants are looking forward to inflation data from Canada, which will shape the outlook for Bank of Canada rate cuts. USD/CAD key events today Canada CPI m/m Canada median CPI y/y Canada trimmed CPI y/y USD/CAD technical outlook: Broad range consolidation On the technical side, the USD/CAD price fell back into its range area, confirming a false bullish breakout. However, the price made a whiplash move within the range, reaching the range support and rising back to the resistance with single large candles. This shows increased volatility that was contained in the range. -Are you interested in learning about the forex basics? Click here for details- Currently, the price trades above the 30-SMA, with the RSI above 50, supporting a bullish bias. Initially, bulls broke above the range resistance but failed to close above the level, making a large wick. If they succeed at breaking out, the price will likely breach the 1.4501 resistance level. Otherwise, it will fall back to the range support. A break below the range support would indicate a bearish breakout. However, to confirm a new downtrend, the price would have to start making lower highs and lows. https://www.forexcrunch.com/blog/2025/01/21/usd-cad-outlook-sentiment-swings-over-trumps-trade-plans/
