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The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.0353
• Prev. Close: 1.0262
• % chg. over the last day: -0.88 %

The euro fell to 1.029 USD, the weakest level since November 2022, due to concerns about Europe’s economic outlook and optimism about the US economy as markets prepare for Donald Trump’s return to the White House. Low growth is expected in Europe, as well as political instability and structural problems in Germany and France. In addition, Trump’s potential trade tariffs raise the risk of a trade war, further dampening Europe’s outlook. Meanwhile, the European Central Bank’s (ECB) dovish stance has reduced support for the euro, while the Federal Reserve is expected to cut interest rates less aggressively than expected.

Trading recommendations

• Support levels: 1.0223
• Resistance levels: 1.0323, 1.0372, 1.0424, 1.0447, 1.0493, 1.0513

The EUR/USD currency pair’s hourly trend is bearish. The euro fell to the support level of 1.0223, where the fixation of earlier open sales occurred. This is confirmed by both the surge in volume and divergence on the MACD indicator. Below 1.0223 is a cluster of liquidity, so a retest of the level is not excluded. Currently, however, the price will tend more to test the broken level of 1.0323. Buy trades can be looked for intraday or from 1.0223, but with confirmation. Sell trades are not recommended now as the price has deviated strongly from the averages and has reached an important support level.

Alternative scenario:

if the price breaks the resistance level of 1.0425 and consolidates above it, the uptrend will be resumed with a high probability.

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News feed for: 2025.01.03

• German Unemployment Rate (m/m) at 10:55 (GMT+2);
• US ISM Manufacturing PMI (m/m) at 17:00 (GMT+2).
   

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2511
• Prev. Close: 1.2378
• % chg. over the last day: -1.07 %

The British pound fell to USD 1.2380, the lowest in eight months, due to concerns about the sustainability of the UK economy and the strengthening of the US Dollar. The UK economy is stagnating, and revised third-quarter data shows no growth, posing further challenges for Prime Minister Keir Starmer’s new government. In addition, the “dovish” tone of the Bank of England (BoE) when making the final decision on the 2024 rate has put additional pressure on sterling.

Trading recommendations

• Support levels: 1.2371, 1.2299
• Resistance levels: 1.2446, 1.2477, 1.2540, 1.2568, 1.2614, 1.2667

From the point of view of technical analysis, the trend on the GBP/USD currency pair is bearish. At the test of liquidity below 1.2500, the market received many market sell orders, accelerating the pound’s decline. The price has reached the support level of 1.2371, where some fixation of earlier open sales is observed. But this level is not enough for a reversal. It is necessary to grab liquidity. Therefore, most likely, the price will try to consolidate above 1.2446. Intraday buying can be considered today, but it is worth remembering that the price may make a few more minimum updates. There are no optimal entry points for selling right now.

Alternative scenario:

 if the price breaks through the resistance level at 1.2540 and consolidates above it, the uptrend will likely resume.

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News feed for: 2025.01.03

There is no news feed for today.
 

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 157.20
• Prev. Close: 157.51
• % chg. over the last day: +0.20 %

The Japanese yen remained practically unchanged at 157 per dollar on Friday amid low trading volumes as Japan’s vacation season is underway. Traders are closely monitoring possible Japanese government intervention after Finance Minister Katsunobu Kato reiterated concerns about a weakening yen and warned against excessive rate fluctuations. The yen has depreciated by more than 11% in 2024, marking the fourth consecutive year of depreciation against the dollar.

Trading recommendations

• Support levels: 156.54, 155.94, 154.34
• Resistance levels: 157.65, 157.89, 159.47

From a technical point of view, the medium-term trend of the USD/JPY currency pair is bullish. The Japanese yen demonstrates resistance to the growth of the US dollar. The euro and the British pound fell sharply yesterday on the background of the dollar index growth to the 2-month maximum, while the Japanese yen just flattened in the corridor of 156.54-157.65, and this on a day off in Japan. Yesterday, towards the end of the trading session, the price tested liquidity above 157.65, so the distribution of this liquidity lower is now expected. Intraday sell trades can be considered with a target of up to 156.54, but the price could fall to 155.94 as well. There are no optimal entry points for buying right now.

Alternative scenario:

If the price breaks and consolidates below the 155.94 support, the downtrend is likely to resume.

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News feed for: 2025.01.03

There is no news feed for today.
 

The XAU/USD currency pair (gold)

Technical indicators of the currency pair:

• Prev. Open: 2624
• Prev. Close: 2660
• % chg. over the last day: +1.37 %

Gold prices hit a two-week high on Thursday, rising 1.3% to $2,654 per ounce. The rally was fueled by US monetary easing, record central bank purchases, and ongoing geopolitical tensions, including Russian drone strikes in Kyiv on Wednesday and Israeli military action in Gaza. However, gold’s outlook remains mixed as Federal Reserve Chairman Jerome Powell’s warning of further rate cuts, citing renewed inflation risks, has weakened the appeal of this non-income-generating asset. On the other hand, expectations of continued gold purchases by central banks, backed by the World Gold Council survey, may support demand and keep upward pressure on prices.

Trading recommendations

• Support levels: 2638, 2622, 2603, 2570
• Resistance levels: 2664, 2672, 2692

From the point of view of technical analysis, the trend on the XAU/USD is bearish, but the intraday bias is behind the buyers. Yesterday, on a liquidity test above 2638, the price accelerated and rose sharply. This is a sign of a reversal as liquidity accumulated in the 2603-2638 corridor started to distribute higher. Further price growth above the visual highs is expected. Inside the day, it is worth looking for buy trades to continue the growth. There are no optimal entry points for selling now.

Alternative scenario:

if the price breaks above the 2664 resistance level, the uptrend is likely to resume.

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News feed for: 2025.01.03

• US ISM Manufacturing PMI (m/m) at 17:00 (GMT+2).

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