The USD tended to regain some ground on New Year\u2019s Eve and US stocks were at record highs, yet during today\u2019s Asian session the USD opened with a negative gap against a number of its counterparts. Expectations for a rebound in global trade in conjunction with low U.S. interest rates by the Fed, a very high U.S. budget and trade deficit could drive other currencies higher given the boost of prices in commodities and set the greenback on a downward course that seems to have accelerated somewhat. Should the risk on mood of the market continue we could see the USD slipping further as it may continue to experience safe haven outflows. EUR\/USD dropped on Thursday aiming for the 1.2215 (S1) support line, yet during today\u2019s Asian session the pair reversed course. We tend to maintain a bias for a sideways motion given also that he RSI reading below our 4-hour chart is at the reading of 50, implying a rather indecisive market, yet the bulls may be just around the corner should the risk on mood of the market continue. If EUR\/USD finds fresh buying orders along its path, we could see it breaking the 1.2285 (R1) line and aim for the 1.2340 (R2) level. If a selling interest is displayed, we could see EUR\/USD, the 1.2215 (S1) line and start aiming for the 1.2155 (S2) level.<\/p>\n
Gold\u2019s prices started the new year with a jump, by rising to a new high since the start of November and breaking above the key $1,900 level during today\u2019s Asian session, as a weakening USD and a surge in COVID-19 infections and the possibility of stricter coronavirus lockdown measure boosted the precious metal. Some sense of return to normality, especially after the rollout of vaccines is expected to be in the second half of the year, which may imply that uncertainty is to remain at high levels and monetary policy continue to be loose, which may polish the shiny metal further. The next two fundamental events which we note are Georgia\u2019s runoff elections on Tuesday and the release of the Fed\u2019s meeting minutes on Wednesday.
\nXAU\/USD steepened its ascent during todays\u2019 Asian session, aiming for the 1930 (R1) resistance line. We tend to maintain a bullish outlook for the precious metal as the upward movement incepted since the end of November seems to find new dynamics, after a pause mid-December. On the flip side though we would highlight the fact that the RSI indicator below our 4-hour chart has reached the reading of 70, which confirms the bull\u2019s dominance, yet at the same time may be implying that gold\u2019s long position is getting rather overcrowded and some traders may be tempted to book some profits. Should the bulls maintain the momentum, we could see the precious metal breaking the 1930 (R1) line and aim for the 1965 (R2) level. Should the bears be in charge, gold\u2019s prices could break the 1907 (S1) line and aim for the 1877 (S2) level.<\/p>\n
Today during the European session, we note Turkey\u2019s CPI rates for December, December\u2019s final manufacturing Markit PMIs for Germany, the UK, the US and Canada as well as Eurozone\u2019s forward looking Sentix index for January. As for speakers please note that Atlanta Fed President Bostic, Chicago Fed President Evans and Cleveland Fed President Mester are scheduled to speak.<\/p>\n
On Tuesday, we note the US ISM manufacturing PMI for December. On Wednesday, we get France\u2019s and Germany\u2019s preliminary CPI rates for December, Eurozone\u2019s and UK\u2019s final Services and Composite PMI\u2019s for December and the US factory orders for November. On Thursday, we get from Australia the building approvals and trade balance for November, Germany\u2019s industrial orders for November, Eurozone\u2019s preliminary CPI Rates for November, the US weekly initial jobless claims figure, Canada\u2019s trade balance for November and the US ISM services PMI for December On Friday, we note Germany\u2019s industrial output for November, UK\u2019s Halifax house prices for December, the US Employment report for December and Canada\u2019s employment data for the same month.<\/p>\n
EUR\/USD H4 Chart<\/b><\/p>\n
Support:<\/b>\u00a01.2215 (S1), 1.2155 (S2), 1.2100 (S3)<\/p>\n
Resistance:<\/b>\u00a01.2215 (R1), 1.2285 (R2), 1.2340 (R3)<\/p>\n
XAU\/USD H4 Chart<\/b><\/p>\n
Support:\u00a0<\/b>1907 (S1), 1877 (S2), 1850 (S3))<\/p>\n
Resistance:<\/b>\u00a01930 (R1), 1965 (R2), 1992 (R3)<\/p>\n