AUD/USD Breaks Key Support as USD Index Hits Four-Week High

Traders' Opinions

Summary:

The AUD/USD pair falls to near 0.6676 as investors favor the US Dollar ahead of December’s Nonfarm Payrolls data, while soft Australian inflation data undermines RBA rate hike expectations.

SELL AUDUSD

Close Time

CLOSED

0.66800

Entry Price

0.66400

0.67200

0.66822 +0.00020 +0.03%

40.0

Pips

Loss

0.66400

0.67202

Exit Price

0.66800

Entry Price

0.67200

The Australian Dollar (AUD) continued to face selling pressure on Friday, marking its third consecutive day of losses against the US Dollar (USD). During the late European trading session, the AUD/USD pair slipped to 0.6676, reflecting a market increasingly cautious ahead of the United States’ December Nonfarm Payrolls (NFP) report, scheduled for release at 13:30 GMT.

The US Dollar has demonstrated notable resilience in recent sessions, with the US Dollar Index (DXY)—which tracks the Greenback against six major currencies—hovering around 99.10, the highest level in roughly four weeks. Market participants are positioning ahead of the NFP data, which will provide fresh insights into the Federal Reserve’s (Fed) policy trajectory. Recent commentary from Fed officials has underscored a heightened sensitivity to the labor market, with policymakers expressing concern that weakening employment conditions may outweigh inflation risks, even as consumer prices remain above the central bank’s 2% target.

Economists forecast that US employers added 60,000 new jobs in December, slightly below November’s 64,000. The unemployment rate is expected to have fallen to 4.5% from 4.6%, signaling a modest tightening of the labor market. Meanwhile, Average Hourly Earnings—a key gauge of wage inflation—is anticipated to have accelerated to 3.6% on an annualized basis, up from 3.5% in November, with month-on-month growth projected at 0.3%, compared with the previous reading of 0.1%. Should these figures surprise to the upside, the USD may see additional support, reinforcing the AUD/USD’s downtrend.

Compounding the Greenback’s strength is the softening outlook for the Australian Dollar. The antipodean currency has come under pressure following November’s Consumer Price Index (CPI) report, which revealed a year-on-year inflation reading of 3.4%, below the 3.7% forecast and down from October’s 3.8%. This weaker-than-expected inflation print has prompted investors to scale back expectations for Reserve Bank of Australia (RBA) hawkishness at the February policy meeting. According to Reuters, the probability of a rate hike by the RBA in February now stands at just 24%, underscoring diminished confidence in further tightening.

Technical Analysis

From a technical perspective, the AUD/USD’s recent decline represents a decisive bearish breakout below the lower boundary of its ascending channel, signaling a potential shift in market sentiment. The bullish impulse that commenced on 5 January, previously marked by a short-term upward trend, has been fully neutralized by the current selling wave. Price action now suggests that sellers are firmly in control, and any attempt by bulls to push the pair back into the channel may encounter resistance around 0.6720, the level from which the sharp sell-off began on 8 January.

This technical configuration highlights the dominance of bearish momentum, with key support levels near 0.6660 and 0.6640 likely to be tested if selling pressure persists. Traders may also watch closely for a reaction to the US NFP report, which has the potential to either reinforce the USD’s strength or provide temporary relief for the AUD.

TRADE RECOMMENDATION

SELL AUDUSD

ENTRY PRICE: 0.6680

STOP LOSS: 0.6720

TAKE PROFIT: 0.6640

Risk Warnings and Disclaimers

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Warren Takunda

Traders' Opinions

Summary:

The euro slid for a seventh straight session against the dollar as mixed US labor data reinforced a cautious Federal Reserve outlook, leaving EUR/USD technically vulnerable and biased to the downside.

SELL EURUSD

Close Time

CLOSED

1.16250

Entry Price

1.15400

1.16700

1.16386 -0.00033 -0.03%

45.0

Pips

Loss

1.15400

1.16700

Exit Price

1.16250

Entry Price

1.16700

The euro remained under pressure against the US dollar on Friday, extending its decline for a seventh consecutive trading session as investors digested a mixed set of US labor-market figures that ultimately favored the greenback. The EUR/USD pair was trading near 1.1638 at the time of writing, struggling to stabilize as the dollar retained broad-based support amid resilient US macro fundamentals and persistent policy divergence expectations.

Figures released by the US Bureau of Labor Statistics offered a nuanced snapshot of labor-market conditions. Nonfarm Payrolls increased by 50,000 in December, undershooting market expectations for a 60,000 rise and marking a slowdown from November’s 64,000 gain. While the headline job creation number pointed to a cooling pace of hiring, it stopped short of signaling any abrupt deterioration in employment conditions.

More supportive for the dollar was the unexpected improvement in the Unemployment Rate, which fell to 4.4% from 4.6%, beating forecasts that had penciled in a modest decline to 4.5%. The lower jobless rate suggests that labor demand remains firm enough to absorb slower hiring, reinforcing the view that the US economy is decelerating gradually rather than slipping into a pronounced downturn.

Wage data added another layer of complexity to the report. Average Hourly Earnings rose 0.3% month-on-month in December, in line with expectations and a notable pickup from November’s 0.1% increase. On an annual basis, wage growth accelerated to 3.8% from 3.6%, exceeding market forecasts. This acceleration in pay growth continues to underscore the stickiness of labor-related inflation pressures, an issue that remains central to the Federal Reserve’s policy calculus.

Taken as a whole, the employment report sent mixed but not alarming signals. Softer payroll growth contrasted with a tighter unemployment rate and firmer wage momentum, pointing to a labor market that is cooling at the margins while remaining fundamentally resilient. For currency markets, this balance has been sufficient to keep the dollar underpinned, particularly against a euro that lacks near-term supportive catalysts.

From a monetary policy perspective, the data reinforced expectations that the Federal Reserve will maintain a cautious stance. Markets remain confident that policymakers will leave interest rates unchanged at the January 27–28 FOMC meeting, while continuing to emphasize a data-dependent approach toward any rate cuts later in the year. Importantly, the combination of slower hiring and rising wages gives the Fed room to stay patient, avoiding premature easing that could reignite inflation pressures.

By contrast, the euro continues to be weighed down by uncertainty surrounding the Eurozone growth outlook and the European Central Bank’s likely policy trajectory. With inflation in the bloc easing more convincingly and growth indicators remaining fragile, investors increasingly expect the ECB to move toward rate cuts earlier than the Fed. This widening policy divergence has been a persistent headwind for the single currency and remains a key driver behind EUR/USD’s extended decline.

Attention now turns to the University of Michigan’s preliminary January Consumer Sentiment survey, which could provide fresh insight into US household confidence and inflation expectations. In addition, remarks from Richmond Fed President Thomas Barkin and Minneapolis Fed President Neel Kashkari will be closely watched for clues on how comfortable policymakers are with the current disinflation trend and whether wage growth is becoming a renewed concern. Any indication of lingering hawkishness could further reinforce the dollar’s advantage.

Technical Analysis

From a technical standpoint, the outlook for EUR/USD remains decisively bearish despite early signs of short-term exhaustion. The pair continues to trade below its 50-period exponential moving average, highlighting persistent negative momentum on an intraday basis. Price action remains confined within a downward-sloping channel, confirming that the broader move is corrective in nature but still firmly biased to the downside.

Momentum indicators, including relative strength measures, are stabilizing near oversold territory, suggesting that selling pressure may temporarily ease. However, such signals typically point to consolidation or shallow rebounds rather than a meaningful trend reversal. As long as the pair fails to reclaim the upper boundary of its descending channel, any recovery is likely to be corrective and vulnerable to renewed selling interest.

In practical terms, downside risks remain skewed toward a continued grind lower, with price action still gravitating toward lower liquidity zones within the prevailing structure. Bounces that lack follow-through and fail to attract sustained buying interest are likely to be viewed by market participants as opportunities to re-establish short positions rather than evidence of a shift in trend.

TRADE RECOMMENDATION

SELL EURUSD

ENTRY PRICE: 1.1625

STOP LOSS: 1.1670

TAKE PROFIT: 1.1540

Risk Warnings and Disclaimers

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Eva Chen

Commodity

Summary:

Ahead of the release of U.S. nonfarm payrolls data, market sentiment is dominated by wait-and-see attitudes, with gold prices fluctuating in a sideways range. Compared with the November figures, the December nonfarm payrolls report is expected to more accurately reflect the actual conditions of the U.S. labor market and provide a more valuable basis for subsequent economic and policy judgments.

BUY XAUUSD

Close Time

CLOSED

4483.45

Entry Price

4632.00

4373.00

4617.47 +31.37 +0.68%

1036.4

Pips

Profit

4373.00

4587.09

Exit Price

4483.45

Entry Price

4632.00

Fundamentals

During the first half of the European trading session on Friday, gold prices edged lower, but the overall decline was limited. With investors widely adopting a wait-and-see stance ahead of the highly anticipated U.S. nonfarm payrolls data release, gold lacked clear directional momentum.

The upcoming U.S. employment data is regarded as a key reference for judging the Fed's future interest rate cut path, which also makes it one of the core factors affecting the short-term trend of the U.S. dollar. Driven by risk aversion ahead of the data release, the U.S. dollar extended its upward trend over the previous two weeks and hit a one-month high, exerting certain downward pressure on gold prices.

Nevertheless, from a medium-term perspective, market expectations for further interest rate cuts by the Fed are still rising, coupled with persistent geopolitical uncertainties. These factors together provide bottom support for gold as a safe-haven asset. Against the backdrop of intertwined bullish and bearish fundamental factors, investors tend to hold off on new directional bets, resulting in a sideways trading pattern for gold prices overall.

From a macroeconomic perspective, although the U.S. labor market still shows signs of slowing recruitment and rising layoffs, a comprehensive analysis of various data indicates that the most severe phase of economic slowdown may have passed. Compared with previous data, the December employment report is expected to more clearly reflect the current true state of the labor market.

It is worth noting that the longest government shutdown in history significantly disrupted the employment data for October and November, to some extent undermining their original status as the "gold standard" reference. At present, it is still impossible to fully confirm whether the relevant impacts have completely subsided, so caution is still needed when interpreting the data in the short term. However, it is relatively certain that the December nonfarm payrolls data will be more representative than the November figures overall, providing a clearer basis for the market to judge the current state of the U.S. economy.

Focus on the U.S. December Nonfarm Payrolls Report_1

Technical Analysis

Gold prices failed to sustain the upward momentum from the previous trading day on Friday, experiencing a temporary pullback and approaching the top of the intraday trading range ahead of the European trading session. In fact, this pause in the rally is related to the insufficient depth of the pullback in the previous trading day, as well as the market's wait-and-see sentiment ahead of the nonfarm payrolls data release.

From a structural perspective, regardless of the direction gold prices move after the nonfarm payrolls data release, there will be rationales to support it. First, a downward movement has the demand for price retracement, given that the gap caused by Monday's gap-up opening has not been fully filled. Second, for an upward movement, the conditions for a head-and-shoulders bottom pattern have matured, and a breakthrough above the previous high of $4,550 is also a high-probability event. For this reason, range trading with buying low and selling high remains the conventional operation strategy.

Trade Recommendations

Trade Direction: Buy

Entry Price: 4435

Target Price: 4632

Stop Loss: 4373

Valid Until: 07, February, 2026, 23:55:00

Support: 4435/4403/4374

Resistance Levels: 4485/4500/4527

Risk Warnings and Disclaimers

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Tank

Forex

Technical Analysis

Summary:

Recent wage, employment and inflation releases from Japan and the U.S. confirm synchronous labour-market cooling across major economies, but with divergent speed and scale, materially reshaping the monetary-policy outlook. Heightened Sino-Japanese tensions add external pressure to the yen.

BUY USDJPY

EXP

PENDING

157.000

Entry Price

160.000

155.000

159.356 +0.198 +0.12%

Pips

PENDING

155.000

Exit Price

157.000

Entry Price

160.000

Fundamentals

The government's preliminary November data show real cash earnings fell 2.8%YoY—the steepest drop since Jan. 2025 and the eleventh consecutive decline—driven by a 17% YoY plunge in special cash earnings (one-off bonuses). Nominal wages rose just 0.5% YoY, the weakest since Dec. 2021.

The MHLW stresses that special payments are volatile in non-bonus months and November prints are typically revised up. Underlying momentum remains intact: base pay +2.0%YoY, overtime +1.2%YoY. Inflation continues to outpace wages. The CPI index used to deflate earnings advanced 3.3% YoY, above core gauges.

With real incomes squeezed, the BoJ lifted the policy rate to 0.75% last month—its highest in three decades—and expects sustained wage gains in the 2026 shuntō negotiations. Rengo has tabled a 5%-plus total wage increase target.

In the U.S. the labor market is cooling, not cracking. Seasonally-adjusted initial claims rose 8,000 to 208k,000 in the week ending 27 Dec—still a historic low. Holiday noise dominates the recent volatility, and layoff volumes remain contained. Hiring is on hold: tariff uncertainty and faster AI adoption keep recruiters sidelined, producing a low-turnover stalemate. Structural stress is nevertheless building.

Challenger, Gray & Christmas report U.S. employers announced 1,206,000 job cuts in 2025, +58% YoY and a five-year high, driven by federal downsizing and tech-sector cost rationalization. Years of over-hiring plus rapid AI transition are accelerating tech attrition. Hiring plans are down 34% YoY to the lowest level since 2010, raising the risk of longer spells of unemployment. Continuing claims have climbed to 1914,000, job openings have fallen to a 14-month low, and the vacancy-to-unemployed ratio has dropped to 0.91, its lowest since Mar. 2021.

Against this backdrop, the Chicago Fed estimates the December unemployment rate stayed at 4.6%. Policymakers treat this threshold as consistent with further monetary easing. Reuters-surveyed economists expect the official rate to edge down to 4.5%.

Technical Analysis

Daily: Bollinger Bands on USDJPY have contracted and flattened. The EMA12 is horizontal. A large bullish candle on 19 Dec 2025 closed above the upper band, and price has since tracked the EMA12 higher, re-entering a short-term uptrend with a high-probability retest of 158–160. MACD fast and slow lines have pulled back to zero and re-crossed bullishly, re-confirming a long signal. RSI 59 with rising lows keeps buyers in control, with the support at 156-157.

Weekly: Price oscillates around the EMA12 within the ascending channel. While this EMA holds, a move toward 160 is anticipated. MACD is shaping a "golden-kiss" re-cross. RSI 67, bullish bias intact. At this moment, traders are advised to go long at lows.

Trade Recommendations

Trade Direction: Buy

Entry Price: 157

Target Price: 160

Stop Loss: 155

Support: 154.7/153.2/150

Resistance Levels: 158/158.8/160

Risk Warnings and Disclaimers

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Gerik

Forex

Economic

Summary:

CAD/CHF is trading around ~0.576–0.578, remaining near its recent intraday range highs/low within a subtle sideways drift. Despite modest strength in the Canadian dollar recently...

SELL CADCHF

EXP

EXPIRED

0.57750

Entry Price

0.57400

0.58100

0.57688 +0.00035 +0.06%

Pips

EXPIRED

0.57400

0.57445

Exit Price

0.57750

Entry Price

0.58100

Overview

CAD/CHF trades near 0.576–0.578, with today’s intraday range roughly 0.5756–0.5794. This consolidative price action reflects the Canadian dollar’s mixed sentiment against the Swiss franc the CAD has been modestly supported by expectations of relative central bank positioning, but this hasn’t translated into strong trend continuation.

Recent Reuters highlights that analysts see the Canadian dollar potentially strengthening longer term on improved trade optimism and relative monetary policy expectations (e.g., BoC possibly ending easing); however, this is a longer horizon view and doesn’t preclude short-term retracements or weak momentum days.

The broader FX data show that CAD/CHF has contracted over recent months and years, with the pair down notable percentages year-on-year an indication that the CHF (typically defensive) has pressured CAD across cycles, and the current levels are not significantly strong on their own.

Market sentiment

On the M15 timeframe, sentiment lacks strong directional conviction and reflects choppy, range-bound conditions. Price has been unable to decisively break above 0.579–0.580 resistance, and the narrow daily range implies that buyers are not firmly driving momentum higher. Traders often interpret this type of structure where price hesitates near the upper end of a range as a potential setup for a corrective sell-off or continuation of the broader downtrend, assuming macro catalysts don’t suddenly favor CAD.

In addition, technical sentiment indicators from forex analysis (RSI, MACD, short-term moving averages) lean bearish for CAD/CHF with RSI below neutral and MACD showing downward elements suggesting sellers may be building short exposure or bulls are taking profits near recent highs.

Technical analysis

Because live chart indicators (e.g., actual Ichimoku/Stoch readings) aren’t directly available via current search, this technical analysis focuses on standard key patterns and price action validated by real-time data.

Price structure: CAD/CHF has held below ~0.580, failing to extend above short-term resistance; repeated attempts are being capped near that upper band. This tends to signify temporary exhaustion of upside momentum on shorter timeframes.

Support/resistance levels: According to FX technical feeds, key short-term supports cluster around 0.575, 0.574, and 0.573, while resistances sit near 0.578–0.580 a narrow band where price action is currently congested.

If the pair breaks below immediate support (~0.575) on M15 with follow-through selling, it strengthens the bearish case and opens room for key corrective targets near the lower cluster (~0.573 and below).

Trend context: Although some longer-term models suggest CAD/CHF may see gradual upside later in 2026, short-term technical signals (bearish indicators, sideways action near resistance) favor sellers for today’s timeframe.

Trade recommendation

Entry: 0.5775

Take Profit: 0.5740

Stop Loss: 0.5810

Risk Warnings and Disclaimers

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Gerik

Forex

Economic

Summary:

GBP/JPY is trading around ~211.2 after recent attempts to push above the 211.4–211.6 zone stalled, with price failing to sustain breakouts above intraday highs...

SELL GBPJPY

Close Time

CLOSED

211.350

Entry Price

210.500

212.100

213.929 +0.332 +0.16%

75.0

Pips

Loss

210.500

212.100

Exit Price

211.350

Entry Price

212.100

Overview

GBP/JPY is currently trading near ~211.2, with today’s intraday range roughly 210.64–211.28. Price has been encountering resistance near 211.4–211.6 on multiple attempts, with the pair unable to sustain upside momentum beyond that level.

Macro backdrops that may be compressing upside include a strengthening US dollar as traders anticipate key U.S. payrolls data — typically boosting the dollar at the expense of other currencies — and relative caution in GBP flows despite recent pound strength. Reuters notes the dollar’s advance at the start of today’s session as traders await jobs figures and a potentially market-moving Supreme Court ruling, which has broad implications for risk sentiment.

Meanwhile, expectations of continued Bank of Japan tightening (with rate increases if data aligns) keep JPY supported at times, reducing the appeal of prolonged GBP/JPY rallies. This creates an environment where short-term rallies are met with selling pressure near resistance.

Market sentiment

On the M15 timeframe, sentiment shows buyers struggling to extend beyond the upper intraday range, with GBP/JPY failing multiple times to break and hold above 211.4. This behavior suggests that momentum is waning near resistance and that short-term bullish bets may be paused or unwind as orders hit limits without follow-through. Technical price action with hesitation at the highs often precedes corrective moves, especially in thin liquidity periods and in the absence of fresh catalysts supporting additional upside.

Profit-taking from recent range highs is a common pattern before deeper pullbacks on crosses like GBP/JPY, particularly when broader market sentiment shifts toward a firmer dollar and risk assets face selling pressure in anticipation of macro data.

Technical Analysis

Bollinger Bands (20,0,2): On M15, GBP/JPY has repeatedly tested the upper band near 211.3–211.6 without sustaining breaks, indicating that upside volatility is exhausted at that resistance and that a mean reversion pullback toward the mid-band is plausible.

Ichimoku (9,26,52): Price stalling near the cloud/Kijun levels on intraday charts suggests that dynamic equilibrium is being respected as resistance rather than support. Rejected retests of these dynamic zones tend to favor short-term sellers.

Stoch (5,3,3): Intraday stochastic readings are likely rolling over from higher zones after recent tests of resistance — a classic early signal of weakening upward momentum. A bearish crossover near mid-range supports short-term corrective bias.

Key intraday levels:

Resistance (sell trigger area): 211.35–211.60 — recent rejection cluster

Immediate support: 210.50–210.80 — pivot zone and lower BB area

Deeper support: 209.80–210.10 — next logical target if selling accelerates

Trade recommendation

Entry: 211.35

Take Profit: 210.50

Stop Loss: 212.10

Risk Warnings and Disclaimers

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Manuel

Central Bank

Economic

Summary:

The price is approaching a critical confluence of technical indicators that could serve as a launchpad for the next bullish leg.

BUY AUDUSD

Close Time

CLOSED

0.66800

Entry Price

0.67400

0.66500

0.66822 +0.00020 +0.03%

27.2

Pips

Profit

0.66500

0.67072

Exit Price

0.66800

Entry Price

0.67400

Recent data from the Australian Bureau of Statistics (ABS) reveals that the nation's trade surplus narrowed significantly to AUD 2.936 billion in November, a sharp decline from the AUD 4 billion recorded in the previous month. This contraction was primarily driven by a 2.9% monthly drop in exports, reversing October’s gains, while imports experienced a marginal increase. These figures have sparked growing concerns regarding the net contribution of foreign trade to Australia's overall economic growth as the year comes to a close.

Furthermore, softer-than-expected inflation data released earlier this week has placed additional downward pressure on the Australian Dollar. The Consumer Price Index (CPI) recorded a 3.4% year-over-year increase in November, undershooting market expectations and marking a deceleration from the prior month. While inflation remains stubbornly above the Reserve Bank of Australia’s (RBA) target range, this slowdown introduces fresh uncertainty regarding the future path of monetary policy. RBA Deputy Governor Andrew Hauser noted that the figures were largely in line with internal forecasts, reiterating that immediate rate cuts remain unlikely as the central bank maintains a strictly data-dependent stance.

In the United States, the latest ADP Employment Change report showed that private payrolls expanded by 41,000 in December. Although this figure missed the consensus forecast of 47,000, it represents a substantial recovery compared to the 29,000 jobs lost in November, suggesting a tentative stabilization in hiring as the year closed. In tandem, the U.S. Department of Labor’s JOLTS report showed that job openings retreated to 7.146 million in November, down from October’s 7.449 million, signaling a gradual cooling in broad labor demand.

Providing a counterweight to the softening labor data, the Institute for Supply Management (ISM) reported a notable surge in the Services PMI, which climbed from 52.6 to 54.4 in December, easily beating the 52.3 estimate. A granular look at the data shows the Employment index returning to expansion at 52, while the Prices Paid component saw a slight moderation. This blend of resilient service sector activity and cooling labor metrics keeps the Federal Reserve in a cautious "wait-and-see" posture ahead of their late-January meeting. While service strength discourages aggressive monetary easing, the labor slowdown continues to build a fundamental case for gradual rate reductions.

Finally, market participants largely overlooked the dovish commentary from Fed Governor Stephen Miran, as traders had already priced in two rate cuts according to Prime Market Terminal data. Meanwhile, U.S. Treasury Secretary Scott Bessent exerted pressure on Federal Reserve officials, arguing that interest rate cuts should not be delayed if the goal is to successfully stimulate economic growth. Technical Confluence and Key Support Rejection Point Toward a New Bullish Impulse_1

Technical Confluence and Key Support Rejection Point Toward a New Bullish Impulse_1

Technical Analysis

The AUD/USD remains locked in a clear primary uptrend; however, it is currently undergoing a corrective retracement phase. The price is approaching a critical confluence of technical indicators that could serve as a launchpad for the next bullish leg.

Historically, the pair has found significant buying interest whenever it approaches the 200-period Moving Average (MA), which currently sits at 0.6676 on the 2-hour chart. Meanwhile, the 100-period MA is positioned slightly higher at 0.6703. Should the price repeat its previous behavior, we could witness a strong bullish reversal as it tests the 200-period MA.

This zone is further reinforced by a significant horizontal support level at 0.6678. This area previously functioned as a firm resistance ceiling; its transformation into a support floor—a classic support-resistance flip—adds substantial weight to the bullish thesis.

Additionally, the Relative Strength Index (RSI) is rapidly approaching oversold territory. This extreme reading is likely to attract institutional and retail buyers looking to capitalize on the technical convergence of the horizontal support, the 200-period MA, and the primary ascending trendline. If these levels hold, the stage is set for a decisive extension of the bullish trend.