The UK’s economic output in November exceeded expectations, providing a modest boost to the growth outlook at the end of the year. GDP rose 0.3% MoM, higher than the previously expected flat reading, with the service and manufacturing sectors registering the strongest growth.

Service sector output increased by 0.3% MoM, and manufacturing output climbed 1.1% MoM, offsetting a sharp 1.3% MoM decline in construction activity. Data shows that despite the ongoing slump in the construction sector, growth momentum in consumer and business-oriented industries is improving.

In the three months to November, GDP edged up 0.1%. The service sector grew by 0.2%, while manufacturing output slipped 0.1%, mainly dragged down by weakness in the automotive manufacturing industry. Construction output also fell by 1.1%. On a YoY basis, GDP expanded by 1.3%, driven by a 1.4% growth in the service sector. Manufacturing output rose 0.4% YoY, and construction output grew 0.7% YoY.

Market Watch: The return of UK economic growth in November has lowered the probability of a rate cut by the BoE in February. The 0.3% MoM GDP growth in November has given sufficient confidence to monetary policy committee members who still worry about inflation to hold off on voting for accommodative policies amid the current economic conditions. Current data indicates that the UK economy achieved modest growth in Q4 2025. The easing of uncertainty following the budget announcement may have underpinned December’s growth. However, the return to economic growth may not trigger a sustained recovery. Despite the boost from falling inflation, weak consumer spending and rising tax burdens may translate into more sluggish economic growth in 2026.

GBPUSD held above the 1.3400 level during the European trading session on Thursday, having earlier surged to near 1.3450. The currency pair staged a rally buoyed by upbeat UK economic growth and industrial data, but the upward momentum failed to sustain amid broad-based US dollar strength.

At present, market focus remains glued to fluctuations in the counterpart currency (the US dollar) for further guidance. Although Trump stated that Iran’s "killing spree" has stopped, which may signal a pause in military action against Iran, many of Trump’s policies are moving forward in terms of implementation. Should the US press ahead with strikes against Iran, it would trigger sharp volatility in the US dollar.

GBPUSD is currently stuck in a range-bound trading pattern, with the intraday trend remaining neutral. On the upside, a breakout above 1.3567 may extend the uptrend from the 1.3008 level, with the next target set at the 1.3787 high.

On the downside, a break below 1.3389 could prolong the downtrend from 1.3567. A sustained breach of the MA55 (currently at 1.3375) would signal that the current decline is another leg down in the correction from the 1.3787 peak. In this scenario, GBPUSD may drift further lower toward the 1.3008 support level.

Trade Direction: Buy

Entry Price: 1.3389

Target Price: 1.3787

Stop Loss: 1.3240

Valid Until: 12, February, 2026, 23:55:00

Support: 1.3389/1.3323/1.3249

Resistance Levels: 1.3495/1.3533/1.3569

Gold prices experienced a short-term correction after a recent period of robust appreciation and record-breaking highs, driven by two primary forces.

The first force involves macroeconomic and policy factors: weakening U.S. inflation and employment data, mounting market expectations for future Federal Reserve interest rate cuts, and political shocks threatening the Fed’s independence have collectively created a safe-haven demand and increased uncertainty regarding monetary policy, providing a strong bullish foundation for gold.

The second force pertains to liquidity conditions and technical analysis: substantial long-term gold ETF inflows since late 2023 have solidified the bullish base, while short-term capital has taken profits and rebalanced near record highs. Additionally, news cycles in U.S. trading hours have contributed to a pattern of upward movements followed by retracements, reflecting typical market behavior. The sustained net inflows into ETFs and intraday capital flows remain critical indicators for predicting the continuation of the bullish trend.

In the 4H timeframe, the overall candlestick movement of gold maintains a clear bullish upward trend. While the short-term SMAs are consolidating, the medium- and long-term SMAs remain in a bullish alignment, indicating that the medium- to long-term trend continues to be bullish. Although recent short-term retracement occurred today, prices recovered and closed above the MA20, suggesting a significant reinforcement of the bullish momentum and increasing the likelihood of continued upward movement.

Currently, gold is supported around the 4580 level, with prospects for an ongoing upward trend toward the 4640 resistance level. A break above this resistance could open the path toward the 4700 target zone. Conversely, if gold falls below 4580, a deeper correction is likely, with the initial support level at 4550.

Trading Direction: Buy

Entry Price: 4600.00

Target Price: 4720.00

Stop Loss: 4510.00

Valid Until: January 29, 2026 23:00:00

Support: 4580.00, 4550.00

Resistance: 4700.00, 4728.00

The Bank of Japan (BOJ) recently refrained from signing a joint statement by multiple central banks supporting Federal Reserve Chair Powell, drawing market attention. This decision is widely interpreted as continuing its long-standing tradition of avoiding political and controversial issues, while also being closely tied to Japan's current domestic political environment. Multiple government sources revealed that the BOJ informally sought the government's opinion on whether to sign the statement, but failed to obtain clear support amid time constraints and sensitivity in Japan-U.S. relations. Relevant officials worried that a public stance might trigger unnecessary friction with the U.S. as Japan faces an early general election. Although BOJ Governor Ueda Kazuo has repeatedly emphasized the importance of central bank independence, he has not publicly responded to remarks by the Trump administration attacking the Fed. Analysts noted that this cautious attitude aligns with the BOJ's consistent style and reflects that it is not entirely immune to political influence. Affected by the Japanese government's deep historical involvement in monetary policy, the BOJ is particularly restrained when dealing with overseas political disputes. Former BOJ Policy Board member Takahide Kiuchi believes that in the current environment, maintaining silence externally is seen as the safest option, especially to avoid additional pressure on the Japanese government from the Trump camp. With Prime Minister Takaichi Sanae's trade policies still in effect, the yen's recovery momentum is expected to be limited. Market experts have already priced in expectations of Takaichi Sanae winning the early general election. Takaichi Sanae is expected to announce the election results after dissolving the House of Representatives next week. Her victory will help secure support for her budget proposal, which is expected to include higher spending plans—beneficial for Japanese stocks but unfavorable for the yen.

On the U.S. side, November retail sales rose more than expected, indicating robust growth momentum in the fourth quarter, driven mainly by a rebound in auto sales and increased household spending across multiple sectors. However, economists pointed out that consumption growth shows a clear "K-shaped divergence": high-income groups supported the overall data, while low-income households faced greater pressure from rising prices of necessities like food, closely linked to the Trump administration's comprehensive tariff policies. Meanwhile, the U.S. Producer Price Index (PPI) recovered moderately, with rising energy costs as the main driver. However, companies absorbed some costs by compressing profit margins, curbing further inflation. Financial markets reacted relatively mildly to these data: the dollar failed to extend its previous rally, U.S. Treasury yields retreated, and traders continued to weigh prospects for Fed policy and geopolitical risks. Although the market generally expects the Fed to keep interest rates unchanged in the coming months, political pressure on Powell still casts a shadow over the dollar's outlook. Concerns about potential damage to Fed independence once intensified but have recently eased.

Regarding the daily chart, the Bollinger Bands are expanding upward, the moving averages are diverging higher, and prices are rising strongly along the Bollinger Upper Band. After the golden cross, upward momentum remains intact. Overall, there is a high probability of testing 160 and 162. The RSI stands at 63, with lows gradually rising, indicating investors are predominantly buying. Based on the 4-hour chart, prices fluctuate upward along the Bollinger Upper and Middle Bands, remaining within an upward trend channel. As long as prices fail to break below the Bollinger Middle Band effectively, they are expected to test 160. After forming a death cross, the MACD and signal lines are pulling back toward the 0-axis but remain some distance away, suggesting adjustments are incomplete. Support levels are at 158 and 157.8. The RSI is at 57, placing the market in a wait-and-see zone. Buying at lows is recommended.

Trading direction: Buy

Entry Price: 158.6

Target Price: 162

Stop Loss: 156.5

Support: 157.5/156.5/155

Resistance: 160/161/162

The Swiss Franc continues to find underlying support rooted in shifting expectations regarding the Swiss National Bank (SNB). Swiss inflation edged up to 0.1% year-over-year in December, marking its first acceleration since July. Despite this uptick, the reading remains near the lower boundary of the central bank's 0% to 2% target range. This economic landscape reinforces the consensus that the SNB will likely maintain its policy rate at 0% in the coming sessions, with inflation projected to rise marginally alongside a broader economic recovery.

Simultaneously, major credit rating agencies are keeping a vigilant eye on U.S. institutional stability. Fitch Ratings recently reiterated that the independence of the Federal Reserve is a fundamental pillar supporting the U.S. sovereign credit rating. Similarly, S&P Global Ratings emphasized that the Fed's credibility is a cornerstone of American institutional strength. These high-level declarations serve to maintain a persistent political risk premium embedded within the U.S. Dollar.

Recent labor market data added a layer of complexity as Nonfarm Payrolls (NFP) grew by 50,000, missing the market forecast of 60,000 and decelerating from the previous month’s 56,000. Despite the slower hiring pace, the unemployment rate tightened to 4.4%. Inflationary signals were equally mixed; while the monthly Core PPI stagnated at 0%, the annual figure climbed to 3%, surpassing estimates. On the consumer side, November Retail Sales rose by 0.6% month-over-month, beating the 0.4% projection and rebounding from October’s contraction.

Federal Reserve officials remain divided on the path forward. Atlanta Fed President Raphael Bostic noted that inflation remains far from target, requiring restrictive policy, while Neel Kashkari of Minneapolis highlighted a stabilizing labor market amidst resilient growth. Conversely, Governor Miran and Philadelphia’s Anna Paulson adopted a more dovish tone, with Miran reiterating the need for 150 basis points of easing this year and Paulson suggesting the 2% target could be reached by year-end. Amidst these conflicting views, Chicago Fed President Austan Goolsbee underscored that central bank independence remains the vital key to maintaining price stability.

The USD/CHF pair has been locked in a decisive bullish trend since bottoming at 0.7861 on December 24th. However, this recovery is now approaching its most significant technical challenge to date: a long-term descending trendline originating from November 5th of last year.

This trendline is characterized by a persistent series of "lower highs," indicating a dominant bearish structure on the higher timeframes. The price is currently gravitating toward the 0.8040 zone, where this trendline resistance converges. If the pair exhibits a bearish reaction at this juncture, it would likely signal the start of a healthy correction, as buyers take profits at a major historical pivot.

From a momentum perspective, the Relative Strength Index (RSI) is currently hovering at 53. Being near neutral territory, the indicator suggests there is still room for a final push toward the trendline. This would likely drive the RSI into overbought levels, creating a much more attractive entry point for sellers looking to capitalize on a rejection.

Furthermore, the 100 and 200-period Moving Averages are situated at 0.7938 and 0.7972, respectively. While they are currently trending below the price and supporting the immediate bullish impulse, they would act as primary downside targets and dynamic support zones in the event of a successful corrective reversal from the 0.8040 resistance area.

Trading direction: Sell

Entry price: 0.8040

Target price: 0.7970

Stop loss: 0.8080

Validity: Jan 27, 2026 15:00:00

During Wednesday's Asian and European trading sessions, precious metals markets extended their gains, with gold maintaining its strength amid safe-haven demand. Market attention focused on large-scale protests erupting across Iran, an event significantly heightening geopolitical uncertainty in the Middle East.

The U.S. has signaled potential intervention. On Tuesday, President Trump twice publicly told protesters opposing the Iranian government that “help is on the way,” which markets interpreted as a precursor to further U.S. government action. These statements have heightened market expectations of escalating tensions.

Against the backdrop of rising geopolitical risk premiums, risk asset sentiment has turned cautious, with capital flowing toward defensive and safe-haven assets. As a non-sovereign credit asset, gold has regained allocation demand, gaining relative strength against the U.S. dollar.

Historically, political turmoil in the Middle East has tended to provide medium-to-short-term support for gold prices while having a relatively limited impact on the U.S. dollar. As long as the situation remains unclear and the possibility of U.S. intervention persists, geopolitical risks will continue to be a key driver influencing gold prices.

Based on recent price momentum and geopolitical developments, the probability of spot gold breaking through US$5,000 per ounce this year now exceeds 30%. By 2026, gold will be well-positioned, supported by factors including a surge in global debt burdens, the trajectory of Federal Reserve policy, and potential volatility shocks.

We believe that the correlation between U.S. equities and bonds may remain positive in 2026, creating room for gold allocation within investment portfolios as investors may seek liquid alternatives. Meanwhile, central bank demand for gold is expected to support physical demand, providing a stabilizing anchor for the precious metals market.

In the 4H timeframe, gold is currently consolidating near US$4,635. The upward move is expected to extend toward the US$4,700 level, followed by a potential pullback for correction below US$4,500. A break below this level could trigger further downside toward US$4,430.

The MACD indicator supports a bullish outlook, with its signal line turning upward and advancing toward new highs, indicating sustained upward momentum.

Trading Direction: Buy

Entry Price: 4525

Target Price: 4740

Stop Loss: 4496

Valid Until: February 11, 2026 23:55:00

Support: 4615, 4585, 4573

Resistance: 4652, 4685, 4700

The EUR/JPY currency pair extended its winning streak for a fourth consecutive session on Wednesday, climbing to fresh all-time highs around 185.40 during early European trading hours. The cross has benefited from persistent Japanese yen weakness, driven by a combination of monetary policy uncertainty, fiscal concerns, and looming political developments in Japan, while the euro gains traction from signals that the European Central Bank (ECB) may be nearing the end of its rate-cutting cycle.

Bank of Japan Governor Kazuo Ueda reaffirmed on Wednesday that the central bank is prepared to adjust its interest rate policy should economic conditions and price dynamics meet expectations, particularly if wage growth and price inflation continue to rise moderately. Ueda’s comments, reported by Bloomberg, underscore the BoJ’s cautious stance amid persistent inflationary and growth pressures, leaving markets speculating on the future trajectory of Japanese monetary policy.

However, recent private sector data have painted a more cautious picture. Surveys indicate that Japan’s manufacturing activity has slowed, impacted by global trade frictions, while the services sector faces challenges from tourism-related disruptions. These headwinds constrain the BoJ’s ability to implement aggressive rate hikes, leaving the yen vulnerable to further depreciation.

Adding to the downward pressure, market participants are closely watching potential political developments. Reports suggest that Japanese Prime Minister Sanae Takaichi may call a snap election next month, with a Lower House vote tentatively scheduled for February 8. Analysts argue that such a move could enable Takaichi to consolidate power and pursue more aggressive fiscal stimulus measures, potentially weighing further on the yen. Finance Minister Satsuki Katayama echoed these concerns earlier this week, noting during a bilateral meeting with US Treasury Secretary Scott Bessent that the Japanese government is wary of the yen’s “one-sided depreciation.”

On the other side of the trade, the euro has benefited from encouraging macroeconomic data in the Eurozone. Headline inflation slowed to 2.0% in December, hitting a four-month low and aligning closely with the ECB’s 2% target, while core inflation eased slightly to 2.3%, marginally below market expectations. These developments support the view that the ECB may be close to completing its rate-cutting cycle, lending stability to the euro and enhancing the appeal of EUR/JPY trades for investors seeking relative yield advantages.

From a technical perspective, EUR/JPY has encountered some resistance around the 184.55 level, prompting a period of sideways consolidation. The pair has formed a temporary trading range as it contends with a mildly negative stochastic oscillator, which has settled below the 80 level, indicating that the bullish momentum is facing short-term exhaustion.

Traders may expect EUR/JPY to continue a pattern of temporary lateral movement until the pair can gather sufficient upward momentum. Should the cross maintain support above 184.85 and successfully breach the 184.55 barrier, the path could open for further gains, with the next target potentially near the 161.8% Fibonacci extension level around 190.00. Current technical signals suggest that the overall trend remains bullish, but short-term consolidation is likely before the next leg higher.

BUY EURJPY

ENTRY PRICE: 185.00

STOP LOSS: 182.00

TAKE PROFIT: 190.00