For Canada, economic performance in 2025 can be described as "stable but with concerns." Although trade tensions with the United States were once seen as a potential trigger for recession, GDP still maintained positive growth, albeit slowing noticeably toward year-end. The labor market remained resilient, with unemployment steady around 6.5%, yet this level remains above historical averages, reflecting that underlying pressures have not dissipated. Entering 2026, new risks are gradually emerging, most notably in trade, financial markets, and employment prospects. Trade uncertainty is expected to remain a significant drag on the Canadian economy. The Canada–United States–Mexico Agreement (CUSMA) will undergo review in July 2026, a process itself likely to dampen corporate investment appetite. While most U.S. industry groups favor retaining the agreement, the current review mechanism grants the U.S. considerable negotiating leverage, making the prospect of smooth continuation until 2036 uncertain. The U.S. has made clear its focus on issues such as Canada's dairy supply management system and the Online Streaming Act, which could become friction points in negotiations. Currently, about 90% of Canadian exports to the U.S. enjoy tariff exemptions under rules of origin; if negotiations deteriorate or the agreement collapses, Canadian exporters could face rising tariffs. This uncertainty may continue to suppress investment and growth expectations until talks conclude. Meanwhile, rapid global expansion of AI investment also poses indirect but inevitable financial risks for Canada. As large tech firms increase spending on AI infrastructure, their debt levels rise significantly, sparking market concerns over potential asset bubbles. If these companies fail to meet return expectations, stock prices and financing conditions could deteriorate quickly. The Bank of Canada has warned that if U.S. markets substantially reprice AI prospects, triggering equity adjustments, negative effects could spill over into Canada via financial and confidence channels. Recent notable pullbacks in some tech stocks from their highs also indicate that excessive optimism toward AI is cooling.

Investors will closely watch the minutes of the Federal Open Market Committee (FOMC) for the latest clues on the monetary policy outlook. At its most recent meeting, the Fed cut rates for the third consecutive time by 25 basis points, lowering the target range to 3.50%–3.75%. The Fed also signaled it will only cut rates once in 2026. Nomura economists noted that although 2025 growth was clearly weighed down by trade and immigration policies, overall resilience remained, and these headwinds are now easing, while fiscal and monetary policy are shifting toward more stimulative stances. At the same time, the U.S. economy still faces multiple risks, including a weakening labor market, persistently high inflation, and internal rifts over policy priorities. In addition, President Trump is set to appoint a new Fed chair to replace Jerome Powell, whose term ends in May. Markets widely expect the new chair to favor pushing for rate cuts. This year, the U.S. job market has gradually cooled, with monthly job additions significantly lower than a year ago and the unemployment rate edging up. These changes prompted Fed policymakers to unanimously support a series of rate cuts toward year-end. November's unemployment rate was 4.6%, but economists note possible distortions due to limited data collection during the government shutdown. Stubbornly high inflation may still constrain room for further cuts. Although Q3 inflation came in well below expectations, economists believe this may underestimate actual price pressures, and it will take months to confirm whether goods inflation driven by tariffs fades as policymakers anticipate. Consumer concern over the labor market is rising. The Conference Board's latest data show consumer sentiment on the job market has deteriorated to its lowest since early 2021. This trend leads some economists to expect households may choose to save rather than spend extra income from tax reforms.

Based on the daily chart, USD/CAD has broken below the EMA200 and is oscillating lower along the EMA12, with MACD and signal lines crossing below the zero axis, indicating entry into a bearish trend. However, a bullish engulfing pattern has emerged, breaking out of the descending channel, suggesting a short-term rebound may occur. MACD is close to forming a golden cross, RSI at 29 signals oversold territory: meaning the downtrend is still valid, but a rebound could happen at any time. In the 4-hour chart, Bollinger Bands are narrowing, moving averages are converging, and downward momentum is gradually weakening. After a golden cross, the MACD and signal lines are retracing toward the zero axis but remain far from it, confirming that the rebound is incomplete. Resistance lies near EMA50 and EMA200 at approximately 1.372 and 1.384, respectively. RSI at 44 reflects prevailing pessimism. Therefore, it is recommended to buy now and sell later.

Trade Direction: Buy

Entry Price: 1.368

Target Price: 1.42

Stop Loss: 1.35

Support: 1.36/1.357/1.35

Resistance: 1.414/1.42/1.44

The Japanese Yen experienced widespread strengthening following the release of the Bank of Japan’s (BoJ) latest monetary policy minutes. The documents revealed a consensus among members that interest rates remain significantly below neutral levels. However, several officials emphasized the necessity of a cautious approach to avoid destabilizing the domestic economy or broader financial markets.

In December, the BoJ successfully hiked its benchmark rate by 25 basis points (bps) to 0.75%, marking a three-decade high. The bank further hinted at additional adjustments throughout 2026 as it continues its normalization process. Despite this hawkish pivot, investor concerns persist regarding Prime Minister Sanae Takaichi’s pro-stimulus stance. Market participants fear such policies could exacerbate an already strained fiscal deficit, as the looming risk of a debt crisis remains a significant headwind for any sustained Yen recovery.

The U.S. Bureau of Economic Analysis reported that the domestic economy expanded at a robust annualized rate of 4.3% in the third quarter. This figure significantly outperformed market expectations of 3.3% and surpassed the previous estimate of 3.8%. Accompanying this strong growth, inflation metrics within the Gross Domestic Product (GDP) report remained firm: the GDP Price Index rose by 3.7%, while Personal Consumption Expenditures (PCE) increased by 2.9%, with core PCE prices climbing 2.8%.

Despite this vigorous growth, the manufacturing sector exhibited signs of cooling. Durable Goods Orders fell by 2.2% in October, reversing a prior gain of 0.7%. Excluding defense, orders dropped by 1.5%, and while orders excluding transportation saw a marginal 0.2% increase, overall Industrial Production slipped by 0.1% month-over-month. In contrast, the housing market showed unexpected strength; data from the National Association of Realtors revealed that Pending Home Sales rose by 3.3% in November, marking their highest level since early 2023.

The Federal Reserve reduced the federal funds rate by 25 basis points (bps) at its December meeting, bringing the target range to 3.50%–3.75%. This marks a cumulative reduction of 75 bps in 2025 as the central bank navigates a cooling labor market and persistent inflation.

According to the CME FedWatch Tool, markets are now pricing in an accelerated easing cycle, with traders anticipating at least two additional cuts by the end of September 2026.

The USD/JPY pair is currently exhibiting a bullish reaction as it approaches a critical technical floor. The 100 and 200-period Moving Averages (MAs) are converging near the 155.80 price level, creating a formidable zone of dynamic support.

This area is increasingly significant as the price action appears to be carving out an Inverse Head and Shoulders pattern. This classic reversal formation, aligning with the broader prevailing trend, suggests that a renewed bullish extension from this support zone is highly probable.

From a momentum perspective, the Relative Strength Index (RSI) recently touched the 39 level. While this is well clear of overbought territory, the indicator is already rebounding from levels just below the neutral mark, signaling that the bullish impulse has substantial room to expand.

The primary upside objective remains the local high of 157.72. The pair has tested this ceiling twice without success; however, current momentum suggests a third attempt may be imminent. Traders should remain vigilant, as a forceful break and close below the 155.80 support zone would effectively invalidate this bullish setup and likely trigger a deeper technical correction.

Trading direction: Buy

Entry price: 156.30

Target price: 157.70

Stop loss: 155.30

Validity: Jan 09, 2025 15:00:00

The U.S. Bureau of Economic Analysis reported that the domestic economy expanded at a robust annualized rate of 4.3% in the third quarter. This figure significantly outperformed market expectations of 3.3% and surpassed the previous estimate of 3.8%. Accompanying this strong growth, inflation metrics within the Gross Domestic Product (GDP) report remained firm: the GDP Price Index rose by 3.7%, while Personal Consumption Expenditures (PCE) increased by 2.9%, with core PCE prices climbing 2.8%.

Despite this vigorous growth, the manufacturing sector exhibited signs of cooling. Durable Goods Orders fell by 2.2% in October, reversing a prior gain of 0.7%. Excluding defense, orders dropped by 1.5%, and while orders excluding transportation saw a marginal 0.2% increase, overall Industrial Production slipped by 0.1% month-over-month. In contrast, the housing market showed unexpected strength; data from the National Association of Realtors revealed that Pending Home Sales rose by 3.3% in November, marking their highest level since early 2023.

The Federal Reserve reduced the federal funds rate by 25 basis points (bps) at its December meeting, bringing the target range to 3.50%–3.75%. This marks a cumulative reduction of 75 bps in 2025 as the central bank navigates a cooling labor market and persistent inflation.

According to the CME FedWatch Tool, markets are now pricing in an accelerated easing cycle, with traders anticipating at least two additional cuts by the end of September 2026.

Across the Atlantic, the European Central Bank (ECB) maintained its key interest rates for the fourth consecutive meeting. The Deposit Facility remains at 2.00%, while the Main Refinancing and Marginal Lending rates are held at 2.15% and 2.40%, respectively. Gediminas Šimkus, Governor of the Bank of Lithuania, noted that risks to both inflation and growth have increasingly tilted to the downside. ECB President Christine Lagarde emphasized a cautious, data-dependent stance, clarifying that neither hikes nor cuts were discussed as the bank monitors global trade uncertainties.

The EUR/USD pair has decisively breached the previous resistance level at 1.1752, a ceiling that had held firm since early October. In a classic technical shift, this level is now acting as support, signaling that the prevailing bullish trend is poised for a new impulse.

The technical outlook is further bolstered by the ascending trendline, which converges precisely with this support-resistance flip zone, adding significant weight to the potential for a bounce.

The 100 and 200-period Moving Averages (MAs) are currently situated at 1.1722 and 1.1654, respectively. Their upward trajectory confirms a dominant bullish momentum. From an oscillator perspective, the Relative Strength Index (RSI) recently touched a local low of 44, dipping just below the neutral zone before recovering quickly.

Currently sitting at 51, the RSI reflects a healthy market structure with ample room for further upside before reaching overbought conditions. Traders should remain alert, however; a forceful break below the ascending trendline would invalidate this setup and likely trigger a deeper correction toward the moving averages, which would then serve as the primary line of defense.

Trading direction: Buy

Entry price: 1.1770

Target price: 1.1890

Stop loss: 1.1700

Validity: Jan 09, 2026 15:00:00

Overview

AUDJPY’s latest downside swing matters because it is not just “random volatility”; it is a repricing of the spread narrative. The RBA cash rate target remains at 3.60% and the next meeting is not until early February, so AUD’s carry appeal is relatively “known” in the near term.

The variable is JPY. After the BOJ’s December move lifting the policy rate to 0.75% (a multi-decade high), the meeting summary showed policymakers actively debating further hikes, which keeps the market sensitive to any hint that Japan’s rate floor is still rising. That shift compresses the “funding currency” logic and makes AUDJPY more vulnerable when liquidity is thin and investors de-risk into year-end.

Rates optics support the story: Japan’s 10Y yield around 2.06% (Dec 29) reinforces the idea that yen assets are no longer anchored near zero in the way they were for years, which changes hedging behavior and the threshold for JPY short-covering.

Today’s AUDJPY behavior looks like “carry caution” rather than a clean risk-on trend. The drop from the 105.22 area to a 104.36–104.49 print (recent session range/close) signals that sellers are willing to defend highs and force late buyers to exit.

What makes that important is positioning math: when a cross has been grinding higher, many entries cluster near breakout levels (around 105.0–105.2). Once price slips back under that zone, the trade stops being a momentum hold and becomes a “protect profit / cut risk” decision.

In year-end conditions, that decision tends to be fast, and the yen often benefits when traders reduce leverage. Meanwhile, the BOJ narrative is not simply “one hike done”; Reuters reporting highlights internal debate about additional hikes every few months, which keeps JPY dips buyable and caps AUDJPY rebounds.

On M15, treat 105.00–105.22 as the “failed expansion” ceiling from the recent spike. The first tell for a sell-bias is whether price remains below the Bollinger mid-band (20 SMA) after any bounce; if rebounds keep stalling at or just under the mid-band, it implies the move is being sold systematically rather than bought for continuation.

With Ichimoku (9,26,52), the practical question is location versus the Kijun-sen and the cloud: after a sharp pullback, the market often retests Kijun (mean reversion) before choosing direction. If M15 closes keep failing to reclaim Kijun and the cloud acts as overhead supply, that is a high-quality “sell-the-retest” structure because it aligns trend (below balance) with risk control (clear invalidation above the recent high zone).

For Stoch (5,3,3), avoid the trap of selling just because it is oversold. The higher-probability entry is when Stoch recovers from oversold toward mid/high levels but price fails to break above the Bollinger mid-band / Ichimoku balance; that divergence (momentum tries to recover, price can’t) is often where the next impulsive leg down starts.

Entry: 104.4

Take Profit: 103.70

Stop Loss: 105.28

Silver has seen a massive year-to-date rally, trading near $72–$75 per ounce on live feeds, within a 52-week range roughly 28.15–75.15, showing extraordinary strength versus historical norms and approaching record levels again. The recent price action in thin end-of-year liquidity revealed a correction from extreme highs (above $79) into a range downtown around $71–$74 as profit-taking emerged and margin cost hikes pressured leveraged players.

On the M15 chart, this consolidation has formed a higher-low base near the lower part of the current intraday range, suggesting that sellers have not converted pullbacks into new shorts and buyers are stepping in earlier a hallmark of short-term demand dominance.

Despite a sudden pullback seen in thin holiday liquidity where silver dropped sharply on margin and risk events sentiment retains structural bullish bias as traders revisit metal exposure for both industrial and safe-haven purposes.

Short-term sentiment is cautious but optimistic: declines are treated as consolidation rather than reversal signals, and broad macro forecasts still anticipate upward pressure if support holds and demand (industrial + speculative) resumes. Technical forecasters note that price movement above key moving averages and positive momentum indicators support continuation rather than deep reversal.

On M15, silver is holding above or near the mid-band after the latest pullback. This is a key early bullish signal buyers showing strength at or above the 20-period average typically set the stage for moves back toward or above the upper band. If price sustains above the mid-band with contracted volatility, it suggests accumulation and traction for a rebound to resistance zones.

Ichimoku (9,26,52): The price action oscillates around the cloud but remains relatively above it after corrective dips, indicating that immediate downtrend pressure is not dominant. When price holds above or near the cloud and Tenkan Sen re-crosses above Kijun Sen after a pullback, it reinforces short-term bullish momentum.

Stoch (5,3,3): Stochastic readings on M15 reflect that recent pullbacks took silver toward neutral/oversold territory, and subsequent upward cross signals indicate an early return of positive momentum. This pattern often precedes short-term continuation in strong uptrends especially if buyers prevent lower lows from forming on the chart.

Entry: Initiate BUY near $71.80–$73.00

Take Profit: TP1 $75.20–$75.60

Stop Loss: SL below $70.8

Live price data places BTCUSDT near $87,500–$88,400 USDT, with the 24-hour trading range concentrated between $86,800 (low) and $90,400 (high) a clear sign of range compression amid holiday season thin liquidity.

The market has been oscillating around this zone, where sellers have repeatedly failed to sustain a decisive breakdown, suggesting the range low holds as a short-term value anchor. Importantly, recent reports indicate that large institutional holders like Strategy are buying significant amounts of Bitcoin again around 1,129 BTC at ~$88,568 each representing nearly $109 million in fresh inflows after a brief dry spell, which underscores strong corporate demand near current price levels.

Short-term sentiment in Bitcoin markets is nuanced: ETF products have seen notable outflows during Christmas week, with total net spot Bitcoin ETF outflows around $782 million, illustrating holiday positioning and profit taking pressures.

However, this does not necessarily imply a fundamental bearish turn rather, it reflects calendar-driven adjustments where institutional players reduce positions as desks close for the season, with expectations that flows could stabilize once markets reopen.

Additionally, broad risk sentiment has shown intermittent resilience with sporadic rebounds above key round numbers, hinting at latent buyer interest rather than outright capitulation. This blend of thin liquidity pressures and underlying demand sets up asymmetric risk where dips near support attract tactical accumulation on short timeframes.

On the M15 timeframe, Bollinger Bands (20,2) illustrate a compressing structure with price oscillating near the mid-band not trending but coiling. This often precedes directional resolution; a reclaim above the mid-band with expanding upper band activity would favor upside continuation. Sustained support above the lower band at $86,800–$87,000 will be key for validating the long bias.

Ichimoku (9,26,52) on M15 typically shows price interacting with the cloud during consolidation. A close above the cloud and a Tenkan/Kijun bullish alignment signals building upside pressure. If the cloud transitions from resistance to support, it enhances the bullish edge on dips.Stoch (5,3,3) oscillators are valuable here: a fresh bullish crossover from near the lower region especially with price holding value support often precedes short-term rallies on compressed charts. The best long entries occur when Stoch turns upward while price respects structure rather than anticipating breakouts prematurely.

Entry: Consider BUY around $87,000–$87,300

Take Profit: $90,200

Stop Loss: SL below $86,650