USD/CAD Price Analysis – Jan 28, 2025
Daily Price Outlook
During the European trading session, the USD/CAD currency pair maintained its upward trend, staying well-supported around the 1.4410 level and reaching an intraday high of 1.4416. The key driver behind this bullish movement is the US Dollar's recovery from its lowest point since December 18.
The US Dollar found strength due to renewed concerns over inflation, sparked by fears that former President Donald Trump's protectionist policies could reignite inflationary pressures. These worries have led to an increase in US Treasury bond yields, further boosting demand for the US Dollar.
Despite the positive momentum, the USD/CAD pair remains within a familiar trading range that has been in place for about a month.
Traders are cautious ahead of key central bank events later this week, which are likely to influence market sentiment and drive further price movements. As a result, investors are waiting on the sidelines for clearer signals from upcoming central bank decisions.
Impact of Central Bank Policy Divergence and Crude Oil Price Recovery on USD/CAD Pair
On the BoC front, the Bank of Canada (BoC) is set to announce its policy decision on Wednesday, with expectations pointing to a 25 basis point interest rate cut.
This move contrasts with the broader market view that the US Federal Reserve (Fed) will keep interest rates steady after their two-day meeting on the same day.
This difference in monetary policy is seen as a major factor supporting the USD/CAD pair, as traders expect the US Dollar to benefit from a more hawkish stance compared to the BoC's dovish approach.
However, a slight recovery in Crude Oil prices, which had dropped to a near three-week low on Monday, is helping to limit losses for the Canadian Dollar (Loonie), a currency often influenced by oil price movements. This recovery in oil prices is capping the upside potential for the USD/CAD pair.
Traders are now focusing on the US economic data, including Durable Goods Orders, the Conference Board's Consumer Confidence Index, and the Richmond Manufacturing Index, hoping for fresh direction as they anticipate these reports later in the US session. These factors will likely influence the pair's movement going forward.
Therefore, the Bank of Canada's expected interest rate cut, along with the US Federal Reserve's steady stance, supports the USD/CAD pair by strengthening the US Dollar. However, the recovery in Crude Oil prices helps limit the upside potential for the pair.
USD/CAD – Technical Analysis
USD/CAD is trading at $1.43954, up 0.15%, as the pair maintains a bullish bias supported by positive momentum. The pivot point at $1.44158 acts as a critical threshold, with a break above this level paving the way for further gains.
Immediate resistance is positioned at $1.44576, followed by key levels at $1.45185 and $1.45757, suggesting strong upward potential if the pair clears these barriers.
On the downside, support is seen at $1.43340, with additional buffers at $1.42694 and $1.42101, which could come into play if selling pressure intensifies.
The pair is trading above the 50-EMA at $1.43679, which reinforces the short-term bullish outlook. However, any failure to sustain gains above the pivot may lead to consolidation or correction.
The trade setup suggests a Buy Stop at $1.44266, targeting $1.44846, with a stop loss at $1.43855 to mitigate downside risk.
Traders should monitor developments in oil prices, a key driver for the Canadian dollar, and upcoming economic data for directional cues.
Related News
- GOLD Price Analysis – Jan 28, 2025
AUD/USD Price Analysis – Jan 28, 2025
Daily Price Outlook
During the European trading session, the AUD/USD currency pair has been flashing red and remains under pressure around the 0.6247 level, hitting an intra-day low of 0.6243.
However, the decline in the pair was mainly due to the tariff threats made by US President Donald Trump. As a result, the risk-sensitive AUD has been negatively impacted by increased market uncertainty, as traders react to growing concerns about potential tariffs.
Moreover, President Trump announced plans to impose 25% tariffs on imports from Mexico and Canada, with the aim of boosting US manufacturing.
Additionally, he revealed intentions to place tariffs on computer chips, pharmaceuticals, steel, aluminum, and copper. These actions have fueled risk aversion in the markets, contributing to the AUD/USD pair’s downward pressure.
US Dollar Strengthens Amid Trade Policy Uncertainty, Weighing on AUD/USD
On the US front, the broad-based US Dollar has been trading near 108.00 on the US Dollar Index (DXY), which tracks its value against six major currencies.
Traders are closely watching key economic data, including US Durable Goods Orders, Consumer Confidence, and the Richmond Fed Manufacturing Index, set to be released later on Tuesday.
These reports could affect market sentiment and the strength of the USD, which has been gaining due to uncertainty surrounding President Donald Trump’s trade policies. The US Dollar’s strength is keeping the AUD/USD pair under pressure.
Former Treasury Secretary Scott Bessent has proposed new tariffs on US imports, starting at 2.5%, with the possibility of these tariffs increasing to 20%.
Trump has also indicated that he wants tariffs "much bigger" than the 2.5% figure. This uncertainty about trade policies is causing risk aversion in the markets, which is benefiting the US Dollar and weighing on the Australian Dollar (AUD).
Despite Trump’s calls for immediate interest rate cuts, traders expect the Federal Reserve to hold interest rates steady at the 4.25%-4.50% range in its January meeting.
The uncertainty around trade policies, combined with mixed US economic data such as a drop in Services PMI and a rise in Manufacturing PMI, could keep inflationary pressures in check. This cautious sentiment is strengthening the USD, which continues to impact the AUD/USD pair negatively.
China's Economic Struggles Weigh on the Australian Dollar, Further Pressuring AUD/USD
On the other hand, the losses in the AUD/USD pair could be further worsened by the limited support from China’s fresh stimulus measures.
Despite efforts to boost its equity market, including a second round of long-term stock investment programs worth 52 billion Yuan ($7.25 billion), the Australian Dollar failed to benefit.
These measures were aimed at reviving the struggling Chinese economy, but they did not provide enough support to the AUD.
China’s economic troubles continue to weigh on the Australian Dollar. In 2024, China’s Industrial Profits dropped by 3.3% year-over-year, marking the third consecutive year of decline.
The continued contraction is mainly due to weak demand, deflationary pressures, and a long slump in the property sector. These ongoing challenges in China, a key trading partner for Australia, make it difficult for the AUD to gain strength.
As a result, the Australian Dollar remains under pressure, especially with the ongoing economic struggles in China and the lack of strong support from the stimulus measures.
AUD/USD – Technical Analysis
The Australian dollar (AUD/USD) is trading at $0.62517, down 0.63%, as selling pressure continues to dominate. The pair remains below the critical pivot point at $0.62640, suggesting a bearish outlook in the short term.
Immediate support lies at $0.62213, with further downside potential toward $0.61899 and $0.61648 if bearish momentum accelerates.
Resistance on the upside is capped at $0.62998, followed by $0.63302 and $0.63620. For bullish sentiment to regain traction, a decisive break above the pivot and the 50-EMA at $0.62848 is necessary.
However, the broader trend appears bearish, with the 50-EMA reinforcing downside pressure as it acts as a dynamic resistance.
The technical setup suggests continued weakness, particularly as the pair struggles to reclaim the pivot point at $0.62640. Traders are eyeing $0.62213 as a key level; a confirmed break below this support could invite further selling, targeting $0.61899.
Conversely, a bounce above the pivot could see the pair testing resistance levels, contingent on market sentiment and upcoming economic catalysts.
Traders should remain cautious, as the downward trajectory aligns with ongoing concerns over commodity-linked currencies amid fluctuating global risk sentiment.
A break below $0.62636 could confirm bearish continuation, while failure to sustain losses below key supports may lead to temporary relief.
Related News
- GOLD Price Analysis – Jan 28, 2025
GOLD Price Analysis – Jan 28, 2025
Daily Price Outlook
Gold price (XAU/USD) struggled to stop its bearish trend and turned bullish around the 2,744 level, reaching an intra-day high of 2,745.
However, the rise in demand for the dollar was mainly caused by renewed inflation worries due to US President Donald Trump's trade tariff threats.
These concerns led to a slight recovery in US Treasury bond yields, which helped the USD rise from its lowest point since December 18.
Despite this, gold losses may be limited because many expect the Federal Reserve to cut interest rates twice by the end of the year.
Trump's comments about pushing for immediate rate cuts also support this idea, which could prevent US bond yields and the dollar from rising too much.
US Dollar Strengthens Amid Trade Uncertainty and Mixed Economic Data
On the US front, the broad-based US dollar has been trading near the 108.00 mark, as tracked by the US Dollar Index (DXY), which measures the dollar's strength against six major currencies.
Traders are closely watching key economic reports like the US Durable Goods Orders, Consumer Confidence, and the Richmond Fed Manufacturing Index, which could influence market sentiment.
The US dollar has been gaining strength amid uncertainty surrounding President Donald Trump’s trade and immigration policies.
Meanwhile, recent US economic data showed mixed signals. The S&P Global Composite PMI dropped to 52.4 in January, while the Manufacturing PMI rose slightly to 50.1.
Trump, however, has expressed his desire for the Fed to cut interest rates immediately, especially with falling oil prices.
This could pressure inflation and limit the Fed's ability to make aggressive rate cuts, especially as the January meeting approaches. Traders expect the Fed to hold rates steady in the 4.25%-4.50% range.
Therefore, the US dollar's strength and mixed economic data may put pressure on gold prices, as a stronger dollar typically makes gold more expensive. However, expectations for the Federal Reserve to keep rates steady could limit further downside for gold.
China's Economic Slowdown Sparks Global Uncertainty, Supporting Gold's Safe-Haven Appeal
On the China front, China's NBS Manufacturing PMI dropped to 49.1 in January, down from 50.1 in December, falling short of expectations.
This signals a contraction in manufacturing activity, as a reading below 50 indicates a decline. Similarly, the NBS Non-Manufacturing PMI also fell to 50.2 in January from 52.2 in December, showing weaker growth in services and construction.
Moreover, China’s Industrial Profits saw a decline of 3.3% year-over-year in 2024, totaling CNY 7,431.05 billion.
Although this decline was slightly smaller than the 4.7% drop in the first 11 months of 2023, it marks the third consecutive year of falling profits.
This ongoing downturn reflects weaker demand, rising deflationary pressures, and struggles within China’s property sector.
These weak economic indicators from China contribute to global market uncertainty. As one of the world's largest economies, China’s slowdown can have a ripple effect on other markets, including commodities like gold.
A weaker Chinese economy may increase demand for gold as a safe-haven asset, potentially supporting its price.
GOLD (XAU/USD) – Technical Analysis
Gold prices are hovering at $2,740.99, posting a marginal gain of 0.02% as investors weigh market sentiment ahead of key economic events.
The pivot point at $2,745.39 remains a critical inflection zone; a sustained move below this level could signal further downside pressure.
Immediate support stands at $2,721.21, with extended declines targeting $2,706.09 and $2,689.39 if bearish momentum intensifies.
On the upside, immediate resistance is positioned at $2,763.67, with additional barriers at $2,786.25 and $2,804.06. A bullish breakout above these levels could reignite upside momentum, challenging recent highs.
However, gold remains vulnerable to short-term volatility, particularly amid fluctuating bond yields and shifting market sentiment.
From a technical perspective, the 50-EMA at $2,756.89 currently acts as a dynamic resistance, reinforcing selling pressure near the pivot.
Failure to break above this level suggests that gold remains bearish in the near term, aligning with the broader corrective trend.
Traders should watch for a decisive break below $2,745 to confirm continued selling momentum, with $2,720 as a near-term target.
Conversely, a strong bounce from current levels could set the stage for a potential reversal, contingent on economic catalysts and broader risk sentiment.
Related News
- AUD/USD Price Analysis – Jan 28, 2025
GBP/USD Price Analysis – Jan 27, 2025
Daily Price Outlook
During the European trading session, the GBP/USD pair maintained its upward momentum, staying well-supported around the 1.2502 level and reaching an intraday high of 1.2508.
Despite growing concerns about stagflation risks in the UK economy, the British Pound showed resilience.
However, the Pound managed to recover its losses and climb back toward the 1.2500 mark against the US Dollar.
This recovery came as the US Dollar weakened following news that investors were digesting fears of potential 25% tariffs on Columbia imposed by former US President Donald Trump. This combination of factors helped support the GBP/USD pair during the European session.
US Dollar Weakens Amid Tariff Threats and Fed's Upcoming Decision, Boosting GBP/USD
On the US front, the broad-based US Dollar (USD) retreated, helping the GBP/USD pair recover its losses and climb back to near the 1.2500 level.
The Greenback weakened after investors digested news that former President Donald Trump had threatened to impose 25% tariffs on Columbia.
Trump made this threat over Columbia’s refusal to allow military flights carrying illegal immigrants, but he later decided to pause the tariffs after Columbia agreed to his terms.
As a result, the US Dollar fell back to around 107.50 from an intraday high of 107.80. This drop showed that investors no longer saw the Greenback as a safe haven, as they expected Trump’s tariffs to be used primarily as negotiation tactics.
ING analysts noted that there’s growing sentiment that Trump might not follow through on many of his protectionist threats, especially if concessions are made on trade.
Looking ahead, the main factor for the US Dollar this week will be the Federal Reserve’s (Fed) monetary policy decision, set to be announced on Wednesday. The Fed is likely to keep interest rates unchanged in the range of 4.25%-4.50%.
GBP Rises Amid Concerns of Stagflation and Growing Economic Weakness in the UK
On the GBP front, the British Pound is rising despite concerns over the growing risks of stagflation in the UK economy.
On the data front, the latest S&P Global UK Purchasing Managers Index (PMI) report for January showed that employment dropped for the fourth consecutive month, and cost pressures in the private sector are increasing.
This situation is likely to lead to higher inflation as businesses pass on rising input costs to customers.
Meanwhile, the slowdown in labor demand is partly due to the announcement from Chancellor of the Exchequer Rachel Reeves, who revealed plans to increase employers’ contributions to National Insurance.
As a result, businesses are cutting back on hiring, facing falling sales, and dealing with uncertainty about the future.
These signs of economic weakness are adding to worries about stagflation, with inflationary pressures returning. Chris Williamson, Chief Business Economist at S&P Global, noted that business conditions in 2025 are not looking promising.
Therefore, the UK’s worsening job market and rising inflation pressures are expected to make things more challenging for the Bank of England (BoE), which will announce its monetary policy decision on February 6.
Many traders are betting on a 25 basis point (bps) rate cut to 4.5%, which is affecting yields on UK 30-year gilts, causing them to drop by over 1% to around 5.15%.
GBP/USD – Technical Analysis
The GBP/USD pair is facing downward pressure, currently trading at $1.24427, reflecting a 0.29% decline in today’s session. The pair struggles to maintain momentum above the key pivot level of $1.24065, which serves as a crucial support zone.
A sustained break below this level could expose the currency pair to further downside risks, with immediate support at $1.23440, followed by deeper levels at $1.22921 and $1.22280.
On the upside, immediate resistance is seen at $1.25064, and a decisive breakout above this level could pave the way for further gains toward $1.25637 and $1.26131.
However, market sentiment remains cautious as traders weigh economic data releases from both the UK and the US, including inflation figures and central bank guidance, which may influence the pair’s trajectory.
The 50-day EMA, currently positioned at $1.23536, offers dynamic support and could serve as a critical inflection point for traders assessing the broader trend. If GBP/USD remains below the pivot level, selling pressure is likely to persist.
A bearish breakdown below $1.24065 could confirm further downside momentum, whereas a move above $1.24501 may indicate a potential bullish reversal.
Related News
- GOLD Price Analysis – Jan 27, 2025
EUR/USD Price Analysis – Jan 27, 2025
Daily Price Outlook
During the European trading session, the EUR/USD currency pair has been making a strong rebound, moving back towards the 1.0510 level. The pair is on track to break above its six-week high of 1.0520.
This recovery comes after the US Dollar gave up its earlier intraday gains, which had been fueled by concerns over potential tariffs on Colombia proposed by former President Donald Trump.
At the same time, the Euro (EUR) is gaining momentum as markets await the European Central Bank’s (ECB) upcoming monetary policy decision.
The ECB is widely expected to lower its Deposit Facility rate by 25 basis points, bringing it down to 2.75%.
Additionally, the Main Refinancing Operations Rate is likely to decrease to 2.9%. This would mark the fourth consecutive interest rate cut by the ECB.
EUR/USD Strengthens Ahead of ECB Rate Cut Expectations and Economic Data
On the EUR front, the shared currency has been strengthening as the US Dollar weakens. This move is largely driven by a shift in market sentiment, with traders anticipating a rate cut from the European Central Bank (ECB).
The ECB is expected to lower its Deposit Facility rate by 25 basis points, bringing it to 2.75%. This would be the fourth consecutive rate cut by the central bank.
As a result, the Euro is edging higher ahead of the ECB's monetary policy decision, with markets looking for fresh guidance from ECB President Christine Lagarde on how the bank plans to handle economic challenges, including the potential impact of former President Trump’s tariffs on the Eurozone.
Traders are confident that the ECB will continue to cut rates, especially given the Eurozone's inflation is under control and growth prospects remain sluggish.
Investors are also expecting three more rate cuts this year during the ECB's meetings in the first half. The upcoming press conference by Lagarde will be crucial for any hints on future monetary policies and the ECB’s response to external pressures.
On the economic front, data from Germany is showing mixed signals. The German IFO Business Climate Index rose slightly to 85.1 in January, beating expectations. However, the IFO Expectations Index, which gauges future sentiment, slowed more than expected.
This week, investors will also be focusing on the Eurozone’s preliminary Q4 GDP data, expected to show a 1% growth year-over-year, which is an improvement from the previous quarter's 0.9% growth.
US Dollar Weakens as Tariff Concerns Ease, Investors Eye Fed and ECB Rate Decisions
On the US front, the broad-based US dollar has reversed its earlier gains as concerns about tariffs on Colombia by former President Donald Trump eased. Trump had proposed a 25% tariff on Colombia after the country refused to accept military flights carrying deported immigrants from the US.
However, the situation shifted when the Colombian government agreed to Trump's terms, putting the proposed tariffs "on hold." As a result, the US Dollar Index (DXY), which tracks the Greenback against six major currencies, slid to around 107.00, driving the EUR/USD pair higher.
Market sentiment remains cautious, with investors awaiting important interest rate decisions from the Federal Reserve (Fed) and the European Central Bank (ECB) this week. The Fed is expected to keep interest rates unchanged within the 4.25%-4.50% range, according to the CME FedWatch tool.
Investors will be closely watching Fed Chair Jerome Powell's press conference for any hints about the central bank's stance, particularly in response to Trump's calls for immediate rate cuts.
On the US economic front, key data releases this week include Durable Goods Orders, the Personal Consumer Expenditure Price Index (PCE) for December, and preliminary Q4 Gross Domestic Product (GDP) data.
These reports will provide further insights into the strength of the US economy and could influence market expectations around future Fed policy.
The easing of tariff concerns between the US and Colombia has led to a weaker US Dollar, causing the EUR/USD pair to rise. Investor focus on upcoming interest rate decisions from the Fed and ECB adds further uncertainty to the pair's movement.
EUR/USD – Technical Analysis
The EUR/USD pair is experiencing downward pressure, currently trading at $1.04591, marking a 0.32% decline for the session. The pair has struggled to hold above the pivot point at $1.04471, which serves as a key level for directional bias.
A sustained move above this level could trigger renewed bullish momentum, with immediate resistance standing at $1.04971. Further upside potential is seen at $1.05329 and $1.05682 if bullish sentiment persists.
On the downside, the pair faces immediate support at $1.03971, with additional cushions at $1.03515 and $1.03012. A break below these levels could intensify selling pressure, pushing EUR/USD into a deeper correction phase.
The broader market sentiment remains cautious as investors await key economic data from the Eurozone and the U.S., particularly inflation reports and central bank commentary, which could drive volatility in the pair.
Technical indicators suggest a neutral to bullish outlook, with the 50-day EMA positioned at $1.04269, providing dynamic support.
If the pair maintains strength above this moving average, it could signal further buying interest. However, failure to sustain above $1.04470 might invite sellers back into the market.
Related News
- GOLD Price Analysis – Jan 27, 2025
GOLD Price Analysis – Jan 27, 2025
Daily Price Outlook
Gold (XAU/USD) is under pressure as it trades near $2,750, down 0.65% in the European session on Monday. The drop is mainly due to the US Dollar (USD) recovering from its recent low, which weakens gold’s appeal.
Meanwhile, US President Donald Trump's announcement of tariffs on all Colombian imports has sparked fresh trade war worries, reducing investor interest in riskier assets.
At the same time, growing concerns about the global economy have driven demand for safe-haven assets.
The Federal Reserve’s potential plan to cut interest rates twice this year is also weighing on US Treasury bond yields. This could limit the USD's gains, providing some support for gold prices despite the decline.
US Dollar Strengthens Amid Economic Data and Trade Uncertainty, Pressuring Gold Prices
On the US front, the broad-based US dollar has been gaining traction after rebounding from a monthly low of 107.22. This rise in the dollar comes amid uncertainty surrounding US President Donald Trump’s trade and immigration policies.
The situation may influence the Federal Reserve (Fed) to adopt a cautious approach regarding interest rate cuts, which has kept pressure on gold prices.
On the data front, the latest data from S&P Global shows a mixed picture for the US economy. The US Composite PMI dropped to 52.4 in January from 55.4 in December, while the Manufacturing PMI rose slightly to 50.1, exceeding expectations.
However, the Services PMI fell to 52.8, missing the forecast and showing weaker growth in the services sector. Despite these figures, Trump’s comments at the World Economic Forum in Davos, calling for immediate interest rate cuts, have added uncertainty to the market.
On Sunday, he announced a 25% emergency tariff on all Colombian goods, which raised tensions. However, by Monday, Colombia agreed to the terms, resolving the issue.
Despite this, gold prices remain under pressure due to a stronger US dollar and the possibility of Federal Reserve rate cuts, making it harder for gold to gain momentum.
China's Economic Struggles and Market Measures Could Boost Gold Demand as Safe-Haven Asset
On the other hand, Chinese authorities are taking steps to stabilize their stock markets by introducing measures to boost investments.
Pension funds have been allowed to increase investments in domestic equities, and a pilot scheme for insurers to purchase equities is set to launch in early 2025 with a scale of at least 100 billion Yuan.
The People’s Bank of China (PBoC) has also announced plans to expand liquidity tools to support share purchases, aiming to restore confidence in the market.
Despite these efforts, economic data from China highlights ongoing challenges. Industrial profits fell by 3.3% year-over-year in 2024, marking the third consecutive year of contraction.
Hence, the weak demand, deflationary pressures, and a prolonged slump in the property sector continue to weigh on China’s economic performance, further denting investor sentiment. This has fueled concerns about China’s growth outlook, which could indirectly support gold demand as a safe-haven asset.
On the data front, the latest PMI data reflects weaker activity in China. The Manufacturing PMI dropped to 49.1 in January, falling below the key 50 level, indicating contraction.
Similarly, the Non-Manufacturing PMI fell to 50.2, signaling slower growth in the services sector. These economic concerns in the world’s second-largest economy may bolster safe-haven flows into gold, offsetting some pressure from a stronger US dollar.
GOLD (XAU/USD) – Technical Analysis
Gold (XAU/USD) is experiencing downward pressure, currently trading at $2,755.43, down 0.56% in today’s session. The precious metal remains below key resistance levels, with bearish sentiment prevailing as investors eye the Federal Reserve’s upcoming policy decision.
Gold prices are testing the immediate support level of $2,753.77, aligning with the 50-day EMA at $2,753.96. A break below this level could accelerate selling pressure, potentially driving prices toward the next support at $2,735.77, followed by $2,718.32.
On the upside, immediate resistance stands at $2,782.81, which aligns with recent swing highs. A sustained breakout above this level could trigger further buying momentum, targeting the next resistance zones at $2,797.37 and $2,813.75.
However, market sentiment remains cautious, with investors focusing on inflation data and the Fed’s interest rate outlook, which may influence gold’s short-term trajectory.
The 50-day EMA is providing dynamic support, but a break below could suggest a shift in market sentiment, leading to further downside risks.
If gold maintains support above $2,750, it could present a buying opportunity with a target towards $2,782. Conversely, failure to hold above this level may reinforce bearish momentum.
Related News
- GBP/USD Price Analysis – Jan 27, 2025
GOLD Price Analysis – Jan 24, 2025
Daily Price Outlook
Gold (XAU/USD) continued its upward momentum on Friday, trading near the $2,774 level and reaching an intraday high of $2,777 during the European session. This bullish run can be traced to several key factors influencing market sentiment.
However, the major driver was the weakening US Dollar (USD), triggered by comments from US President Donald Trump, who signaled a preference for avoiding tariffs on China. His remarks led to a drop in US Treasury bond yields, which in turn pushed the USD to a fresh monthly low.
Moreover, speculation about further monetary easing by the Federal Reserve (Fed) has been heating up. Investors anticipate that lower interest rates will continue to weaken the USD, enhancing gold’s role as an attractive alternative investment.
Impact of Trump's Comments on US Dollar and Federal Reserve's Upcoming Decisions
On the US front, the broad-based US Dollar has been losing traction but still it is holding above the 108.00 level. This suggests the dollar is performing well compared to other currencies.
Former President Donald Trump recently spoke at the World Economic Forum in Davos, Switzerland, calling for the US Federal Reserve (Fed) to lower interest rates immediately. He argued that with oil prices dropping, the Fed should cut rates to support the economy.
His remarks came ahead of the Fed's scheduled meeting on January 28 and 29, where traders expect the central bank to keep interest rates steady in the range of 4.25%-4.50%.
Trump’s comments could put pressure on the US dollar as they come just before the Fed’s meeting, with market expectations for the central bank to hold rates steady.
Moreover, Trump's policies might increase inflation, which could limit the Fed's ability to cut rates further. This situation creates uncertainty, and traders are closely watching the Fed's actions and any potential impact on inflation and the US dollar.
China's Stock Market Stabilization Efforts and Their Potential Impact on Gold Prices
On the other hand, Chinese authorities are taking steps to stabilize their stock markets, which could have an impact on global gold prices.
On Thursday, they announced measures such as allowing pension funds to invest more in domestic stocks and introducing a pilot scheme for insurers to buy equities in 2025, with an initial investment of at least 100 billion Yuan. These actions aim to support the stock market by boosting investments.
Apart from this, the People’s Bank of China (PBoC) stated that it would increase liquidity tools to help fund share purchases when needed. This could lead to more liquidity in the market, potentially reducing the demand for Gold as a safe-haven asset.
If these measures help stabilize China's markets, it could lower some of the risk appetite in global markets, influencing Gold prices to move lower as investors shift towards equities and other riskier assets.
GOLD (XAU/USD) – Technical Analysis
Gold prices are trading at $2,774.26, reflecting a 0.70% increase, as the precious metal gains momentum above key technical levels.
The price remains above the pivot point at $2,763.20, signaling bullish strength, with immediate resistance at $2,785.22. A break above this level could pave the way for further upside toward $2,796.49 and potentially $2,807.41.
On the downside, immediate support is positioned at $2,748.23, followed by deeper levels at $2,736.39 and $2,722.33.
The 50-day Exponential Moving Average (EMA) at $2,738.54 acts as a crucial support zone, reinforcing the broader bullish outlook. Holding above this level suggests sustained buying interest, keeping the uptrend intact.
The recent price action indicates strong bullish sentiment, with buyers showing resilience at key support levels. A decisive break above the resistance at $2,785.22 could attract further buying, targeting higher resistance zones.
However, failure to sustain above the pivot level of $2,763.20 may trigger a corrective move, testing immediate support.
From a technical perspective, the market structure remains favorable for bulls as long as the price holds above the pivot.
Related News
- EUR/USD Price Analysis – Jan 24, 2025
S&P500 (SPX) Price Analysis – Jan 24, 2025
Daily Price Outlook
The global market sentiment has been flashing red, as witnessed by the bearish performance of the S&P 500 index, which is trading at the 6,118 level, hitting the intra-day low of 6,074.
However, the reason for its downward trend can be attributed to several factors, including concerns over inflation, uncertain global trade relations, and the anticipated decisions from the US Federal Reserve.
Apart from this, geopolitical tensions, particularly in the Middle East, and concerns over global trade disruptions have dampened investor confidence.
As a result, the S&P 500 has been facing significant headwinds, with fears of an economic slowdown weighing heavily on investor sentiment.
US Dollar, Fed Rate Cut, and US Tariff News Impact on the S&P 500
One of the key factor impacting the performance of the S&P 500 is the uncertainty surrounding US monetary policy. Recently, the US Dollar Index (DXY) dropped, reflecting growing expectations that the Federal Reserve will cut interest rates.
President Donald Trump has been vocal about pushing the Fed to lower borrowing costs, even suggesting that rates should be cut immediately.
The US dollar's weakness has been partly fueled by these calls for rate cuts and by President Trump's comments about trade tariffs with China.
As a result, market participants are closely monitoring these developments, as rate cuts could support the economy by making borrowing cheaper, thus potentially benefiting corporate earnings in the long run.
However, concerns also linger that rate cuts could signal economic weakness, which could further weigh on stock prices, including the S&P 500.
The tariff uncertainty, along with President Trump's recent statements about trade with China, further adds to the market's cautious outlook, increasing volatility and contributing to the bearish trend in the S&P 500.
China PBOC Maintains Interest Rate and Injects Liquidity, Impact on the S&P 500
Another important factor influencing the S&P 500 index is the policy response from China. The People's Bank of China (PBOC) recently maintained the interest rate at 2.00% and injected 200 billion Yuan ($27.46 billion) into the financial system through a one-year medium-term lending facility (MLF).
This move is aimed at stabilizing China’s financial markets and providing liquidity to support economic growth.
Given that China is a major player in the global economy, any measures taken by the PBOC have a effect on global markets, including the S&P 500.
The liquidity injection helps reduce the pressure on Chinese banks and supports local businesses, indirectly fostering a more stable global economic environment.
S&P 500 – Technical Analysis
The S&P 500 (SPX) is trading at 6118.72, marking a 0.53% increase as the index sustains its bullish momentum above the key pivot level of 6118.72.
The immediate resistance is at 6165.39, with further upside targets at 6219.20 and 6267.23. A decisive break above these levels could reinforce the bullish outlook and attract additional buying interest, potentially pushing the index toward fresh highs.
On the downside, immediate support is observed at 6043.67, followed by deeper levels at 5979.98 and 5922.19. The 50-day Exponential Moving Average (EMA) stands at 5953.68, providing dynamic support and indicating a continuation of the broader uptrend.
Maintaining above this level signals strength, while a break below could introduce selling pressure, bringing the index toward lower support zones.
From a technical standpoint, the index remains within an ascending trend, with buying interest prevailing above the pivot point.
However, traders should monitor market sentiment and macroeconomic factors, which could influence volatility and direction.
A breakout above 6165.39 may accelerate bullish momentum, while failure to sustain above the pivot could see the index retreat toward key support levels.
Related News
- GOLD Price Analysis – Jan 24, 2025
EUR/USD Price Analysis – Jan 24, 2025
Daily Price Outlook
During the European trading session, the EUR/USD currency pair continued its upward trend, reaching an intra-day high of 1.0515.
This bullish rally was driven by positive economic data from the Eurozone. Another factor supporting the EUR/USD rally is the decline in the US Dollar’s (USD) strength.
Moving ahead, the key focus for the EUR/USD pair will be the Federal Reserve’s policy decision on Wednesday, with rates expected to stay at 4.25%-4.50%.
Investors will also pay close attention to Fed Chair Jerome Powell’s comments for policy clues. Meanwhile, January’s US S&P Global PMI data at 14:45 GMT could affect EUR/USD sentiment.
Euro Gains Momentum on Strong PMI Data but Faces Dovish ECB Outlook
The shared currency has gained strength after encouraging economic data from the Eurozone. On the data front, the Hamburg Commercial Bank (HCOB) reported that the preliminary Composite Purchasing Managers Index (PMI), compiled by S&P Global, improved in January, rising to 50.2 from 49.6 in November.
This marks a return to growth after two months of contraction. Economists had expected the PMI to decline slightly to 49.7, but the better-than-expected data suggests cautious optimism for the region’s economy.
The report showed strong demand for labor and new business growth in the services sector, though the manufacturing sector still faces issues like layoffs and declining orders. Dr. Cyrus de la Rubia, Chief Economist at HCOB, said the start of the year is "mildly encouraging," with cautious growth in the private sector.
Although the positive PMI has helped the Euro in the short term, its overall outlook remains uncertain. The European Central Bank (ECB) is expected to lower its Deposit Facility rate by 25 basis points to 2.75% in its upcoming meeting. As inflation is expected to ease, the ECB may continue its cautious approach, limiting the Euro's long-term growth.
US Dollar Weakens Amid Trade Deal Hopes and Fed Policy Anticipation
On the US front, the broad-based US Dollar has weakened amid increasing bets of rate cuts. The US Dollar Index (DXY), which tracks the Dollar’s value against six major currencies, fell 0.6% on Friday, hitting a fresh five-week low near 107.45.
This decline followed remarks from former President Donald Trump, who suggested he could reach a trade deal with China without imposing heavy tariffs.
During his election campaign, Trump had threatened to impose 60% tariffs on China and 25% on other North American economies, which supported the Dollar's earlier strength.
However, his recent comments about a potential deal have reduced market fears of aggressive trade measures.
Trump’s statement at the World Economic Forum (WEF) in Davos, where he endorsed immediate interest rate cuts, further pressured the Dollar.
His remarks, along with easing trade tension expectations, shifted market sentiment and weighed on the Greenback.
Looking ahead, the Federal Reserve’s upcoming monetary policy decision on Wednesday will be a key event for the US Dollar.
While the Fed is expected to keep interest rates steady at 4.25%-4.50%, Fed Chair Jerome Powell’s statements will be closely analyzed for alignment with Trump’s views.
EUR/USD – Technical Analysis
EUR/USD is trading at $1.04517, up 0.35%, as the pair continues to exhibit a bullish bias above the pivot point of $1.04324.
The currency pair is facing immediate resistance at $1.04971, with the next key levels to watch at $1.05329 and $1.05682. A break above these resistance zones could reinforce bullish momentum, potentially pushing the pair toward higher levels.
On the downside, immediate support is situated at $1.03721, with further safety nets at $1.03415 and $1.03012. The 50-day Exponential Moving Average (EMA) at $1.03986 provides dynamic support, suggesting that the short-term trend remains favorable for the bulls.
Holding above this level could further cement the bullish outlook, encouraging buyers to test higher resistance levels.
From a technical perspective, the upward movement is supported by improving sentiment and technical strength, with the pair maintaining its position above key support levels.
However, if EUR/USD fails to hold above the pivot of $1.04324, it could invite selling pressure, potentially driving prices toward immediate support levels.
Traders should closely watch the resistance at $1.04971, as a sustained move above this threshold could confirm further bullish sentiment. Conversely, a break below the pivot may expose the pair to further downside risk.
Related News
- GOLD Price Analysis – Jan 24, 2025
AUD/USD Price Analysis – Jan 23, 2025
Daily Price Outlook
Despite new economic measures by Chinese authorities, the AUD/USD currency pair continues its downward trend, staying under pressure around the 0.6265 level, with an intra-day low of 0.6282.
However, the main reason behind this decline is the strength of the US dollar, which gained momentum after President Donald Trump issued a memorandum directing federal agencies to investigate and address the ongoing trade deficits.
Meanwhile, traders are increasingly expecting the Reserve Bank of Australia (RBA) to cut interest rates as early as next month, which has also contributed to the weakness of the AUD/USD pair.
AUD/USD Struggles as Strong US Dollar Gains Support from Economic Data and Fed Expectations
On the data front, the broad-based US dollar is holding steady above the 108.00 level, supported by President Donald Trump’s memorandum, which directs federal agencies to address ongoing trade deficits. This has strengthened the US dollar, putting pressure on the AUD/USD currency pair.
Traders are closely watching upcoming data, including Friday’s release of the preliminary US S&P Global Purchasing Managers Index (PMI) and Michigan Consumer Sentiment Index for January. These indicators are expected to give further clues about the US economy’s direction.
The US dollar could continue to rise as traders expect the Federal Reserve (Fed) to keep its benchmark interest rate unchanged at 4.25%-4.50% in January.
Moreover, Trump’s policies could push inflation higher, possibly limiting the Fed to just one more rate cut. US retail sales rose 0.4% in December, weaker than expected, while the Consumer Price Index (CPI) increased by 2.9% year-over-year.
Therefore, the strengthening US dollar, supported by President Trump's trade policies and economic data, is putting downward pressure on the AUD/USD pair. Traders expect the Fed to keep interest rates steady, which further supports the US dollar, weakening the Australian currency.
AUD/USD Under Pressure Amid US-China Tensions and Weaker Australian Markets
On the AUD front, the Australian markets are feeling the pressure from global developments, particularly the growing tension between the US and China. The US President, Donald Trump, announced a 10% tariff on Chinese imports starting February 1, citing concerns over fentanyl shipments.
In response, Chinese Vice Premier Ding Xuexiang warned that trade wars have no winners, highlighting the potential risks for both countries. These developments are concerning for Australia, given its strong trade ties with China, making the Australian economy sensitive to changes in China's economic policies.
Meanwhile, Chinese authorities have taken steps to stabilize their stock markets, such as allowing pension funds to invest more in domestic equities and introducing a pilot scheme for insurers to purchase stocks in 2025.
The People's Bank of China has also indicated that they will take measures to support the market when needed.
Despite these efforts, the S&P/ASX 200 Index fell below 8,400, primarily due to a decline in mining stocks, as weaker commodity prices impacted the sector.
This drop in Australian stocks occurred even though Wall Street posted strong gains. Investors are cautious as they await the potential impacts of President Trump's policy changes, keeping pressure on the AUD/USD currency pair.
AUD/USD – Technical Analysis
The Australian dollar (AUD/USD) is trading at $0.62713, experiencing a minor decline of 0.02% as it hovers around a critical pivot point at $0.62435. The currency pair has shown resilience above this level, with the 50-day Exponential Moving Average (EMA) at $0.62422 providing key short-term support.
A break above immediate resistance at $0.62943 could pave the way for further gains, targeting subsequent resistance levels at $0.63342 and $0.63763, where selling pressure may intensify.
On the downside, immediate support is seen at $0.62147, with additional safety nets at $0.61865 and $0.61452. A decisive move below these levels could signal a shift in market sentiment, exposing the pair to further downside risk.
The prevailing market structure suggests cautious optimism, with the pair maintaining a slightly bullish bias above the pivot, supported by steady buying interest.
Technical indicators highlight a consolidation phase, with the 50-day EMA acting as dynamic support. However, sustained upward momentum is required to confirm a breakout beyond the current range.
Market participants are closely watching upcoming economic data releases and broader risk sentiment to gauge future price action.
Traders may consider entering long positions above $0.62570, targeting $0.63210, while placing a stop loss at $0.62142 to manage downside risks.
Related News
- GOLD Price Analysis – Jan 23, 2025