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EUR/USD 1-month low

Brent crude oil – 4hr Candlesticks
Source: GKFX / MT4 (January 18, 2020)

Brent crude has been trending strongly higher but there is some sign of a short-term top in the form of a double top pattern on the 4hr chart as well as a bearish engulfing candle on the daily chart. A measured move from the pattern would target 53, whereas a move back over the neckline suggests a resumption of the uptrend.


•    Dollar bounces again on Friday (EUR/USD < 1.21) after disappointing US retail sales data
•    The euro and gold have lowest close in one-month as dollar rallies
•    Stock markets close week mixed in ‘sell the news’ reaction to Biden stimulus
•    Bitcoin drops back under $35k as google searches for Bitcoin soars
•    Weak US bank earnings sent cyclical stocks (Russell 2000) lower on Friday
•    Mayor de Blasio says NYC vaccine supply to run out next week
•    WEEK AHEAD: Biden inauguration, ECB/BOJ meetings, Netflix earnings
•    DAY AHEAD: China GDP, China IP, China retail sales, MLK Holiday


“It’s much easier to learn what you should do in trading than to do it. Good systems tend to violate normal human tendencies.”  - William Eckhardt


*Daily closing price
↘ EUR/USD    1.2078        (-0.64%)
↘ GBP/USD    1.3586        (-0.74%)
↗ USD/JPY    103.11        (+0.08%)
↘ S&P 500    3768.25    (-0.72%)
↗ Hang Seng    28,573.86    (+0.27%)
↘ Gold        1941.88    (-1.07%)
↘ Oil (Brent)    55.10        (-2.34%)
↘ Bitcoin    35,860        (-0.54%)



Dollar up again

The dollar spiked higher on Friday, adding to midweek gains. The US currency is attempting to bottom near 3-year lows. EUR/USD fell under 1.21 while GBP/USD was back under 1.36. Some nerves have crept back into the market after the Capitol protests while traders sold the news of Joe Bidens new stimulus plan. Traders have been selling the dollar ahead of expected rising debt issuance to pay for the Biden stimulus. 

Bitcoin 36k

Bitcoin has held above the $35k level but has failed to exceed the record highs despite rising public interest in the cryptocurrency. Google searches for ‘bitcoin’ now match the previous peak in 2017, which corresponded just before the BTC price topped out. The logic goes that crypto smart money is offloading their bitcoin to new buyers at high valuations.


The big move into cyclical stocks took a break on Friday following weak bank earnings and slumping oil prices while the 10-year Treasury yield pulled back from its highest level since March. Wells Fargo and Citigroup saw their stock slide 7.8% and 6.9% respectively after poorly-received Q4 results. More big US banks report earnings this week including Goldman Sachs. A pullback in the price of oil also weighed on oil stocks.


*Times in GMT
02:00 – China Gross Domestic Product (YoY)(Q4) [6.1 % Exp vs. 4.9 % Prev]
02:00 - Industrial Production (YoY)(Dec) [6.9 % Exp vs. 7 % Prev]
02:00 - Retail Sales (YoY)(Dec) [5.5 % Exp vs. 5 % Prev]


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