After a lukewarm FED meeting, the highest weekly volatility came from Donald Trump's confirmation of tariffs against its closest partners, Canada and Mexico, effective February 1st. Although the beginning of the week is light on the news, the de-facto renegotiating his USMCA deal could cause significant volatility with both USD and CAD.
Looking back at recent setups, both AUD NZD and CHF JPY failed to break higher despite significant gold strength which is positively correlated with these currencies.
Weekly Calendar
- Monday: IS Manufacturing – USD
- Tuesday: JOLTS Job Openings- USD, Unemployment – NZD
- Wednesday: ADP Employment, ISM PMI – USD
- Thursday: BOE Interest rate – GBP, Unemployment – USD
- Friday: NFP – USD, Unemployment – CAD
Setups In Focus
GBP SGD
In the longer term, downside potential is around 500 pips. Both monthly and weekly charts align short, as weekly broke and retested a longer-term consolidation. 1.68750 is a key level to watch above the market, and as long as it holds – it can provide selling opportunities. A level to watch below the market is suport at 1.66615.
GBP SGD 4 Hour Chart, Source: TradingView
CHF JPY
This pair failed to break and hold above the resistance of 172.100 and is likely to test the support at 168.135 next. Ideally, a sell-setup would include a pullback to 171.400, taking out last Thursday's high but failing to break initial resistance before continuing lower and creating a favorable R:R ratio of at least 1:3.
CHF JPY 4-hour chart, Source: TradingView
It is important to note a relatively even retail sentiment for long and short that doesn't favor retail squeeze shorts yet.
Notes:
- AUD JPY: Turned back to long-term range, with support at 95.24.
- AUD CAD: Bullish, but for further strength, needs to close above resistance at 0.90700.
- AUD SGD: Broke out bearish but fell back into the range. It is likely to oscillate around the long-term bearish channel.
- AUD CHF: Remains in a bearish consolidation, with an established 80 pip range.
- CAD JPY: Broke bearish owing to CAD fundamental developments. Strong support is around 105.800.
- CHF SGD: At weekly/monthly strong support. It shows a potential for longs if the level holds.
- EUR AUD: Long-term signs of bullishness on both monthly and weekly. Daily needs more clarity.
- EUR JPY: Broke lower below a key level of 161.660. Further weakness is possible to take out January lows.
- GBP JPY: Remains in a broad range for months, with support at 190 and resistance at 199.
- NZD JPY: It fell back into the range but has a bearish bias.
- SGD JPY: Fell back into the long-term consolidation, which has been in play since September 2024.
Note: Any opinions expressed in this article are not to be considered investment advice and are solely those of the authors. Singapore Forex Club is not responsible for any financial decisions based on this article's contents. Readers may use this data for information and educational purposes only.
