Forex News January 20, 2022

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The Australian dollar has led gains so far on the day, with a higher employment data earlier supporting RBA rate rise expectations, which is keeping the currency firmer. Adding to that is the day’s stronger risk sentiment, albeit shares are reversing gains in the first half-hour of European trade. The rise in the Australian dollar is also aided by a break in the AUD/NZD rate.
The pair has broken out of its recent range, which has been in place since the end of December, and is making a push to the upside. • Elsewhere, the dollar remains lukewarm and lethargic, with EUR/USD rising a tad to 1.1360.
There are substantial expiries in the pair around 1.1350-60, so be cautious in case it pulls price action back to present levels.
Aside from that, USD/JPY is unchanged at 114.35, while GBP/USD is slightly higher at 1.3630, but remains below its important hourly moving averages of 1.3642-44. Meanwhile, USD/CAD is falling and remains below its 200-day moving average of 1.2500.

USD/CAD continues to flirt with key daily support levels this week; the pair has yet to fall below its 200-day moving average.
Close but no cigar. That has been the storey for USD/CAD over the last week or so, as sellers continue to press the pair lower but are unable to establish the next leg lower.
This comes as price continues to knock on the door of the 200-day moving average (blue line), before bouncing and closing above the key support level by the end of the day. As a result, any significant negative momentum is limited for the time being. Despite the fact that markets have had a tough time recently, the dollar has managed to stay up.
Higher oil prices are helping the loonie, but risk sentiment is undoubtedly still the major mover for now, as seen by sellers’ inability to achieve a breakthrough. China’s rate drop today will offer some early encouragement to risk trades, but stocks aren’t looking great following yesterday’s losses. • Despite the fact that markets are now holding up, mood remains quite fragile. In any event, the 200-day moving average for USD/CAD will remain a major point of interest in evaluating the pair’s next directional move. If the price falls below this level, the decline is expected to intensify.
Hold above, and buyers will gradually regain momentum in pursuit of the next rally (key hourly moving averages spotted @ 1.2513-45).

European indexes are presently down 0.3 percent to 0.5 percent on the day, while US futures have seen gains fade following a more positive handover from Asia to Europe. S&P 500 futures are now up 0.3 percent, Nasdaq futures are up 0.5 percent, and Dow futures are up 0.2 percent. That pales in contrast to how I felt three hours ago.
For the time being, equities are holding their ground, but after yesterday’s selling managed to overpower dip buyers, I am concerned that the now mildly bullish attitude may shift again later in US trade.
European indexes are presently down 0.3 percent to 0.5 percent on the day, while US futures have seen gains fade following a more positive handover from Asia to Europe.
S&P 500 futures are now up 0.3 percent, Nasdaq futures are up 0.5 percent, and Dow futures are up 0.2 percent. That pales in comparison to the atmosphere three hours earlier.
For the time being, stocks are holding on, but after yesterday’s selling managed to overpower dip buyers, I’m concerned that the now moderately optimistic mood may change again later in US trade.

Buying on dips below $41K is not yet a reason to be optimistic.
For the third day in a row, the Crypto Fear and Greed Index has remained at 24, matching the high fear evaluation.
However, such a low index value at this time tells us little about the dynamics of a market whose total capitalization has been fluctuating between $1.95 trillion and $2.00 trillion since Tuesday.
Bitcoin has risen 0.4 percent in the last 24 hours to $41.9K, despite a drop in US market indices following Wednesday’s results.
Buying on losses below $41K is not yet encouraging, since a downtrend with lower highs has been in place for more than a week.
Technical analysis indicates that this is frequently followed by a retreat. When the bulls burst past the downside barrier, reversal patterns are not ruled out. In our situation, stability over $45K would indicate an upward reversal.
Within the weekly trend, local positive dynamics in bitcoin and ether were offset by a setback in Cardano and a further drop in Solana.
While purchasing mood is high among market players as the stock market falls, bulls in cryptocurrencies are also refusing to give up psychologically crucial support levels, which are presently at $40K for Bitcoin and $3K for Ether. A consolidation below them might be a sign of a decline acceleration.
The fate of today’s clash might be dictated by stock market dynamics, since the main indexes – the Nasdaq 100 and Dow Jones 30 – have corrected to their 200-day moving averages.