On the forex front, the U.S. Dollar Index eased from a four-month high, slipping 0.1% on the day to 98.75, as the Fed flagged risks to the economy from the spread of coronavirus. The U.S. Federal Reserve Chairman Jerome Powell will testify before the Senate Banking Panel.
The European Commission will report December industrial production (-2.0% on month expected). The U.S. Treasury will release the January monthly budget statement (10.0 billion dollars deficit expected).
BTC/USD – Daily Analysis
The BTC/USD recovers the bullish trend on breaking over $10,200 resistance. The leading cryptocurrency BTC holds the bullish price action, but a growing wedge pattern looms to trigger a reversal in the short term. The pair is testing the new 2020 top following a compelling return of over $10,000.
The Bitcoin current pullback to the support at $9,700 was required for the bullish activity taking place at the moment. The Bitcoin is now back in the bullish territory over $10,000, and it has also placed a new yearly high of $10,355.
Following an adjustment, BTC/USD is staggering at $10,317. The sharp move over $10,000 and the resistance at $10,200 seems to have woken the slumbering buyers. For now, the focus is to pull Bitcoin over the next resistance level of $10,400, which is anticipated to make another strong breakout in the direction of $11,000.
BTC/USD – Daily Technical Levels
Pivot Point 9,901.44
BTC/USD – Daily Forecast
The BTC/USD surged dramatically to crossover the double top resistance level of 9,875, which has opened further room for buying until 10750. The recent daily candle close is bullish engulfing in nature, and it may drive more buying in the leading cryptocurrency today. While the immediate support continues to prevail around 9,875.
EUR/USD – Industrial Production m/m
The EUR/USD currency pair stopped its declining streak and returned above the 1.09 level, mainly due to Federal Reserve’s Chairman Jerome Powell, who ignored the impact of the coronavirus on the U.S. economy, as in result, the risk-sentiment recovered instantly. The coronavirus development headlines also gave support to the risk sentiment.
The EUR/USD currency pair is currently trading at 1.0913 and consolidates in the range between the 1.0912 – 1.0923. However, the pair have hit the low of 1.0891 on Tuesday.
As we already mentioned that the EUR and most other currencies got support against the U.S. dollar during the North American session as Federal Reserve’s Chairman Jerome Powell did not give any attention to the coronavirus impact on the U.S. economy.
At the coronavirus front, the Chinese President Xi’s announced that our country would win the battle against the virus and be more wealthy soon. It should be noted that Powell will be testifying again before Senate on Wednesday and could repeat what he said on Tuesday.
EUR/USD – Daily Technical Levels
Pivot Point 1.0925
EUR/USD – Daily Forecast
The EUR/USD is trading at 1.0912 as the technically bearish Euro doesn’t seem to halt sell-off. At the moment, the pair is very close to the strong support level of 1.0879, and the EUR/USD has also closed a daily candle above this level.
Besides, the pair has also formed a Doji candle followed by a strong bearish trend, which signifies the chances of a bullish reversal until 1.0945 and 1.0980. Still, the smaller timeframe is not yet confirming the buying opportunity. On the upper side, a breakout of 1.0925 can drive buying in Euro; elsewhere, it may continue trading bearish until 1.0880.
GBP/USD – CB Leading Index m/m
The GBP/USD currency pair flashing green and struggles to continue its 2-day bullish streak ahead of fresh clues. The GBP/USD is trading at 1.2962 and consolidates in the range between the 1.2950 – 1.2970. However, the currency pair recently got support from the weaker U.S. Dollar and positive fundamentals in the United Kingdom.
The currency pair gained some ground on Tuesday despite the weaker U.K. data, as the Bank of England did not succeed in giving any clear direction to the British Central Bank’s future moves.
The report came that the U.K. economy drifted sideways in Q4, and now the focus is on Q1 for a recovery. Generally, a decline in the activity could be the reason amid Brexit uncertainty, the general election, and global trade tensions.
However, early 2020 data are indicating a recovery. If these economic figures don’t grow, BoE Governor Carney has signaled that the BoE will likely need to add more accommodation.
GBP/USD – Daily Technical Levels
Pivot Point 1.2963
GBP/USD – Daily Forecast
On the 4 hour timeframe, the GBP/USD is attempting to break above the resistance level of 1.2963, which also marks the pivot point of the time. On the downside, the GBP/USD may continue its bearish trend until 1.2922. The leading indicators, such as RSI and MACD, also confirms the strong bearish sentiments. Their values are holding around 80 and seem to come out of the overbought zone, which may help with the bearish trend continuation. Consider staying bearish below and bullish above 1.2963 today.
All the best for today.