The EUR/USD pair is holding near the 1.1900 level after rising from last week's lows, as pressure on the US Dollar intensifies due to concerns over the US labor market and expectations of Fed policy easing. Meanwhile, the Euro is receiving neutral support from the ECB, which continues to signal interest rate stability.
Possible technical scenarios:
What we witness on the daily chart is that the EUR/USD pair has held above support at 1.1788 and is attempting to consolidate above the 1.1898 level. If successful, the upward move could continue toward 1.1961 and 1.2010.
Fundamental drivers of volatility:
On the US side, pressure on the dollar is mounting as labor market expectations deteriorate. White House adviser Kevin Hassett stated that job growth could slow in the coming months due to migration policies and higher productivity. These comments, coming just before the January employment report, have fueled doubts about labor market resilience and weakened the USD. Futures markets indicate rising expectations for a Fed rate cut, with the market pricing in approximately a 75% probability of a move in June.
Additional pressure on the dollar stems from internal uncertainty within the Federal Reserve. Some officials acknowledge the need for a more accommodative policy, while others urge caution, citing unstable employment dynamics and risks to dollar credibility. Against this backdrop, investors are keeping a close watch on US macro statistics, including retail sales and the upcoming NFP report, which could dictate the market's direction.
As far as the Eurozone is concerned, significant drivers are limited. ECB President Christine Lagarde reaffirmed her confidence in inflation returning to the 2% target in the medium term, consistent with signals that rates will remain unchanged in the coming months. Amid a weak dollar and an absence of negative surprises from Europe, the EUR/USD pair is hovering near local highs, remaining sensitive to US data.
Intraday technical picture:
Given the unfolding scenario on the 4H EUR/USD chart, the pair is consolidating above the 1.1898 level, forming a bullish flag pattern. This lays the groundwork for a continued rally toward the immediate target of 1.1961.
The GBP/USD pair is dropping amid rising political risks in the UK and growing expectations of an imminent policy easing by the Bank of England.
Possible technical scenarios:
On the daily chart, the GBP/USD pair has held above the mirror level of 1.3533, which is marked by the dashed line, leaving room for an upward move toward targets at 1.3752 and 1.3914, despite the local correction.
Fundamental drivers of volatility:
Pressure on the Pound intensified following an escalation in the UK's domestic political situation. Prime Minister Keir Starmer has come under fire within the Labour Party amid a scandal linked to the Epstein case. Although Starmer has declared his intention to remain in office and avoid political instability, the uncertainty surrounding the country's leadership is increasing the risk premium for British assets and curbing demand for Sterling.
An additional headwind for the pound is the expectation of interest rate cuts by the Bank of England. New forecasts suggest inflation could slow below the 2% target as early as this spring, boosting expectations for a rate cut in March. Investors are pricing in a softer trajectory for the BoE compared to the Fed, which is pressuring the yield differential in favor of the Dollar.
On the US side, the dollar's dynamics remain more resilient ahead of key macro statistics. On Tuesday, market attention is focused on December retail sales data, which could offer clues regarding consumer demand. The main event of the week will be the January employment report, scheduled for release on Wednesday. The consensus points to moderate job growth and a stable unemployment rate, which is currently limiting the dollar's downside.
Consequently, the combination of UK political risks and BoE rate-cut expectations is creating downward pressure on GBP/USD, while US statistics may only adjust the scale of the move without altering the overall balance of risks in the short term.
Intraday technical picture:
Judging by the situation on the 4H chart, the pair is trading in the middle of the 1.3630–1.3752 range, from which it could locally move toward either boundary, especially in anticipation of US macro data.
The USD/JPY pair remains under pressure, with the yen holding near its highest levels in over a week amid a weakening dollar and rising expectations of policy tightening by the Bank of Japan.
Possible technical scenarios:
The USD/JPY pair dropped this week but is holding above the 155.03 level. If this support holds, the price may recover toward the nearest resistance at 157.90. Otherwise, the price range could expand toward 152.09–157.90.
Fundamental drivers of volatility:
The yen is supported by a reduction in Japanese political uncertainty following a decisive victory for the ruling Liberal Democratic Party in the snap elections. This clear mandate has boosted expectations for the continued normalization of the Bank of Japan's monetary policy, contrasting with the milder outlook for the Fed. An additional factor is the risk of currency intervention. Japanese Ministry of Finance officials and currency authorities have reiterated their readiness to step in if exchange rate movements do not reflect fundamentals, which is capping USD/JPY upside.
Fiscal risks in Japan, linked to the new government's plans for expanded budget spending, are limiting the yen's appreciation potential. That being said, these are currently offset by expectations of rising Japanese government bond yields and a more hawkish tone from the BoJ. Improving global risk appetite and easing geopolitical tensions in the Middle East occasionally weaken demand for safe-haven assets; however, they have not shifted the overall balance in favor of the yen.
On the US side, the dollar remains under pressure due to expectations of further Fed rate cuts and concerns surrounding the regulator's independence. The market is pricing in at least two rate cuts this year, widening the monetary policy divergence between the Fed and the BoJ. Additional pressure on the dollar comes from reports of waning interest from foreign investors in US Treasuries. In the near term, market attention shall be focused on retail sales data, but the NFP report and US inflation data remain the key anchors for USD/JPY, as they will determine the dollar's future path.
Intraday technical picture:
As we can see on the 4H USD/JPY chart, it remains unclear whether the 155.03 support will hold. The release of US data and the Dollar's reaction will likely allow the pair to define its direction around this level, either recovering toward 157.90 or breaking lower.
The USD/CAD pair is consolidating as market players evaluate divergent fundamental signals from Canada and the US ahead of key macroeconomic releases.
Possible technical scenarios:
On the daily chart, the USD/CAD pair has turned downward within the 1.3503–1.3744 range and is currently heading toward its support level. There is still some room to move toward 1.3503, after which the price is likely to reverse upward, continuing the pair's sideways trend.
Fundamental drivers of volatility:
In terms of Canada, the Canadian dollar received support from labor market data. Despite a decline in employment in January, the drop in the unemployment rate to 6.5% (a 16-month low) eased fears of a sharp economic slowdown. Job losses were confined entirely to part-time positions, which the market viewed as a less negative signal. Consequently, expectations for aggressive policy easing by the Bank of Canada have diminished, limiting USD/CAD upside and supporting the loonie.
On the US side, investors remain cautious ahead of retail sales data and the delayed January employment report. While the market anticipates moderate job growth, any deviations from the forecast could significantly impact the dollar. Stronger employment data could temporarily bolster the US currency, while signs of economic cooling would increase pressure on it amid Fed rate-cut expectations.
Overall, the balance of factors suggests neutral dynamics for the pair in the short term. The resilience of the Canadian labor market is checking CAD weakness, while the direction of USD/CAD in the coming sessions will largely hinge on signals from the US regarding consumer demand and the state of the labor market.
Intraday technical picture:
Given the situation on the 4H USD/CAD chart, the price is clearly stalling at the local support level of 1.3556, marked by the dashed line. That said, this level could be broken out, leading to a deeper decline toward the support of the broad 1.3503–1.3744 range.
Gold prices are edging lower on Tuesday following record highs reached in late January, as improved market sentiment bolstered stock markets and dampened demand for safe-haven assets.
Possible technical scenarios:
During its recovery, the price of gold consolidated above the 4939.80 level, clearing the path toward resistance at 5348.71, with significant room still left for an upward move.
Fundamental drivers of volatility:
The price came under pressure from a rally in global stocks, including in Asia, where markets gained momentum following the ruling party's convincing election victory in Japan. Meanwhile, the US dollar strengthened slightly, making dollar-denominated gold less attractive to investors from other currency areas.
Market focus is shifting to US macroeconomic data due throughout the week, including the employment report and inflation data. These releases could adjust expectations for the Fed's interest rate path. According to the derivatives market, investors are still pricing in two future rate cuts, which is limiting the dollar's potential for sustained strength.
Despite the current correction, the fundamental backdrop for gold remains supportive. The combination of geopolitical uncertainty, expectations of easing US monetary policy, and risks of a labor market slowdown creates a favorable environment for sustained interest in gold in the medium term.
Intraday technical picture:
Considering current developments on the 4H gold chart, the price is stalling for a second time below local resistance at 5090.38, marked by the dashed line. A breakout and consolidation above this level would open the way toward 5348.71. That said, if the psychological $ 5,000-per-ounce level cannot be overcome at this stage, a pullback and the continued formation of an ascending triangle are plausible.
Oil prices are rising for the third consecutive session as market participants weigh the risks of supply disruptions amid tensions between the US and Iran.
Possible technical scenarios:
On the Brent daily chart, the price has consolidated above the 66.51 level, opening the path toward the $70 per barrel target, with sufficient room for growth still available.
Fundamental drivers of volatility:
The primary source of support remains the tension between the US and Iran. Recommendations from US authorities for vessels to maintain a distance from Iranian territorial waters have refocused market attention on the Strait of Hormuz, through which approximately 20% of global oil consumption and the bulk of exports from Gulf nations—including Iran, Saudi Arabia, the UAE, Kuwait, and Iraq—pass.
Any escalation in the region carries the potential risk of supply disruptions, which keeps a geopolitical premium baked into prices. At the same time, comments from the Iranian side regarding a "good start” Omen-mediated negotiations with the US are reducing the likelihood of an immediate supply shock.
From a fundamental balance perspective, a supply surplus could act as a restraining factor. Even with high tanker utilization, the market is still perceived as oversupplied with.
Sanction risks remain an additional factor of uncertainty. The European Union is discussing expanding restrictions on Russian oil, potentially including sanctions on ports in third countries, which could complicate logistics. The US is also ramping up pressure on exports. These steps are already shifting trade flows: Indian Oil Corporation purchased 6 million barrels of oil from West Africa and the Middle East, avoiding Russian supplies in the context of trade agreement negotiations between India and the US.
Intraday technical picture:
The 4H chart shows that Brent price remains within an ascending channel. Following another bounce from its lower boundary, the price has the technical potential to climb toward previous highs in the $70 per barrel area.
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