24.01.201909:26 Forex Analysis & Reviews: Trading plan for 24/01/2019

The rest of the currency market is relatively calm. EUR / USD is trading within the range of 1.1370 / 90; USD / JPY has edged up to 109.70. GBP / USD remains strong at 1.3060 due to the optimism that the risk of unordered Brexit can be ruled out.

There is little activity on the stock market, as investors are hesitant about the prevailing uncertainty surrounding political themes in the US and China. Chinese Shanghai Composite is growing by 0.4 percent, and Japanese Nikkei225 is down 0.1 percent.On the commodity market, crude oil loses 0.5% and the climate was dominated by the information that the EU is looking for ways to circumvent trade sanctions imposed by the US on Iran.

On Thursday, the 24th of January, the event of the day is ECB Interest Rate Announcement scheduled for 12:45 pm GMT, but the global investors should keep an eye for PMI Services, PMI Composite and PMI Manufacturing data from France, Germany, and Eurozone. The same kind of data will be published in the US as well.

AUD/USD analysis for 24/01/2019:

The Australian job market data released overnight were better than expected. The Unemployment Rate has decreased to the level of 5.0% from 5.1% (against 5.1% expected) and the Employment Change data (tracks the number of the employed in Australia) were released at the level of 21.6K, which was lower than a month ago figure of 39.1k, but better than expected number of 17.3K. However, the details of the report were not so successful because the employment structure indicated a strong increase in part-time work, and the drop in the unemployment rate came from a lower participation rate as well.

The percentage of individuals in the labor force who are without a job but actively seeking one. A lower Unemployment Rate is generally better on the economy. Not only does it mean that resources are being fully utilized, but it also results in higher consumer spending as there are more workers receiving paychecks. This might help to create higher inflationary pressure and in the result - a more probable interest rate hike in the future.

Let's now take a look at the AUD/USD technical picture after the decision was made. After the initial rally towards the technical resistance at the level of 0.7175, the market has broken clearly below the technical support at the level of 0.7113 and currently is on its way towards the next technical support at the level of 0.7070. The negative and weak momentum supports the bearish outlook despite the oversold market conditions.

Please notice, the bulls have lost the fight of the lower channel boundary line around the level of 0.7125 as well, which additionally signifies the importance of the recent breakout to the downside.

Sinking Aussie drags a neighbor behind him - NZD is the second weakest currency in majors. NZD / USD reverses yesterday's increases and goes down to the level of 0.6770 at the time of writing.