Forex trading plan for January 19
Sanctions were lifted from Iran, and oil traded close to 13-year lows, though in general the market has tried to stabilize. On Tuesday the markets will be tested by Chinese statistics. Annual GDP growth rate is expected to stay at 6.9%, while the growth rate slowed down from 6.2% to 6.0%, while the retail sales growth rate slightly increased from 11.2% to 11.3%.
EUR/USD remains generally in range. On the upside the single currency is limited by the ECB meeting on Thursday: monetary easing this time is unlikely, though Mario Draghi will likely share bearish comments. Risk of weaker data from China is a supportive factor for the euro. The euro area will release ZEW economic sentiment index. Support is at 1.0880 and 1.0800, resistance is at 1.0940 and 1.1000.
GBP/USD fell to the bottom of the descending channel and the 2010 low at 1.4228. The pound is oversold, but taking into account the general situation, there’s the risk that support won’t hold. The UK will release inflation data at 09:30 GMT, but these data are unlikely to provide pound with significant support. If pound breaks below 1.4228, selling will accelerate and the pair will fall to 1.4100 and lower. Resistance is at 1.4360 and 1.4400. We'll look for buying opportunities at EUR/GBP in case of return to 0.7500.
USD/JPY found support at 116.50, but is in no hurry to get higher. The technical picture remains negative. Resistance is at 117.50/75 and 118.00. Support is at 117.00 and 116.50.
AUD/USD broke below the bottom of the previous trading range on Friday (1.6926) and fell below 2015 low (0.6896). The main scenario is the continuation to the downside, to 0.6775. The next resistance after0.6926 is at 0.7000.