Forex Signals Brief for Jan 6: Iran Conflict to Weigh on Markets
Rowan Crosby • 2 min read
US Market Wrap
The bull rally came to an abrupt end on Friday as markets tumbled on the back of the news that that US had killed Iranian General Qassam Soleimani.
At this stage, investors are clearly still wary of further escalation of military activity between Iran and the US. But for others, this is just another bump in an already rocky road.
The news did send the SPX sharply lower, hitting the positive sentiment in the process while the Greenback got bid up. All the focus will be on how the markets respond to the Iran headlines as the day rolls on.
Looking at the week ahead and the big focus for traders will once again be on the US employment report on Friday.
December was a huge month for jobs where 266,000 were created, while the jobless rate sites at a 50 year low. So there is an expectation of another strong result here.
Today’s session will see the GBP/USD in-play early as we get services PMI data, while there is only second-tier releases for the rest of the session.
Again, much of the attention today is on market sentiment, so be prepared for some big moves in either direction.
Forex Signal Update
The FX Leaders Team had four wins from eight signals last week for a 50% strike rate in what was a quiet week for traders.
USD/JPY – Pending Signal
The USD/JPY now really dropped away from the 108.50 level as the JPY gets bid up sharply on the back of the Iran news. This is a trade that will rebound at some point, so be ready for that opportunity.
Gold – Pending Signal
GOLD had surged into the $1580 range and is very bullish for obvious reasons. This is clearly one that will be in play today, so we will be looking at opportunities for both long and short positions.
BTC has done a 180 as the $7,000 level continues to hold up.
After testing the $7,000 level, the bulls quickly took back control and pushed price back to the $7,500 level.
This was the fifth test of that level and once again it has held. The test didn’t shock me, but the fact that if rebounded so sharply was a bit of a surprise.
So for the time being, we are really seeing the two technical points holding firmly, but one of those areas will likely break as we get more participants coming back this week.