EURUSD TECHS: Clears The 50-Day EMA

• RES 4: 1.0630 High Dec 06
• RES 3: 1.0513 50-day EMA
• RES 2: 1.0437/58 High Jan 6 / High Dec 30
• RES 1: 1.0356 20-day EMA
• PRICE: 1.0297 @ 06:04 GMT Jan 15
• SUP 1: 1.0178 Low Jan 13  
• SUP 2: 1.0138 1.764 proj of the Sep 25 - Oct 23 - Nov 5 price swing
• SUP 3: 1.0122 2.0% 10-dma envelope
• SUP 4: 1.0031 2.000 proj of the Sep 25 - Oct 23 - Nov 5 price swing    

The trend condition in EURUSD remains bearish and the latest recovery is considered corrective. Last week’s move lower resulted in a print below 1.0226, the Jan 2 low. The break of this support confirms a resumption of the downtrend and maintains the bearish price sequence of lower lows and lower highs. Sights are on 1.0138 next, a Fibonacci projection. Resistance to watch is 1.0437, the Jan 6 high.

• RES 4: 137.75 Low Dec 10            
• RES 3: 135.15 High Dec 13 
• RES 2: 132.78 20-day EMA
• RES 1: 131.09/71/132.57 High Jan 14 / 9                
• PRICE: 130.43 @ 05:44 GMT Jan 15
• SUP 1: 130.58/57 Low Nov 6 ‘24 and key support (cont) / Intraday low     
• SUP 2  130.44 Low Jul 5 ‘24 (cont)            
• SUP 3: 130.23 Low Jul 3 ‘24 (cont)
• SUP 4: 130.00 Psychological round number      

The trend in Bund futures is unchanged, it remains bearish and Tuesday’s fresh cycle low reinforces this theme. The contract has cleared key support at 132.00, the Nov 6 low. The clear break of this level strengthens a bearish theme. Sights are on the 130.00 handle next. Key short-term resistance is at 132.78, the 20-day EMA. Gains would be considered corrective and allow an oversold condition to unwind.

USD/JPY is moving lower, the pair last near 157.50/55, close to session lows. We are up around 0.30% in yen terms, comfortably the best G10 performer in what has been a muted session ahead of the US CPI print later. 

• USD/JPY's down move has been aided by remarks by BoJ Governor Ueda in Tokyo (per BBG/Rtrs). Ueda stating that a rate hike decision will be made next week at the policy meeting. The Governor noting US economic developments and wage trends will be key watch points. He added that the recent branch managers meeting expressed positive trends around wage trends. See this BBG link.
• The comments largely echoed those made by Deputy Governor Himino yesterday, but no push back from Ueda on rate hike has likely encouraged markets to believe next week's meeting is a live one. Current OIS pricing indicates: a 69% probability of a 25bp hike in January; a cumulative 86% chance by May; and a full 25bp increase not fully priced in until May 2025. The Jan meeting odds have risen since Himino spoke yesterday.
• For USD/JPY levels, lows earlier this week were at 156.92, while the 20-day EMA is around 156.71.