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Last week we saw a handful of trading opportunities across the Forex majors in what was the first week back into the markets for many traders as we start the new year.

This week it is unlikely to be as eventful however we have some interesting releases coming our way as well as several central bank meetings. If we align ourselves correctly with the fundamentals then there will still be plenty of opportunities to take some pips out of the market this week.

Here’s our outlook for some of the most important currencies this week.

US Dollar

Last week the US Dollar showed strength across the board. One of the main factors for its bullish temperament was the US & China trade deal which will again be the focus of every trader this week. We already know that Beijing has given the all clear for Vice Premier Liu He to sign the phase-one deal which will take place in Washington DC on Wednesday. Whilst much of this is already priced in, Markets are still eagerly awaiting details of the trade deal which may leak prior to the signing. When the details arrive we can expect volatility whilst the markets take time to digest the information.

Putting the US-China trade deal aside, the US data coming this week is expected to confirm that the US economy remains robust. Of course we can assume there will be some surprises in there too so watch the economic releases carefully.

British Pound

It has been somewhat quieter for the British Pound in recent weeks in comparison to 2019. Prime Minister Boris Johnson’s majority has allowed him to get the Brexit Withdrawal Agreement through parliament with little resistance. It’s now over to the Lords although this is unlikely to cause any problems.

Focus now moves onto trade negotiations between the UK and the EU. President of the European Commission – Ursula Von Der Leyen was in London last week and despite friendly discussions it is clear that she believes that the deadline at the end of the year is tight and there’s a lot of work to be done in that time.

The pound should be calmer now as we go into 2020 however Brexit’s ferocious volatility could return if a no-deal looks at all possible toward the end of the year.

Australian Dollar

The bushfires in Australia continue to take their toll on the Australian Dollar just like we have seen in recent weeks. There’s scheduled data out every day next week except Wednesday. If the markets interpret any of these negatively we may expect further moves to the downside for the Australian pairs.

Have something to add? Have a question? Feel free to reach out in the comments below.

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