What’s The Price?
This Week’s Key FX Prices

Anything catch your eye? USDJPY providing the most volatility (standard) as the rest of the market takes a “moment to breathe” after the recent moves. Mixed messages through-out the FX market right now, which means we are getting to opportunity.

Technical Chart Of The Week
NZD/USD: Testing The Lows – What’s Next?

The NZD/USD is sitting at a critical juncture, trading near the bottom of its well-defined range. With the current price hovering between 0.5850 and 0.5900, a historically significant support zone, traders are watching closely to determine the next big move.

Support Holding Firm

The 0.5850-0.5900 zone has consistently acted as a launchpad for bullish reversals in the past, with multiple bounces leading to sharp rallies. Price action at this level suggests buyers are stepping in, evident from wick rejections and tight consolidation. A failure to hold this area, however, could signal a deeper sell-off.

Upside Resistance in Focus

To the upside, key levels to watch include:

• 0.6100-0.6200: An intermediate resistance zone, where sellers previously regained control.

• 0.6350-0.6400: The major range ceiling, with multiple failed breakouts marking it as a strong selling zone.

For bulls, reclaiming 0.6100 would be the first signal of strength, while a move beyond 0.6400 would confirm a trend reversal.

Bearish Breakdown Risks

Should 0.5850 fail to hold, the door opens for a continuation of the broader bearish trend. Below this, key levels include 0.5800 and potentially 0.5700, where fresh buyers may emerge.

This Week In FX
The Market Still Moves To Trump’s Beat.

Now the ‘Tariff Man‘ (strange superhero / villain name) is no stranger to dropping political statements either on X formerly known as Twitter, or his Truth Social platform.

But the upcoming president of the United States Donald Trump seems to have started his tariff campaign early by announcing plans to place 25% tariffs on Canada and Mexico. 

The market got spooked, especially USD/CAD which popped its head back above the 1.4100 resistance level. 

Those that traded in 2016 to 2020 will be very familiar with this narrative. I assume the Trump social media alert tracker will be re-instated now, and traders will be on edge for the next four years.

Why This Matters:

Trump’s tariff talk is back, here’s what to watch:

• Trump’s announcements will move markets – Unfortunately, as retail traders, we can only prepare for this by following and hitting the notification bell on Trumps socials.

• Volatility – I always use an ATR (Average True Range) for my stops, but when trading assets to do with the US or nations impacted by significant tariffs, it may pay to add a little extra on stops.

• Trading decisions – The difference this time around, Trump has the house and the senate, so passing bills will be easier. Is it smart to make snap decisions on these social media posts? No. Be thoughtful in your process still.

“Saddle up.” – Jonathan Kibbler, Market Wake-Up

Seasonal Pattern Spotlight
Pattern Of The Week: USDCHF

If you’re watching USD/CHF, here’s a pattern worth noting: the pair tends to drop off between late November and late December. Over the past 15 years, this has played out 12 times, a solid 73.23% hit rate.

On average, USD/CHF falls by -1.42% in December. Why? It comes down to capital repatriation. Toward the end of the year, Swiss companies and financial institutions bring funds back to Switzerland for tax purposes, balancing their books, and other financial housekeeping. This increased demand for CHF boosts its value, putting pressure on USD/CHF.

📉 What This Means for You: Keep an eye on this chart. If technical signals start lining up, December could present a solid opportunity to play on USD/CHF weakness. Don’t miss the move!

Macro Made Simple
The Power of Yield Curves

When trying to predict economic cycles, don’t just watch the headlines, watch the yield curve.

Focus on the 2-Year vs. 10-Year Treasury yield spread. When it inverts (the 2-Year rate rises above the 10-Year), it’s been a reliable signal of an impending economic slowdown. Historically, this inversion precedes recessions by 6-18 months.

Why it matters for traders:

• Currency Traders: A steepening curve often signals stronger growth expectations, favoring high-yielding currencies. An inversion might push traders into safe havens like USD, JPY, or CHF.

• Equity Traders: When the curve inverts, defensive sectors like utilities or consumer staples tend to outperform.

• Bond Traders: An inverted curve is a golden opportunity to consider long positions on longer-duration bonds.

This single indicator ties into the “why” behind markets moving, helping you anticipate sentiment shifts before they hit the mainstream.

Market History Flashback
2015: The Day the Swiss Franc Shocked the World

On January 15, 2015, the Swiss National Bank (SNB) made a surprise announcement that sent shockwaves through the forex market. It removed its 1.20 EURCHF peg, which had been in place since 2011 to prevent the franc from appreciating too much against the euro.

Traders were caught completely off-guard. Within minutes:

• EURCHF plummeted by 30%, hitting parity (1.0000) for the first time.

• Major brokers like FXCM faced massive losses, and some smaller firms went bankrupt.

• This event is now infamous as “Francogeddon.”

Why it Matters:
Central banks can intervene at any moment, especially during times of heightened volatility. This serves as a reminder to manage your risk and be prepared for the unexpected.

Trading Psychology Nugget
Unlocking the Secrets to a Trader’s Mindset

Ever wondered what separates successful traders from the rest? In this insightful video, we dive deep into the habits, strategies, and psychological tools top traders use to consistently thrive in the market. Hosted by experienced traders, this episode unpacks actionable tips designed to transform your approach to trading.

Learn how to build discipline, stay resilient in the face of losses, and develop a trading mindset that ensures long-term success. From managing risk effectively to mastering emotional control, this video is a must-watch for anyone looking to elevate their trading game.

Whether you’re a beginner or a seasoned trader, this episode provides a fresh perspective on achieving consistency in the volatile world of trading. Hit play now and start reshaping your trading mindset today! 💡

Key Events
Mark Your Calendars! 📅

Here are the main headlines for day traders to be weary of when trading this week.

View the full economic calendar on Trading Economics.

Weekly Deals
Your FX Weekly Deals!