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Investors have one less thing to worry about, the US government shutdown is over. President Trump has signed the stoppage bill and kicked the can until the Feb 8th. The drama could potentially return at a later stage (February 8) and the dollar index would see an impact of this.

The BOJ kept its monetary policy steady and this kept the bulls in check. However, this doesn't mean that the Yen bulls have gone to sleep. The devil is in detail, the bigger message from the BOJ is that there is no need to further loosen up the monetary policy. And if this is the scenario which the BOJ is looking at, then surely the next move would be to start following up the footsteps of other central banks such as the European Central Bank. The ECB started their tapering process last year and it is highly likely that the ECB would be able to wind up the tapering process this year. The BOJ is comfortable with the concept that the price has stopped falling and this is the area of their focus.

While the Sterling-Dollar pair is still recording its best level and marching towards 1.40, the EU has made it clear that the U.K. will never be given a chance to cherry pick the products that they desire. Theresa May hasn’t shown her plan for the financial sector after Brexit, but her team hopes that the UK would get fuss access to the EU. The businesses over in the UK are seeking clarity and the government is constantly failing to provide that. This dampens the business growth perspective and their ability to initiate any measure to stimulate the growth in the country.

Trade wars are highly unproductive but surely Trump doesn't think that way. By adopting this strategy the message is clear that the US leader has no concerns in achieving global peace and growth. The trade war is on, the president of the US increased the duty on solar panels. Foreign solar panel producers could shrug this off by focusing on other markets while the price of solar over in the US would rise considerably, putting renewable energy at disadvantage.

Solar panels have been the area of growth. Slamming a 30% import tax on the solar panel is going to create more obstacles and unfortunate circumstances for Americans because nearly 80% parts are foreign imports. President Trump notched up the trade war by increasing duties on imported washing machines by nearly 50% and the policy is aimed to dent Samsung and LG's presence in the local market.

The Euro-dollar pair is showing its strength against the dollar ahead of the European Central Meeting which is on Thursday. The upcoming ZEW survey for Germany would provide further evidence of strength the improvement in the current and expected situation. The German ZEW number provided a lot of tailwind during the third quarter of 2017 for the German GDP growth.

Netflix has flexed its muscles last night and the company has shown its investors that the competition doesn’t bother them. From their earnings, it shows they are the king of the entertainment business. The firm is execution on its plans which is yielding impressive growth. Netflix is taking an advantage of cheap money to fund its projects, however, if their access to capital is restrained, it could have problems

Regulators over in the UK has sent a clear message to Fox News owner, Rupert Murdoch that they are not ready for this kind of takeover bid. The memo was clear that the deal is not in the interest of the public because this gives Fox News owner more control over them UK media. Fox's stock is loved among analyst with 13 buy ratings, 9 hold and 1 sell. Over the year, insiders have built their position by 0.32%. Among its peers, the stock trades at 12% premium (over a 2-year time frame). As for sky, it isn't the most famous company with buy ratings, only 6 analysts have a buy rating and most of them are waiting for the takeover situation to be resolved. Hence the hold rating is 12. In comparison with its peer, it is trading at 6% premium.

The European Central Bank holds a two-day monetary policy meeting this week with its first policy decision of the year due at 12:45 GMT on Thursday. Following surprisingly hawkish minutes of the December meeting and a series of data beats, expectations have risen that the ECB will end its asset purchase program (APP) when the current one expires at the end of September 2018. However, a stronger euro could pose a threat to the Eurozone’s improving growth and inflation outlook, prompting the ECB to strike a more cautious tone with its plans to wind down its stimulus program.

In December, most Governing Council members agreed that the Bank’s communication should “evolve gradually” to reflect the progress made with inflation. The minutes suggested policymakers were considering revising the forward guidance in early 2018 so as to shift the focus from bond purchases to interest rates. This fuelled speculation that the ECB is unlikely to extend the APP beyond September 2018 and that rates could begin to rise at the end of 2018 rather than in 2019.

The minutes, released on January 11, added fresh impetus to the euro’s end of year rally, helping the single currency break above the $1.23 level for the first time since December 2014. But the euro’s impressive streak has already caught the attention of ECB policymakers as several have come out during the past week to warn against an excessive rise in the exchange rate. The what appeared to be coordinated comments were followed by a Reuters story that according to ECB ‘sources’ the central bank is not planning on making any changes to its forward guidance just yet.

This indicates the ECB will be sticking to its existing language on Thursday and President Mario Draghi will likely use his press conference to quash speculation of an early exit from QE and to indirectly raise concerns about the negative effects of a sharp appreciation of the euro. With Eurozone inflation still running below the ECB’s target of close but below 2% (1.4% in December), Draghi will not want to risk upsetting the recovery by driving up the euro.

The recent surge in oil prices raises the possibility of CPI meeting the 2% target sooner than anticipated. However, some of those gains will be offset by the stronger exchange rate, whose effects could be more pronounced in the core CPI rate, which the ECB puts more focus on for assessing the underlying trend of inflation. Investors could therefore be complacent about the impact of the euro’s strength on ECB policy and underestimating the risk of a rising currency prolonging the QE exit timeline.

If the ECB keeps monetary policy and its forward guidance unchanged on Thursday as expected, the euro’s response will depend on whether Draghi will flag the March 7-8 policy meeting as the likely date when it will revise its communication. This is very probable given that new staff forecasts will be available by then. The euro could jump to $1.25 in such an event. A more limited upside move is likely if Draghi gives little away regarding future policy direction but refrains from using strong verbal intervention to put a cap on the euro’s gains.

However, the single currency could come under selling pressure if the ECB sticks to a cautious price outlook and reiterates the importance of maintaining its asset purchases until inflation is on a sustained upward path. Any signs that the ECB is abandoning the link between bond purchases and inflation in its guidance would only fuel the euro rally and Draghi would not want to be seen raising such expectations prematurely. A dovish stance on Thursday could push the euro below recent support near $1.2165.

Spot Gold remains constructive on Tuesday and retested last Friday’s recovery high at $1338, signaling extension of recovery leg from $1324 (low of $1344/$1324 correction). The yellow metal maintains positive tone despite the greenback fresh strength on deal of US lawmakers to end crisis on government shutdown. Daily techs remain in full bullish setup and favor further advance for regain of $1344 pivot, break of which would signal continuation of broader uptrend. Rising 10SMA contained recent correction and continues to track the rally, offering initial support at $1331 which guards key near-term support at $1324.

Res: 1338, 1344, 1350, 1357
Sup: 1331, 1326, 1324, 1319

The Euro remained stable against the US Dollar during the previous session. The expected decline was restricted by a massive support cluster in the 1.2250/25 area.

However, the pair has likewise failed to overcome the 1.2270 mark, thus confirming the upper boundary of a one-week descending channel. It showed low volatility early today, as the 55– and 100-hour SMAs limited any attempts to edge lower.

The Euro's movement during the previous sessions demonstrates that bears are restlessly trying to push the rate below this massive support. Thus, it is more likely that the pair remains tended southwards in this session.

Given the strength of this support, the rate might continue its movement sideways. Upside target for today should be the weekly R1 at 1.2305.

The Pound was driven by strong upside momentum against the Greenback on Monday, thus closing the session with a 94-pip gain. As a result, the pair breached the combined support of the weekly R1 and the upper boundary of a three-month ascending channel near 1.3960.

Shorter-term patterns, however, demonstrate that the strong movement north apparent during the previous week is starting to allay. Thus, the Sterling moving above the 1.3960 level might actually be a false breakout.

Technical indicators suggest that the pair could trade lower within the following days. This session, however, might still mark a slight up-move towards the weekly R2 at 1.4061.

Subsequently, the rate is expected to edge lower towards the 55– and 100-hour SMAs circa 1.39.

USD/JPY was struggling to move past the 100-hour SMA and the weekly PP during the first half of Monday. However, strong hourly surge mid-session resulted in a breakout of the aforementioned levels and the 55– and 200-hour SMAs.

The Yen strengthened early today in the wake of BOJ comments about upbeat inflation outlook. This fundamental advantage, however, did not hold strong, as the US Dollar returned to test yesterday's peak of 111.15.

The pair being located above all three SMAs flashes bullish signals; however, other indicators favour a decline in price. In case this bearish scenario occurs, the Greenback should be limited by the monthly S2 and the weekly S1 circa 110.20.

Conversely, the prevalence of bulls would send the rate for a test of the weekly R1 and the monthly S1 near 111.50

XAU/USD spent Monday's trading session within the bounds of the 100– and 200-hour SMAs and the weekly PP in the 1,329.07/1,334.85 area. The pair, however, managed to accelerate early today and thus breach a one-week descending channel.

Being supported by the 55-, 100– and 200-hour SMAs circa 1,332.00 is likely to pressure the rate upwards in this session. Gains, however, are expected to be limited, as the nearest resistance is set by the weekly R1 and a four-month high circa 1,344.00.

By and large, Gold's appreciation during the past trading sessions was driven by the strong support of the 200-hour SMA. It is likely that this moving average continues to provide unbreakable support this week, thus sending the pair above its four-month high.

The Canadian Dollar was almost unchanged against the Greenback on the country's wholesale sales report. The USD/CAD currency pair ignored the report to rise 1 base point, remaining in the 1.2465 area.

The value of Canada's wholesale sales increased for the second month in succession in November amid wide gains across food, vehicle and other sectors. Statistics Canada stated that the country's wholesale trade expanded 0.7% in the reported month, which was shy of expectations for a 1% rise, following an upwardly revised 1.6% previously. The wholesale sales report tends to be overlooked by markets, despite its bigger weight in the country's GDP than the closely monitored retail sales. Canadian retail sales data is due on Thursday.

The USD/JPY exchange rate depreciated 23 base points to the 110.68 level, following the BoJ monetary policy statement and the outlook report. Though, the pair managed to recover in the next couple of hours to be above the 111.00 mark, as the Bank's Governor made dovish remarks, sending rate higher.

The Bank of Japan kept the interest rate unchanged at a negative 0.10%, as widely anticipated, offering a more optimistic view on consumer inflation projections, underscoring the conviction that the Japan economy was making moderate, but steady progress to the 2% CPI growth target. Later, the BoJ Governor Haruhiko Kuroda indicated that the Bank was not in a position to consider the QEE quit.

WTI oil price ticked higher on Tuesday and probes again above $64 barrier, as focus turns towards US crude inventories data (API report due today and EIA report due on Wednesday).

Strong bullish signals have been generated on daily chart (Friday’s Hammer and Monday’s bullish outside day) which signal that corrective phase from $64.87 to $62.83 might be over.

Recovery needs firm break above $64 barrier (top of thick 4-hr cloud at $64.04 and Fibo 61.8% of $64.87/$62.83 pullback at $64.09) to generate fresh bullish signal and open way for retest of $64.87 (15 Jan high, the highest since late 2014).

Break here would signal recovery continuation and expose next significant barrier at $66.75 (50% retracement of 2014/2016 $107.45/$26.04 descend).

Bullishly aligned near-term studies are supportive, however, overextended conditions on daily chart and weakening momentum studies, require caution.

Alternative scenario sees increased risk of deeper pullback on violation of key near-term support at $62.80 (correction low posted on 19 Jan) which would expose next strong support at $61.51 (Fibo 38.2% of $56.08/$64.87 upleg).

Res: 64.09, 64.32, 64.87, 65.00
Sup: 63.73, 63.36, 63.04, 62.80