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The Greenback rose temporary against the Japanese Yen, following mixed US economic date on Friday. The USD/JPY currency pair added 28 base points or 0.34% to reach another strating point for a decline.

The US retail sales rose in December, as consumers bought more goods and the previous month’s figures were revised up, indicating that the country’s economy finished 2017 with solid momentum. The Commerce Department stated that retail sales increased 0.4% in December, following an upwardly revised 0.9% gain previously. Data was likely to bolster expectations of a stronger increase in consumer spending in the Q4. Consumer spending, which contributes for more than 60% of the US economic activity, grew at a 2.2% yearly rate in the Q3.

Today is Martin Luther King's Birthday, which is a Bank Holiday in the United States. As a result, the Economic Calendar is relatively light today.

US Federal Reserve Bank of Boston President Rosengren spoke from San Diego. He made comments about Fed policy and how the policy framework should be updated. He said that further drops in the Jobless rate risk undermining recovery. He also spoke about inflation and said that the Fed could set medium-term goals and inflation ranges, and sited the benefit of targeting the 1.5% to 3.0% inflation range. He laid out the case for the Fed to switch to an adjustable inflation goal within a fixed range. He said that a low and fixed inflation target is a potential problem but lower than expected inflation is not a problem near-term.

French Consumer Price Index (EU Norm) (YoY) (Dec) was released on Friday, coming in at 1.2%. The number was expected to be unchanged at 1.3%.

US Retail Sales (MoM) (Dec) were released as expected at 0.4%, from 0.8% previously, which was revised up to 0.9%. Retail Sales ex Autos (MoM) (Dec) came in as expected at 0.4%, from 1.0% previously, which was revised up to 1.3%. Retail Sales (Dec) Control Group was 0.3% v an expected 0.4%, from 0.8% prior. Consumer Price Index (YoY) (Dec) was as expected at 2.1, from 2.2% previously. Consumer Price Index Ex Food & Energy (YoY) (Dec) was 1.8% v an expected 1.7% and 1.7% prior. Consumer Price Index Ex Food & Energy (MoM) (Dec) was 0.3% v an expected 0.2%, from 0.1% previously. EURUSD fell from 1.21482 to 1.21120 after this data release.

German Buba President Weidmann spoke at the Ludwig-Erhard summit, in Bavaria on Friday. He said that announcing the end date of QE is justifiable and that full policy normalization would be a long path. He also said that the imminent risk of a change in rates was currently low and that price trends were in line with goals. EURUSD fell from a high of 1.21534 to 1.21216 when the comments were made.

The Baker Hughes US Rig Count number was released with the headline number coming in at 752. The prior number last Friday showed that there were 742 Oil rigs in operation.

EURUSD is up 0.09% overnight, trading around 1.22140.

USDJPY is down -0.15% in early session trading at around 110.830.

GBPUSD is up 0.15% to trade around 1.37481.

USDCAD is down -0.07%, trading around 1.24473.

Gold is up 0.33% in early morning trading at around $1,342.02.

WTI is unchanged this morning, trading around $64.35.

Major data releases for today:

At 07:45 GMT, Eurozone Trade Balance n.s.a. (Nov) will be released. The expected number is €28.2B from €18.9B prior. Eurozone Trade Balance s.a. (Nov) is expected to be €22.3B v €19.0B previously. EUR pairs will be influenced by this data point.

Major data releases for this week:

On Tuesday at 09:30 GMT, UK Consumer Price Index (YoY) (Dec) is expected out at 3.2% v 3.1% previously. GBP crosses could be moved by this and other data released at this time.

On Wednesday at 10:00 GMT, Eurozone Consumer Price Index (YoY) (Dec) will be released. 1.4% is the consensus number from 1.4% previously. Consumer Price Index – Core (YoY) (Dec) is expected to be unchanged at 1.1%.

At 15:00, Bank of Canada will release their Interest Rate Decision and Rate Statement. It is expected that the rate will be 1.12% from 1.00% previously. The Monetary Policy Report will also be released at this time, followed by a Press Conference at 16:15 GMT.

On Thursday at 00:30, Australian Unemployment Rate s.a. (Dec) will be released with the consensus pointing to an unchanged value of 5.4%. Participation Rate (Dec) is expected at 65.4% v 65.5% previously. Employment Change s.a. (Dec) is expected at 24.9K v 61.6K prior.

At 02:00 GMT, Chinese Gross Domestic Product (YoY) (Q4) will be released. The previous number was 6.8%. Chinese Gross Domestic Product (QoQ) (Q4) was 1.7% in Q3.

The GBP/JPY, popular "Dragon" has formed a bearish SHS pattern just below the D L3 resistance. At this point, the price is trying to break 152.00 and reach 151.80-64. If the pattern stays firm, and the price goes below 151.64 then the pair could drop to 151.20. A spike above 152.50 and 153.00 could be next. If the price gets to 152.85-153.00, the chances are that fresh sellers might be waiting to sell the pair again towards 151.50 and above mentioned targets.

W H3 - Weekly Camarilla Pivot (Weekly Interim Resistance)

W H4 - Weekly Camarilla Pivot (Strong Weekly Resistance)

D H4 - Daily Camarilla Pivot (Very Strong Daily Resistance)

D L3 – Daily Camarilla Pivot (Daily Support)

D L4 – Daily H4 Camarilla (Very Strong Daily Support)

POC - Point Of Confluence (The zone where we expect price to react aka entry zone)

Fresh bearish extension on Monday took out key support at 110.83 (27 Nov low) and heading towards next strong supports at 110.15 (Fibo 61.8% of 107.31/114.73 ascend) and psychological 110.00 support. The pair is holding in red for the fifth straight day, with loss of 110.83 pivot generating strong signal of sidelining broader longs. Violation of 110.00 pivot would open way for further bearish acceleration and expose next key points at 109.10 (weekly cloud base), 107.70 (bull-trendline off Sep 2012 low at 77.12) and key med-term support at 107.31 (Sep 2017 trough). Corrective actions could be anticipated in coming session as studies are oversold, but strong bearish sentiment suggests limited upside. Strong resistance at 111.70 zone, provided by weekly cloud top and broken 200SMA, is expected to cap upticks.

Res: 110.83, 111.18, 111.70, 111.96
Sup: 110.50, 110.15, 110.00, 109.10

Cable extended strong advance on Monday and posted new post-Brexit recovery high at 1.3769, approaching psychological 1.3800 barrier and focusing key point at 1.3837 (Fibo 61.8% of post-Brexit vote 1.5016/1.1930 fall).

The pound rides on strong bullish sentiment and seen extending further up on sustained break above 1.3837 and expose psychological 1.4000 barrier.

Fourth straight bullish weekly close last Friday is strong bullish factor which underpins the advance.

Key events for sterling this week are releases of UK inflation (Tuesday) and retail sales (Friday) which are expected to provide strong signals.

Former top at 1.3612 (03 Jan) reinforced by rising daily Tenkan-sen, marks strong support which is expected to hold and keep the downside protected.

Res: 1.3762, 1.3800, 1.3837, 1.3900
Sup: 1.3724, 1.3700, 1.3650, 1.3612

Daily Pivots: (S1) 151.03; (P) 151.84; (R1) 153.21; More...

GBP/JPY drew strong support from 55 day EMA and rebounded. Intraday bias is turned neutral first. On the upside, break of 153.66 will resume medium term up trend. Meanwhile, break of 149.40 support will indicate trend reversal and turn focus to 149.96 for confirmation.

In the bigger picture, considering bearish divergence condition in daily MACD, the steep fall from 153.66 is now seen as first sign of trend reversal. Focus will turn to 146.96 support. Firm break there will at least confirm medium term topping and target 139.39 support next.

Daily Pivots: (S1) 134.28; (P) 134.91; (R1) 136.04; More....

Despite dipping to as low as 133.03, EUR/JPY quickly recovered. Intraday bias is turned neutral first. With 132.04 support intact, outlook stays bullish and further rally is in favor. Break of 136.63 will resume medium term up trend. However, below 133.03 will turn focus to 132.04. Firm break there will indicate medium term reversal.

In the bigger picture, medium term rise from 109.03 (2016 low) is seen as at the same degree as the down trend from 149.76 (2014 high) to 109.03 (2016 low). It should be targeting 141.04/149.76 resistance zone. On the downside, break of 132.04 support is needed to indicate medium term reversal. Otherwise, outlook will stay bullish in case of deep pull back.

Daily Pivots: (S1) 0.8847; (P) 0.8888; (R1) 0.8921; More...

Breach of 0.8923 argues that rebound form 0.8688 could be resuming. But upside momentum remains unconvincing. Break of 0.8981 resistance is needed to indicate completion of the decline from 0.9305. Otherwise, another fall would be mildly in favor. Below 0.8808 support will turn bias to the downside for 0.8688 support first.

In the bigger picture, there are various ways to interpret price actions from 0.9304 high. But after all, firm break of 0.9304/5 is needed to confirm up trend resumption. Otherwise, range trading will continue with risk of deeper fall. And in that case, EUR/GBP could have a retest on 0.8303. But we'd expect strong support from 0.8116 cluster support (50% retracement of 0.6935 to 0.9304 at 0.8120) to contain downside.

Daily Pivots: (S1) 1.5279; (P) 1.5362; (R1) 1.5484; More....

EUR/AUD's strong rebound suggest short term bottoming at 1.5153, on bullish convergence condition in 4 hour MACD. Intraday bias is turned back to the upside for retesting 1.5770 high. On the downside, break of 1.5153 will resume the fall from 1.5770 to 1.4949 cluster support (38.2% retracement of 1.3624 to 1.5770 at 1.4950).

In the bigger picture, decline from 1.5770 just breached 1.5226 key support briefly and recovered. The development is reviving the bullish case that rise from 1.3624 is still in progress. But considering bearish divergence condition in daily MACD, we'd prefer to see firm break of 1.5770 resistance to confirm. On the downside, sustained trading below 55 week EMA (now at 1.4950) will likely bring retest of 1.3624 support. Overall, there is still prospect of another medium term rally as long as 61.8% retracement of 1.1602 to 1.6587 at 1.3506 holds.

Daily Pivots: (S1) 1.1751; (P) 1.1780; (R1) 1.1826; More...

EUR/CHF's rally resumed by taking out 1.1777 and reaches as high as 1.1818 so far. Intraday bias is back on the upside for further rally. At this point, we'd still expect strong resistance below 1.2 handle to limit upside and bring medium term reversal. But break of 1.1683 support is needed to indicate short term topping first. Otherwise, outlook will remain mildly bullish in case of retreat.

In the bigger picture, while a medium term top could be around the corner, there is no change in the larger outlook. That is, long term rise from SNB spike low back in 2015 is still in progress and would extend. As long as 1.1198 resistance turned support holds, we'll hold on to this bullish view and expect another to prior SNB imposed floor at 1.2000. Though, we'll reassess the outlook if 1.1198 is firmly taken out.