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The week started on a rather calm note across US and European equity markets. This is the first Monday since the start of the year that we can say this: equities opened quietly.

The rally in gold and silver stole the spotlight, as gold surged past the $5’000 per ounce level yesterday, and silver above $100. Both gave back gains during the session, but are once again strongly bid in Asian trading.

Part of the move is clearly speculative — there is no doubt about that. Gold’s volatility index spiked to its highest level since 2020, suggesting that a sizeable downside correction is more likely than not in the foreseeable future. But the fundamentals that pushed precious metals to these levels remain very much alive: exploding US debt and a potentially inappropriately dovish Federal Reserve (Fed) policy are making the US dollar increasingly vulnerable to inflation — in other words, to value deterioration. At the same time, US-induced trade and geopolitical tensions threaten the US dollar’s appeal as a reserve currency. Gold has overtaken US Treasuries in global central banks’ FX reserves. Hence, the long-term outlook for gold remains constructive. Historical data suggests that the rally could extend toward $6’500 per ounce.

As for silver, the parabolic rise clearly calls for a sharp correction — there is little doubt about that. Some, however, prefer to look at the chart on a logarithmic scale, arguing that relative value gains matter more than nominal ones. From that perspective, silver’s move — while impressive — remains broadly in line with historical trends. That suggests that once a pullback has run its course, the rally has little reason to stop, especially as the US dollar continues to lose its fundamental appeal.

Turning to the US dollar, it remains under pressure. The Fed starts its two-day policy meeting today. It is not expected to move on rates. Powell is unlikely to say much more than “we are watching the data and it tells us to wait before cutting further.” This lack of action is expected to trigger renewed fury from the White House. We could even hear the announcement of who might take over the Fed in the coming months. The issue is that the Fed still retains credibility under Jerome Powell, precisely because he has resisted political pressure. The day he is gone, that credibility could come into question — and a loss of faith in the Fed would likely be another tailwind for precious metals.

January is almost over, and amid all the focus on geopolitics and Black Swan risks, we nearly forgot to mark the anniversary of DeepSeek’s chatbot, which first emerged in January last year. Around this time last year, the arrival of the Chinese rival revived fears that advanced AI chatbots could be built using earlier-generation Nvidia chips — potentially making them cheaper while remaining highly efficient. US AI stocks dipped on those concerns, while a Chinese AI rally kicked off.

A year later, appetite for US AI exposure has not been materially dented by Chinese competition. Companies that sold off on the initial DeepSeek headlines — such as Nvidia, Alphabet and Microsoft — rebounded quickly and resumed their rally. Meanwhile, DeepSeek marked the beginning of a broader Chinese AI revival. The Hang Seng Index has rallied roughly 78% through 2025, recovering around two thirds of the losses suffered during the 2018–2022 meltdown.

Appetite for global tech — and AI-related stocks — remains strong, but questions arise. China may not yet have fully explored its upside potential. In the US, meanwhile, the rally is increasingly questioned amid concerns over overspending, leverage and the circular nature of AI-related deals.

The circularity of those deals — in simple terms, companies like Nvidia investing in their own customers so they can, in turn, buy Nvidia’s products — appears to irritate investors more than it worries Nvidia itself. On the contrary, Nvidia announced an additional $2 billion investment in CoreWeave to accelerate build-out and AI adoption. CoreWeave initially rallied around 10% at the open before giving back gains, while Nvidia slipped 0.64%, underscoring investor discomfort with circular funding structures. What investors want to see is money flowing into the AI ecosystem from outside — meaning from end users, enterprises and third-party businesses.

I remain confident that AI will ultimately deliver that external demand. The concern is timing: the speed of adoption may not match the speed of investment. By the time demand accelerates, some infrastructure risks becoming obsolete — implying that part of today’s capex could end up wasted. That is what investors will be watching closely in upcoming earnings: whether they stay invested, or cash out.

Returning to Nvidia, the stock also slipped after Microsoft unveiled its second-generation AI chip, which could reduce reliance on Nvidia’s hardware. That is negative for Nvidia, as hyperscalers such as Google, Meta and Amazon are pursuing similar strategies and together account for around half of Nvidia’s customer base. Nvidia, however, is not standing still. In the context of the CoreWeave deal, it announced to offer standalone CPU chips under the Vera brand, targeting a market long dominated by Intel and AMD.

Hence, things are not getting easier for Intel. After plunging 17% following earnings and a warning over manufacturing challenges, the stock fell another 5.7% yesterday on concerns that Nvidia is entering the CPU space. As per Nvidia, while this expansion could open a new revenue stream for Nvidia, competition will be fierce — and margin pressure is likely to follow.

In focus today

• In the US, Conference Board's January consumer confidence survey will be released in the afternoon. University of Michigan's flash survey suggested earlier that consumers have been feeling slightly more optimistic at the beginning of the new year.
• In Hungary, we expect the central bank to keep the policy rate unchanged at 6.50% at today's meeting.

Economic and market news

What happened over night

In South Korea, the ruling Democratic Party announced plans to pass a special act on the US trade deal by the end of February, following President Trump's threat to impose higher tariffs on South Korean exports. In a post on Truth Social, Trump stated that tariffs on South Korean autos, pharmaceuticals, lumber, and 'reciprocal' tariffs would rise to 25% from 15%, blaming the delay in the South Korean legislature's approval of the agreement. Shares of Hyundai and Kia initially dropped sharply but later recovered some of the losses.
What happened yesterday

In Germany, the IFO indicator was slightly disappointing in January. The current situation assessment rose modestly to 85.7 (cons: 86.0, prior: 85.6) while expectations edged lower to 89.5 (cons: 90.3, prior: 89.7). This contrasts with Friday's PMI data, which exceeded forecasts, with the composite index improving to 52.5. Based on a combination of these indicators, we estimate that the German economy maintained its growth momentum of 0.2% q/q from Q4 2025 in January. We expect an acceleration in growth as various tax cuts, increased subsidies, and the rollout of the infrastructure package, effective from 1 January, begin to support economic activity.

In commodities, gold prices reached record highs, surpassing USD 5,100/oz, while silver approached near all-time highs, signalling a strong shift toward safe-haven assets. This trend reflects heightened investor caution amid ongoing geopolitical tensions, a weaker US dollar, and increasing uncertainty around policy direction in major economies, amplified by President Trump's disruptive policy moves at the start of 2026.

In geopolitics, the deployment of a US aircraft carrier strike group closer to Iran signals increased military readiness and heightens the risk of further escalation in the Middle East.

Equities: Global equities were moderately higher on Monday, driven by the US. European markets started the day lower but rose when US markets opened. S&P 500 up 0.5% and Stoxx 600 0.2%. While the start of the year was all about the S&P495, the last trading sessions have seen renewed preference for US big tech. This continued yesterday, with communication and tech among the best performing sectors. Global large caps even beat small caps - for the first time this year, in fact. Positioning ahead of tech earnings starting Wednesday could be one trigger for the recent shift. Another could be the dollar weakening, which continued to slide -0.6%, resulting in preference towards the export-oriented US large caps that gain advantage from FX.

FI and FX: After an initial surge in volatility to start the week, the FX market calmed down a bit yesterday afternoon. EUR/USD briefly tested the waters above 1.19 before settling at high-1.18's. USD/JPY remains under scrutiny and scandies lost some ground as EUR/NOK and EUR/SEK both rose 5-6 figures each. European yields traded lower yesterday, whereas in the US the curve bull-flattened slightly. Trump's latest threats to raise tariffs on South Korea has seemingly only had a limited market impact thus far, and equities remain in green in Asia.

Key takeaways

• Nasdaq 100 breaks higher after weeks of lagging: After underperforming US peers due to sector rotation away from mega-cap tech, the Nasdaq 100 has finally broken out of a 7-week consolidation range, signalling a bullish catch-up phase may be underway.
• Mega-cap earnings are the near-term catalyst: With Microsoft, Meta, Tesla, and Apple reporting Q4 earnings this week, results could jolt the index out of its slumber and validate the recent upside breakout.
• Technical and breadth signals now support the bullish bias: RSI has broken out of a descending trendline, price has cleared key resistance, and market breadth has improved meaningfully, with a growing share of Nasdaq 100 stocks trading above their 20-day and 50-day moving averages.

The mega-cap technology-heavy Nasdaq 00 has lagged its US peers and other major global benchmark stock indices, as it only recorded a meagre year-to-date gain of 1.8% as of Monday, 26 January 2026, underperforming the Dow Jones Industrial Average (+2.8%), and small-cap Russell 2000 (+7.2%), while slightly higher versus the S&P 500 (+1.5%) (see Fig. 1).

Fig. 1: YTD performance of US & global major stock indices as of 26 Jan 2026 (Source: MacroMicro)

The current underperformance of the Nasdaq 100 within the US stock market has been attributed to a sector rotation towards industrials, energy, and basic materials due to geopolitics and the current US White House administration’s expansionary/aggressive foreign policy.

Mega-tech earnings may jolt the Nasdaq 100 up from its slumber

A big earnings week for US mega-cap technology stocks as four of the so-called “Magnificent Seven” will report their respective Q4 2025 earnings results this week.

Microsoft, Meta Platforms, and Tesla will report their earnings results on Wednesday, 28 January, after the close of the US session, followed by Apple on Thursday, 29 January, also after the close of the US session.

Interestingly, technical factors are now indicating that the current laggard Nasdaq 100 is likely to stage a bullish catch-up.

Let’s reveal the relevant charts and the Nasdaq 100 short-term (1-3 days) trajectory

Short-term trend bias (1 to 3 days): Evolving into a bullish trend

Fig. 2: US Nasdaq 100 CFD index minor trend as of 27 Jan 2026 (Source: TradingView)

After a choppy price configuration from 15 January to 21 January 2026, the US Nasdaq 100 CFD Index (a proxy for the Nasdaq 100 E-mini futures) has now evolved into a minor bullish trend, with an intraday bullish breakout above the 7-week range resistance zone at 25,760/25,830.

Watch the 25,500 short-term pivotal support (also the 20-day moving average) to maintain the bullish tone, with the next intermediate resistance coming in at 26,107, followed by the current all-time area of 26,290 in the first step.

On the flip side, a break with an hourly close below 25,500 invalidates the bullish scenario to see another round of choppy minor corrective decline sequence to expose the next intermediate support at 25,350 (also the 50-day moving average). Below it sees further potential weakness towards 25,105/25,030 support next.

Key elements to support the bullish bias

Fig. 3: US Nasdaq 100 CFD index medium-term trend as of 8 Jan 2026 (Source: TradingView)

Fig. 4: % of Nasdaq 100 component stocks above 20-day MA & 50-day MA as of 26 Jan 2026 (Source: TradingView)

• The daily RSI momentum indicator of the US Nasdaq 100 CFD index has staged a bullish breakout above a key parallel descending trendline, which increases the odds of a price action bullish breakout from the 7-week range resistance of 23,830 (Fig. 3).
• Market breadth has improved considerably. Over the past month, the percentage of Nasdaq 100 component stocks that are trading above their respective 20-day moving averages has increased significantly from 33% on 31 December 2025 to 53% as of Monday, 26 January 2026. Similarly, the percentage of Nasdaq 100 component stocks that are trading above their respective 50-day moving averages jumped by 10 percentage points to 57% over the same period (Fig. 4).

The Dollar has taken quite a significant hit after its strong start to 2026.

This is precisely what happens when technicals align with changing fundamentals. As noted in our pre-Greenland chaos Analysis, the Dollar Index was already showing signs of imminent technical weakness.

So when Donald Trump decided not only to launch an investigation into Jerome Powell but also to threaten his historic allies, what was seen as a slow, progressive dedollarization quickly became a catastrophe for the US Dollar.

Some European funds are selling their Dollar-denominated debt assets in concern over new, aggressive policies from the current administration and, by actively seeking alternatives, reducing dollar demand – this is leading, in part, to the current decline.

Combined with a seasonal tendency for the US Dollar to drop ahead of interest rate decisions during cutting cycles, the weekly drop is getting extreme – fewer participants can absorb sudden outflows ahead of FOMC Meetings for risk-management reasons, amplifying such moves.

This dedollarization explains the ongoing run in Gold (which just hit $5,000 today) and other metals – The Debasement Trade for those unfamiliar with the trending financial term.

US Dollar Performance against other FX Majors since last Thursday – Source: TradingView

Looking back at the September cut, for example, the Dollar Index had reached 2025 yearly lows, a fast-paced selloff just two days ahead of the Rate Decision.

The current situation shows similar conditions, despite no rate cuts anticipated – What interests traders is whether the selloff will continue after the FOMC.

For additional foundational context, I strongly encourage you to explore our FOMC Preview.

With the Fed Funds rate expected to be kept unchanged, investors and institutions will be listening closely to Powell's speech.

A bit less than two rate cuts are currently priced for 2026. With labor conditions seemingly worsening only slightly and inflation remaining closer to 3% than 2% (despite some improvements), the Fed Chair doesn't have many reasons to turn dovish, but the current pricing is still reasonable.

Essentially, the more resilient US economy supports the Dollar and could lead to sudden inflows back into the Greenback after the meeting.

The difference maker will be found in unpredictable events:

• The nomination of the next Fed Chair could have a significant influence on the Dollar demand (particularly if Rick Rieder gets selected)
• If Trump moves to intervene in Iran, the Dollar should appreciate suddenly in pro-dollar risk-averse Market conditions – Kind of similar to what happened after Venezuela.
• If Trump actually pushes his intense rhetoric further with allies, however, the Dollar outflows will be severe – you would see the results in the Dollar Index flashing below 2025 lows.
• The FOMC event itself could support the USD but would depend on Powell's tone regarding his 2026 outlook.

While we're here, let's see what the charts say in our multi-timeframe analysis of the US Dollar Index (DXY) to see if there is still much left in the ongoing down move.

Dollar Index (DXY) Multi-Timeframe Analysis

Daily Chart

Dollar Index (DXY) Daily Chart. January 26, 2026 – Source: TradingView

The Technical picture changed suddenly over the past week.

Bulls were taking the Index back towards the 99.50 level but with some short-timeframe resistances, bear divergences combined with Trump actually pushing the Greenland theme, the fused technicals and fundamentals had an immediate effect on the DXY, down 2.50% until today.

Last week led to a huge gap lower today, with the pre-FOMC position closing effect pushing the Index to test the 96.50 to 97.00 Support.

Whether it holds or breaks in the next 1.5 sessions doesn't matter much; the most important will be to see if the Dollar remains above or below after the FOMC.

• Closing above 97.00 should lead to a slow but consistent rebound back towards 99.00
• Below however opens the door to test the 2025 lows
  • These scenarios are not considering any black swan events.

4H Chart and Technical Levels

Dollar Index (DXY) 4H Chart. January 26, 2026 – Source: TradingView

Looking closer, the question remains whether the gap is an exhaustion/low volume gap (implying that an extreme is reached) or whether this is an actual runaway gap (meaning further downside).

To help tilt the scales, it is essential to track the path of least resistance.

With the 4H RSI in extreme oversold territory and a key support coming into effect, a rebound makes sense. The question is when.

Keep in mind that the buying could still not be so sudden as traders remain on the sidelines ahead of the key risk-events coming – Think of how such views could be expressed in different FX pairs.

Levels to place on your DXY charts:

Resistance Levels

• August Range Bull/Bear Pivot 97.25 to 97.60
• 98.00 Main Support turned Minor Resistance
• Higher timeframe Pivotal Resistance 98.80 to 99.00
• 99.40 to 99.50 January Resistance (last Friday levels)
• 100.376 November highs

Support Levels

• 2025 Lows Major support 96.50 to 97.00
• Session lows 96.80
• September FOMC Lows 96.20
• Early 2022 Consolidation just below 96.00
• 95.00 Main psychologic support

1H Chart

Dollar Index (DXY) 1H Chart. January 26, 2026 – Source: TradingView

Looking closer, one things looks clear – The downside is stalling after a brutal descent.

But a slowdown in a downtrend doesn't imply an imminent rebound, buyers will first have to show up.

With the selloff stalling at the descending channel lows, imminent downside keeps a lower probability setup.

Hence from here, a consolidation range until the FOMC between 96.80 and 97.30 is highly probable.

After the FOMC however, the rest will be to see if bulls show up for an upside breakout (to a least test the upper bound of the channel ~98.20).

In case they don't, the selloff may continue.

Safe Trades!

Key Highlights

• GBP/USD gained bullish momentum for a move toward 1.3700.
• Bitcoin dipped below $88,000 and $87,000 before it found some support.
• USD/JPY nosedived below the key support at 155.50.
• Gold extended its surge to a new record high above $5,100.

GBP/USD Technical Analysis

The British Pound remained stable above 1.3450 against the US Dollar. GBP/USD started a strong increase above 1.3500 and 1.3550.

Looking at the 4-hour chart, the pair cleared many such as a bearish trend line, the 200 simple moving average (green, 4-hour), and the 100 simple moving average (red, 4-hour). The bulls even pumped the pair above 1.3620.

A high was formed at 1.3682, and the pair is now consolidating gains. Immediate resistance sits near 1.3680. The first key hurdle could be 1.3720. A close above 1.3720 could open the doors for a move toward 1.3800. Any more gains could set the pace for a steady increase toward 1.3880.

If there is no move above 1.3720, there could be a pullback. On the downside, immediate support is near the 1.3600 level. The first major area for the bulls might be near 1.3550.

The main support sits at 1.3520 and 1.3500, below which the pair could accelerate lower. The next support could be 1.3460 and the 100 simple moving average (red, 4-hour). Any more losses might call for a test of 1.3400.

Looking at Gold, the bulls remained in action and were able to pump the price to a new milestone record high above $5,100.

Upcoming Key Economic Events:

• US Housing Price Index for Nov 2025 (MoM) - Forecast +0.3%, versus +0.4% previous.
• ECB's Nagel speech.
• ECB's President Lagarde speech.

EURUSD has resumed its advance within an impulsive Elliott Wave structure, reinforcing the bullish outlook. The cycle from the November 5, 2025 low is unfolding as a clear five‑wave sequence. Wave 1 concluded at 1.1808, establishing the initial leg of the rally. The subsequent pullback in wave 2 developed as a double three corrective formation, reflecting typical Elliott Wave behavior in consolidations.

From the peak of wave 1, wave ((w)) ended at 1.1659, followed by a corrective rally in wave ((x)) that terminated at 1.1742. The final leg of the correction, wave ((y)), pushed lower and ended at 1.1575. This completed wave 2 at a higher degree and set the stage for renewed upside momentum. Since then, the pair has resumed higher in wave 3, confirming the impulsive structure.

Advancing from wave 2, wave ((i)) ended at 1.1768, while the subsequent dip in wave ((ii)) found support at 1.167. Current price action suggests that wave ((iii)) is approaching completion. Once it concludes, a pullback in wave ((iv)) should follow before the pair continues higher in wave ((v)). In the near term, as long as the pivot at 1.1575 remains intact, dips are expected to find support. These retracements should unfold in 3, 7, or 11 swings, providing opportunities for further upside continuation within the broader impulsive cycle.

EURUSD 60 minute chart

EURUSD Elliott Wave video:

https://www.youtube.com/watch?v=gc5VPCloFvs

USDCHF has provided traders with a textbook example of how Fibonacci extension zones can act as powerful resistance. After an extended move higher, price reached the 0.8020–0.8092 extension area, where sellers decisively stepped in. The rejection at this zone not only halted the advance but triggered a fresh wave of decline, reinforcing the importance of monitoring these levels for potential reversals. For traders, this setup highlights how extension zones can sharpen risk management, offer clear invalidation points, and reveal where market sentiment shifts from bullish exhaustion to renewed bearish momentum. The following charts illustrate how price action unfolded around the Fibonacci extension zone, highlighting the rejection and subsequent decline.

USDCHF 4‑Hour Chart (Jan 18): Sellers Emerged at 0.8020–0.8092, Rejecting Resistance and Driving Price Lower

The decline in USDCHF from the November 5 peak unfolded in three waves, suggesting that subsequent bounces were likely to fail in either 3, 7, or 11 swings for an extension lower as far as November 25 high remained intacct. The 4‑hour chart from January 18 captures the advance from the December 25 low, which developed in seven swings and was expected to terminate between 0.8020–0.8092 before the downtrend resumed. The 0.81018 level serves as the key invalidation point—holding below this resistance keeps the bearish view intact and reinforces the expectation of further decline.

USDCHF 4‑Hour Chart (Jan 26): Sellers defended 0.8020–0.8092, breaking September 17 low and driving wave ((iii)) lower.

USDCHF Jan 26 4 Hour Elliott Wave ChartUSDCHF found sellers in the 0.8020–0.8092 Fibonacci extension area and resumed its decline. Price has already broken below the September 17 low and is currently unfolding wave ((iii)) of 3 down from the November 5 peak. The pair has reached the 100% Fibonacci extension of wave ((i)) relative to wave ((ii)), but ideally should extend toward 0.7625, which represents the 161.8% extension—a typical level for wave ((iii)) to complete. In the near term, any corrective bounces are expected to fail in 3, 7, or 11 swings, offering traders short‑term selling opportunities for further downside.

The rejection at the 0.8020–0.8092 zone and the unfolding wave ((iii)) decline highlight how Fibonacci extensions and Elliott Wave structures can provide traders with a clear technical roadmap. Staying ahead of these setups requires timely analysis and disciplined execution. By joining our services, traders gain access to real‑time charts, actionable forecasts, and educational insights designed to sharpen decision‑making and keep them ahead of the crowd. If you want to consistently spot opportunities like this USDCHF setup and Blue Box Trade Setups before the market reacts, our community and resources are built to guide you every step of the way!

Natural Gas has once again reminded traders of its explosive potential. After finding buyers at a key Fibonacci extension area, prices catapulted 146% in just 12 trading days—an extraordinary rally that left skeptics behind and rewarded those who trusted the technical confluence. This surge wasn’t just about numbers on a chart; it was a vivid demonstration of how market psychology, technical precision, and momentum can align to produce breathtaking moves. For traders and analysts alike, the rally offers a textbook case study in how Fibonacci levels can act as springboards for powerful trends. Charts often speak louder than words, so let’s turn to the charts to see how this remarkable move unfolded…

Natural Gas Daily Chart (Jan 14): Price approaches the 3.022 – 1.965 Fibonacci extension zone

Natural Gas 11 Jan Daily Elliott Wave ChartOn the daily chart from January 11, Natural Gas was approaching the 3.022 – 1.965 blue box zone—a critical Fibonacci extension area we had been watching closely. This region carried the potential to attract buyers and set the stage for the next leg of the rally. Going to a smaller time frame, within wave (( C )), we saw wave (3) unfolded shorter than wave (1). This gave us a precise invalidation level for wave (5) of ((C)) at 3.008. A break below that level would have opened the door for a deeper pullback toward the 2.620 – 1.965 area. However, buyers stepped in just before this threshold was tested, defending the structure and reigniting the rally.

Natural Gas Daily Chart (Jan 26): Fibonacci extension zone drives a powerful 146% rally in 12 days

“Daily chart from January 26 above captures the explosive rally that followed. After price respected the Blue box zone, buyers stepped in with conviction, driving Natural Gas sharply higher reaching a high of $7.439. The move unfolded with textbook momentum, surging 146% in less than two weeks and confirming the strength of the technical setup. The Natural Gas rally underscores a simple truth: Blue box zones mark decisive turning points. Recognizing these areas early can sharpen your edge, helping you anticipate momentum shifts and position yourselves in the market with confidence.

EURCHF: ⬆️ Buy

• EURCHF reversed from support zone
• Likely to rise to resistance level 0.9260

EURCHF currency pair recently reversed up from the strong support area between the support levels 0.9195 and 0.9215 (which has been reversing the price from the end of 2024) and the lower daily Bollinger Band.

The upward reversal from this support zone stopped the previous minor impulse wave iii from the start of January.

Given the strength of the aforementioned support area and the bullish divergence on the daily Stochastic, EURCHF currency pair can be expected to rise to the next resistance level 0.9260 (former monthly low from December).