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NZDCAD: ⬆️ Buy

• NZDCAD reversed from support zone
•  Likely to rise to resistance level 0.8025

NZDCAD cryptocurrency recently reversed from the support zone between the long-term support level 0.7850 (which has been reversing the price from April) and the lower daily Bollinger Band.

The upward reversal from this support zone formed the daily Japanese candlesticks reversal pattern Morning Star – which started the active impulse wave 1.

Having just broken the daily down channel from December, NZDCAD cryptocurrency can be expected to rise to the next resistance level 0.8025.

Bitcoin: ⬇️ Sell

• Bitcoin reversed from resistance zone
• Likely to fall to support level 87330.00

Bitcoin cryptocurrency recently reversed from the resistance zone between the strong resistance level 93285,00 (which has been reversing the price from November), upper daily Bollinger Band and the 50% Fibonacci correction of the downward impulse from November.

The downward reversal from this resistance zone will likely form the daily Evening Star – strong sell signal for Bitcoin.

Given the strong daily downtrend and the overbought daily Stochastic, Bitcoin cryptocurrency can be expected to fall to the next support level 87330.00 (low of waves ii and ii).

EURGBP: ⬆️ Buy

• EURGBP reversed from support zone
• Likely to rise to resistance level 0.8725

EURGBP currency pair recently reversed from the support zone between the support level 0.8660 (former strong support from October), lower daily Bollinger Band and the 382% Fibonacci correction of the upward impulse from May.

The upward reversal from this support zone stopped the previous minor impulse wave 3 of the (C)-wave from December.

Given the strong daily uptrend and the oversold daily Stochastic, EURGBP can be expected to rise to the next resistance level 0.8725 (former support from December).

Brent Crude Oil: ⬇️ Sell

• Brent Crude Oil reversed from resistance zone
• Likely to fall to support level 58.40

Brent Crude Oil recently reversed down from the resistance zone between the key resistance level 62.00 (former support from November) and the 50% Fibonacci correction of the downward impulse from October.

This resistance zone was further strengthened by the 2 downward sloping intersecting trendlines from September and June.

Given the clear daily downtrend, Brent Crude Oil can be expected to fall to the next support level 58.40 (which has been revering the price from April).

After an initial inverse reaction—rising at the weekly open following the capture of Venezuela's Nicolas Maduro—WTI oil prices are now correcting.

The initial spike was fascinating, offering a potential blueprint for what we might expect in the event of a future Russia-Ukraine peace agreement. But why did oil go up on news that logically opens the door to more supply?

It is the effect of an inverted "Buy the Rumor, Sell the News."

Sanctioned nations like Russia and Venezuela have been forced to supply the market at deep discounts—recently reported as much as $20 below spot prices—to bypass restrictions.

Discounts in the Oil Market – X Post from Javier Blas

When such nations regain official access to traditional markets, their competitive black market offers disappear.

This effectively removes the "cheapest" barrels from the shadow market, creating a temporary perception of tightening or, at the very least, a volatility premium. – This argument is on the backline of why Oil has been going down ever since the beginning of the Ukraine-Russia conflict and could reverse at the resolution.

The same logic applies to Iran, which is currently undergoing what resembles the beginning of a revolution.

The anti-West axis (Iran, Venezuela, Russia) has historically created a drag on oil prices by flooding the market to fund their regimes, even with restricted access. This is the "Sanctions Paradox," which I gladly invite you all to read more about.

In any case, the test of $59 was short-lived.

Sellers came right back into action to mean-revert the rebound. While higher supply from a reopened Venezuela will eventually offer stiff competition to Canadian heavy crude, this infrastructure ramp-up will take time to materialize.

Consequently, the current pullback is likely explained by the dissipation of that initial geopolitical volatility premium.

But do sellers have enough momentum to push prices to fresh lows? It's possible, but there are structural elements pointing against it.

Let's dive right into a multi-timeframe analysis of WTI Oil to see why.

US Oil Intraday Timeframe Analysis

WTI 4H Chart and Technical Levels

WTI Oil 4H Chart – January 7, 2026. Source: TradingView

Looking at the ongoing price action, the swift selloff has seen mean-reversion buying at the $56.50 Support.

When price action sees such sudden up and down reversals, it tends to offer strong rangebound setups for buy low, sell high setups.

Still, retesting and breaking today's lows at $55.82 would reject this hypothesis.

When traders are lost and looking for direction, ranges have high chance of forming. This takes even more ground when Moving Averages are flattening like on this chart.

Look for buying at support ($56.40 to $56.50) and profit-taking/selling between $58 to $59.

WTI Technical Levels

Levels to place on your WTI charts:

Resistance Levels

• $57 to $58.00 Major Pivot
• $58.17 4H 200-MA
• $59 to $60 2021 Resistance and Channel Highs
• Minor Resistance $62 to $63
• Key September Resistance $65 to $66

Support Levels

• $56.38 Weekly Open gap down
• $55.83 Session Lows
• $55 to $56.50 2025 Support and Channel lows
• 2019 mini support $53 to $54
• Mid-2019 Main support $51 to $52.50

30M Chart and Trading Setups

WTI Oil 30M Chart – January 7, 2026. Source: TradingView

After the bouts of volatility from this morning, the action is calming down on shorter timeframes.

Sellers are seeing some exhaustion at the session lows (coinciding with the 2025 lows support) – Still, the buying is timid and seeing rejection at the 30M 50-period MA.

For the rangebound setup, traders can look at a break above the 50 MA to get confirmation with a potential stop below the session lows or 2025 lows for more conservative positions.

Safe Trades and a Successful 2026!

Ever since correcting from its 100.00 peak in mid-November, the US Dollar has been locked in a volatile, multi-directional chop.

After a rough ride throughout 2025—particularly the first half—the Greenback has struggled to find conviction in either direction.

A 10% correction in the world's primary reserve currency was never likely to be a straight line to new decade lows.

While dedollarization was the prominent narrative of last year, reality is setting in.

With the US economy still outperforming its peers, American firms dominating global equities, and the Fed remaining persistently reluctant to cut rates, participants are realizing that divorcing the Greenback is easier said than done.

As we suggested around mid-October, the sharp correction from 110.00 to 97.00 on the Dollar Index was indeed followed by a period of consolidation, with price action settling closer to the current 98.00 to 100.00 range.

US Dollar Performance against other FX Majors in 2025 – Source: TradingView

Following the capture of Maduro and this week's explosive market open, the USD initially gave up some of its late-December rebound as global assets, particularly Stocks went ballistic.

However, a quintessential theme for FX and global trading appears to be developing: the return of "US Freedom" could trigger a fresh wave of demand for the reserve currency.

Between economic resilience and the projection of military strength to protect political interests, the US reasserting itself on the global stage is being perceived positively by traders.

We will now dive into a multi-timeframe analysis of the US Dollar Index (DXY) to decipher what the price action is hinting at and what we can expect in 2026.

Dollar Index (DXY) Multi-Timeframe Analysis

Daily Chart

DXY Daily Chart. January 7, 2026 – Source: TradingView

The US Dollar has held its 97.00 to 100.00 range almost to the T.

What was perceived as surprising strength throughout October, as the Dollar was strengthening during the shutdown, was just mean-reversion move from a support bounce.

So what about now? The latest daily correction phase between 100.40 (Nov Highs) to the ~98.00 Handle marks a continued backlog to dollar demand.

The idea here is that with Dollar sellers failing to push the Index to its Range lows (96.00 to 97.00 Support Zone), some underlying strength is assisting the Dollar, hinting at higher chance of an upside breakout.

Still, some factors could imminently influence the Dollar so keep an eye on reactions to:

• Further menaces to other countries: An Iran intervention would be bullish for the USD while invading Greenland could lead to a major selloff.
• The Supreme Court rejecting tariffs would be a positive for the USD but may be a non-event if the Trump Administration continues
• If the Labor picture suddenly degrades and/or inflation confirms to be soft, more downside can largely be expected. More on this on Friday morning (8:30 – NFP report)

4H Chart and Technical Levels

DXY 4H Chart. January 7, 2026 – Source: TradingView

Looking closer to the intraday timeframe, bulls are grabbing the advantage by holding strong demand at the upward trendline.

Having broken the downward channel, higher action could make further sense.

Still, failing to breach Monday highs at 98.85 should lead to rangebound action

Levels to place on your DXY charts:

Resistance Levels

• 98.50 to 98.80 Intraday Pivot Zone
• 98.82 (200-4H Moving Average)
• Pivot turned Resistance 99.25 to 99.50
• 100.00 to 100.50 Main resistance zone
• 100.376 November highs

Support Levels

• 98.00 Key support (+/- 100 pips) – Recent rebound
• December Lows 97.75
• 97.40 to 97.80 August Range Support
• Mini-support 98.50
• 2025 Lows 96.40 to 96.80 Support

1H Chart

DXY 1H Chart. January 7, 2026 – Source: TradingView

The 1H Timeframe confirms the bullish action as buyers have breached both the 50 and 200-Hour Moving Averages, now acting as support.

Breaking the Monday highs at 98.85 would then not see much resistance until 99.30 to 99.50 – In this scenario, look for USD selling FX positions.

On the other hand, rejecting the Monday highs could trigger nice rangebound conditions in EUR/USD or USD/JPY. As bulls are leading an ongoing buying attempt, keep a close eye to the reactions.

Safe Trades and Happy New Year!

On January 3rd, the U.S. captured Venezuelan President Nicolás Maduro, expanding its economic influence particularly in Venezuela's oil sector.

On January 6th, President Donald Trump announced that Venezuela's interim authorities will turn over 30-50 million barrels of sanctioned oil worth US$2.00–2.75 billion at current market pricing. The mechanisms for (and timing of) delivery are still unclear, though Trump has stated that the oil will be shipped by storage vessels directly to U.S. unloading docks.

Oil markets have reacted slightly bearishly to this week's developments, with WTI oil prices down around 1.5% to just under $57/bbl. This is likely temporary on fears that Venezuelan oil will add to an already-oversupplied market.

We are leaving our WTI oil price forecast unchanged at $58/barrel for Q1 2026. While it is not our base case, Canadian Western Canada Select (WCS) prices may face downward pressure if Venezuelan sanctions are relaxed and demand for Canadian oil decreases. This scenario could increase the WCS discount to WTI by $2-3 per barrel, potentially reversing the positive effects from the Transmountain Pipeline Expansion, which had helped compress the spread over the past year.

The Numbers in Context

The current global oil surplus is estimated at 2-2.5 million barrels per day (bpd). Economically, this one-off oil flow of 30-50 million barrels would not materially impact market balances.

These barrels represent about 30 to 50 days of Venezuela's current oil production, which is around 1 million/bpd. Due to sanctions, underinvestment, and outdated infrastructure, Venezuela produces far less than its historical highs of 3-3.5 million/bpd. Increasing output would require several years and billions of dollars in investment.

With nearly 20 million/bpd consumed in the U.S., this new oil supply represents approximately two and a half days of national usage.

Does This Have an Impact on Canada?

In the near-term, this is likely a low-impact event for Canada.

• Any imports of Venezuelan oil to the U.S. would compete directly with Canadian crude in the U.S. Gulf Coast market, which currently receives only 10% (~400k/bpd) of total Canadian shipments to the U.S.
• A more probable outcome is that only a limited portion of Canadian oil would be substituted, with relatively modest impacts on the national economy.  Alberta could experience more significant effects, but only in the event of a complete near-term and sustained transition to Venezuelan oil in the Gulf Coast.

Total Canadian crude exports to the United States are around four times greater than Venezuelan exports, with ~70% of that consumed in the U.S. Midwest. The U.S. Midwest (PADD II) imports almost exclusively from Canadian sources due to existing pipeline infrastructure. For Venezuelan crude to reach the Midwest, extensive modifications to pipelines would be required to enable south-to-north flow—a process that presently does not make much economic sense and that would require significant time to implement.

Longer-term, significant U.S. investment would be needed to boost oil output and increase pipeline capacity in Venezuela. This strengthens the case for Canada to expedite a new oil pipeline that builds out capacity for Asian shipments. China, the number one buyer of Venezuelan crude, may need to strategically reorient their import sources, further buoying the case for Canada to diversify its energy trade.

The ISM Services index improved in December, increasing from 52.6 to 54.4 in November. This is the third consecutive month of expansion. However, the number of industries reporting growth last month dropped by one to 11 out of 18.

The supplies delivery index showed slower performance in December, but remained in expansionary territory for the 13th consecutive month. While it fell 2.3 points to 51.8, a reading above 50 still indicates slower deliveries which would be expected if customer demand is increasing.

The New Orders and New Export Orders indexes both registered large increases, pointing to decent demand conditions. New orders increased to 57.9 from 52.9 and new export orders increased to 54.2 from 48.7 in the month prior.

The prices index declined slightly by 1.1 points to 64.3, indicating that price pressures are still prevalent. The employment index jumped into expansionary territory, increasing to 52.0 from 48.9.

Key Implications

Overall, this report suggests that demand conditions are in decent shape in the service sector. The employment sub-index jumping into expansionary territory is a marked improved from earlier this year – it had fallen to 47.2 in September when concerns about labour market weakness were top of mind. But this is only a soft signal and not one that will receive much weight, given that payrolls data out on Friday will give a clearer indication of the recent trend in the labour market.

Despite generally positive developments in this report, respondents point to several factors that continue to weigh on business and keep us from being too upbeat about this report. Respondents in several industries report higher prices and input costs, and some also report still feeling some drag from the government shutdown. Uncertainty about trade policy and its impact on inflation remains a going concern for businesses in the service sector.

Bitcoin remains in red for the second straight day and follows weakness in most of safe havens on Wednesday.

Fresh weakness emerged after repeated failure at strong resistance at 94000 (50% retracement of 107502/80514 / short-term range top), where several attacks have been capped recently, with Tuesday’s Hanging man candle, seen as negative signal.

Bears pressure immediate support at 90820 (broken Fibo 38.2% / daily Tenkan-sen) with other nearby significant levels at 90000 (psychological) and 89580 (daily cloud base / daily Kijun-sen) being also exposed.

Fading bullish momentum and south-heading daily RSI (also broke below its 7-d MA) generate negative signals, which could be partially countered by converged 10/55DMAs, on track to form a bull cross.

Near term action still holds in the upper part of the recent six-week range that keeps slight bullish bias, but loss of 90000/89500 zone would weaken the structure and risk deeper drop.

Overall, short term action remains within the range and violation of either range boundary to generate stronger direction signal.

Res: 92050; 92340; 93150; 94000
Sup: 90823; 90000; 89580; 88725

Markets

(European) yields are extending a corrective decline that (re)accelerated at the start of the year. EMU short-term rates touched the highest levels since March early December, after comments from ECB’s Schnabel made markets fully embracing the idea that the case for further easing had become extremely thin. The debate even tentatively turned toward the timing of a potential first rate hike. For long-term yields, this upward momentum stretched further into December as markets understood that fiscal policy/deficit spending would have to do the heavy lifting as Germany/Europe has to address structural reforms and modernize its military capacities. However, the move ran into resistance in the final days of last year. Technical considerations and mild EMU data now even provide the perfect excuse to reduce bond short positions. Today’s EMU January inflation data perfectly fitted this pattern. EMU headline inflation at 2% J/J (0.2% M/M) returned to the ECB target. Core inflation softened slightly more than expected to 2.3% Y/Y (from 2.4%). Favorable energy base effects also are boding well for more sub-target EMU inflation data in the early months of 2026. Ongoing sticky services inflation (0.7% M/M and 3.4% Y/Y) in this mindset was easily put aside. We don’t see any reason for the ECB to change its firm wait-and-see stance due to this ‘technically-inspired’ inflation pattern. Even so, EMU swap yields are declining between 1.7 bps (2-y) and 4 bps (30-y). It’s too early to elaborate on the timing of a potential first rate hike. Joining this momentum trade, UK bonds even outperformed core EMU bonds with yields easing between 1.5 bps (2-y) and 7 bps (30-y). US yields initially followed this trend from some distance as investors awaited a set of US data that had/still has potential to amend expectations on the timing of further Fed easing. ADP reported December private job growth at a slightly softer than expected 41k. JOLTS (job openings) data and the US Services ISM still will be published after finishing this report. US yields currently are converging toward the EU pattern, declining between 1.5 bps (2-y) and 5 bps (30-y). The overall more benign mood on inflation probably is also supported by weak oil prices with Brent oil holding near $ 60 p/b. Equities are taking a breather after a solid start of the year (Eurostoxx 50 -0.1%, S&P 500 +0.1% still testing the all-time record).

On FX, moves in the major USD-cross rates are limited. The dollar basically holds its recent ‘gains’. DXY is changing hands near to 98.55. EUR/USD us going nowhere at 1.169. The yen for now hardly suffers from the rising tensions between Japan and China (USD/JPY 156.45). Sterling enters calmer waters after a strong start to the new year (EUR/GBP 0.8665).

News & Views

Czech inflation dropped a more than expected 0.3% m/m in December, keeping the annual figure at 2.1% instead of the anticipated uptick to 2.3%. Sharply declining food prices (-1.2% m/m) together with easing energy prices (-0.6% m/m, -4.2% y/y) explain most of the surprise CPI drop. They offset amongst others accelerating services inflation (0.2% m/m, 4.8% y/y). The December CPI outcome fell short of the central bank’s 2.3% expectation and as such remains close to the 2% midpoint target (+/- 1 ppt tolerance range). In the coming months inflation is likely to drop below 2% due to base effects and lower electricity prices (waiver of renewable energy surcharge). That could fuel speculation for a resumption of the rate cutting cycle, in particular because the CNB adopted a less hawkish tone at the latest policy meeting. The jury remains out on the matter because core inflation (services in particular) gauges appear more stubborn. In any case, after today’s inflation numbers and since the CNB December meeting, bets for a 2026 rate hike earlier last year now seem totally premature and made way for speculation on a tentative cut. The Czech crown lost ground, pushing EUR/CZK from 24.17 to 24.30.

Hungary’s debt management agency (AKK) kickstarted its 2026 financing plan today with a dual tranche EUR benchmark deal. The syndicated launch consists of a 7-yr regular bond and a 12-yr green bond, yet to be priced and determined in size. AKK’s in its 2026 funding plan has penciled in a total HUF 5445 bn net issuance, dropping from HUF 6258 bn in 2025. FX denominated net issuance is planned at HUF 2541 bn, with the bulk carried by FX bonds (HUF 1482 bn) and loans from the EU’s SAFE facility (HUF 781 bn). Its share relative to total debt should stay around the optimally deemed 30% by end-2026. A newly introduced +/- 3%pt tolerance band allows for some flexibility.