EUR/USD

EUR/USD

The EUR/USD pair has been declining in 2019 and appears to have bottomed at 1.0878. The pair is likely to continue moving upwards in 2020 for four reasons. First, there are signs that the European economy has bottomed as evidenced by recent PMI data. Second, the Fed has signalled that it won’t hike rates in 2020. The dovish statement could push the USD lower. Third, the win by Boris Johnson could normalize relations between the European Union and the United Kingdom. Finally, the US election could weigh on the US dollar. Therefore, the pair could reach 1.1300 by June 2020 and 1.1400 by December 2020. The two are important psychological levels. They are also important resistance levels on the daily chart.

 

GBP/USD

GBP/USD

The GBP/USD pair rose sharply as Boris Johnson’s party won a commanding lead. The pair has been declining since 2015 when it reached a high of 1.7223. There are three reasons why the pair could continue to soar in 2020. First, the US election and the Fed commitmentto maintain interest rates could weigh on the US dollar. Second, Boris Johnson’s win could bring back investor and corporate confidence to the UK. Third, after pausing on rate hikes, the BoE could implement one or two hikes in 2020. This will likely push the GBP/USD higher. The pair could test the important support of 1.4317 by June. This is also the 50% Fibonacci Retracement level on the weekly chart. It could reach the 61.8% Fibonacci level of 1.5000 by December.

 

USD/JPY

USD/JPY

The USD/JPY pair has been forming a descending triangle pattern on the weekly chart. The support of this pattern has been the 104.40. In 2020, there will be several things to watch. First, Japan and South Korea could attempt to iron out their trade conflict. Second, the North Korea crisis could escalate. This is often a bullish factor for the yen. Third, a trade deal between the US and China will be a good thing for Japan. This is because Japan is an export-oriented country. Third, the BOJ could signal that it may abandon negative rates in 2021. In June, there is a likelihood that the pair will test the important resistance level of 112, which is also the 50% Fibonacci Retracement level. It may also move lower to test the above-mentioned support of 104.40 by December.

 

AUD/USD

AUD/USD

The AUD/USD pair has been on a downward trend after forming a double top pattern between September and December 2017. The pair had a double bottom between August and September 2019. In 2020, the pair could see some recovery. The key catalyst will be a potential deal between China and the US. China matters because it is the biggest importer of Australian goods. Another catalyst is likely to be a dovish Fed. Meanwhile, recent RBA statements have been relatively positive. The pair could reach 0.7200, which is the 38.2% Fibonacci Retracement level, and by December It could reach 0.7400, the 50% Fibonacci level.

 

USD/CAD

USD/CAD

The USD/CAD reached a low of 1.3015 in July 2017. This was the lowest level since October 2018. The highest level for the pair in 2019 was 1.3570. There will be several catalysts for the pair in 2020. First, the USMCA, which was negotiated between the United States, Canada, and Mexico. The US side has already reached a deal in support of the deal. This means that the USMCA could be ratified in the coming year. Another catalyst could be central banks. The Fed has pointed that it won’t hike rates in 2020. The BoC, which was relatively passive in 2019, could also hike at least once in 2020. The pair may drop to 1.3015, which is an important support level by June. The pair may also move upwards to the 50% Fibonacci Retracement level of 1.3340 by year end.

 

BTC/USD

BTC/USD

The BTC/USD pair soared from a low of 3147 to a high of 13849 in 2019. The pair then moved lower to a low of 6534, and is now trading at the 38.2% Fibonacci Retracement level. There is a likelihood that the pair will soar in the first half of the year. The main catalyst for this will be halving, which will happen in June. This could push the BTC/USD pair higher. A weaker dollar could also help BTC rise. The pair could retest the 2019 high of 13849 in June. It will then likely drop as the markets sell on the news. This could see it end the year at the current level of 7200.

 

XAU/USD

XAU/USD

The XAU/USD pair has been on an upward trend since October 2015, where it had reached a low of 1046. The pair hit a high of 1556 in 2019. In 2020, the pair will be affected by several factors. First, the dovish Federal Reserve could lead to a weaker dollar and a higher gold price. Second, the uncertainties of the upcoming US election could see gold price move higher. Third, weak corporate earnings from the US could raise the likelihood of a corporate recession. This tends to be positive for gold price. On the other hand, a trade deal between the US and China would be negative for gold. The potential scenario is where the XAU/USD pair retests the 38.2% Fibonacci Retracement level of 1360 by June. It could then end the year at 1500.

 

WTI

WTI

The XTI/USD pair formed a triple bottom level at 50.43 in 2019. The three levels were reached in June, August, and September. The price of crude oil will be driven by several factors in 2020. First, a trade deal between the US and China would be positive for crude oil as it would imply more demand. Second, the decision by OPEC+ to slash oil production could also lead to higher prices. These cuts will run until March. Third, non-OPEC oil production could weigh down on oil prices. The price could retest the 2019 high of 66.52 by June. The price could also fall back to 50 by the end of the year on supply concerns.

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