Forex Trading Signals: EURUSD Outlook January 2014

In this analysis, we will examine EURUSD using basic technical analysis and the TCI model. At the end of this article, you’ll find the key news and events related to the Euro and the US Dollar for January 2014. But first, before diving deeper into the current Forex market conditions, let’s review our previous TCI signal on gold prices.

Previous TCI Signal on Gold Price

FOREX MARKET OUTLOOK JANUARY 2014 - EUR/USD

Currently, EUR/USD is trading at 1.3668. The euro recently recovered from five-week lows after comments by ECB President Mario Draghi. Historically, the euro tends to be weak against the US dollar in January. According to our research (2000-2013), the euro has averaged a -0.76% return versus the US dollar during January. In those 14 years, EUR/USD was bearish 8 times and bullish 6 times in January.

🔗 More » Check here TradingCenter Historical Research on EURUSD

Read more: Trading Signals: EURUSD Outlook January 2014

📶 Forex Trading Signals using Trading Center's Technical Analysis System (TCI)

🌐 EURUSD -The Euro against the US Dollar

Currently, EURUSD is trading at 1.34874, correcting from its recent high of 1.38314 reached on October 25, 2013. In two recent Forex Signal articles, we predicted that EURUSD would form a new mid-term high in late October, with the 23rd of October indicated as a possible date using TCI. In reality, EURUSD reached its high two days later, on October 25. Considering the forecast was made on October 13, this was a reasonably accurate prediction.

Using Price Action and TCI, we will now analyze what may happen next for EURUSD and AUDUSD.

📈 EURUSD Price Action

The current EURUSD price action is clearly bearish on both the H1 and H4 charts, with confirmation on the D1 chart as well. However, the longer-term charts, W1 and M1, still show a bullish channel that appears to be undergoing a correction.

It’s worth noting that November and December have historically been strong months for EURUSD. Based on daily data since 2000, here are some key statistics on EURUSD monthly returns:

■ November: +4.93% on average (7 bullish years ↑ and 6 bearish years ↓)

■ December: +20.7% on average (8 bullish years ↑ and 5 bearish years ↓)

Of course, these are just statistical trends and should not lead to hasty conclusions. Below is the TCI data table starting from October 18, including the forecast for the upcoming weeks.

Read more: Free Forex Trading Signals November 2013

📶 Forex Market is on the Move -TCI Forex Trading Signals GBPUSD and GBPJPY

In the past couple of weeks, volatility in the Foreign Exchange Market has skyrocketed. This is not unusual, considering we are entering December, which has historically been a highly volatile month over the last decade. Currently, the Forex market is experiencing very strong and extended trends, with the British Pound (GBP) leading the way. In particular, GBP is breaking through major resistance levels in pairs like GBPAUD and GBPJPY, surpassing barriers seen in recent years. Before diving deeper into these current trends, let’s review our last trading signal on EURUSD.

📄 Trading Center’s Previous Forex Trading Signal

It has been some time since our last Forex Trading Signal. At that time, we noted that EURUSD was trading bullish and likely to reach a new high. This did happen, although not within the timeframe we initially expected. Two key factors caused the delay: the ECB’s decision to lower Euro interest rates to 0.25%, and Standard & Poor’s downgrade of France’s credit rating from AAA to AA.

📈 Current Forex Trends – What Happens Next

Next, we will analyze the outlook for two major movers in the current market: GBPUSD and GBPJPY. The British Pound has been a clear leader recently,

Read more: Free Forex Trading Signals December 2013

📈 The Australian Dollar is on the Move -TCI Analysis

Recently, the Australian Dollar has shown strong movement against other major currencies. Using MT4 technical analysis and the Trading Center Indicator (TCI), we will examine whether this trend is likely to continue or if we are nearing its completion, indicating a possible reversal. But first, let's review our previous Forex analysis on EURUSD.

Evaluation of the Previous Forex Signal on EURUSD

On October 11th, we published an analysis of EURUSD. At that time, there was no clear trend, but we noted that the most probable scenario was a new regional high forming: “the most probable scenario is that EURUSD will try once more to form a new high (+8 trading days), and after that, a trend reversal (↓) is very probable to occur.”

In that article, we also identified two key EURUSD levels:

■ Bullish Trigger: 1.358

■ Bearish Trigger: 1.345

■ EURUSD at that time: 1.3541

The EURUSD bullish trigger level of 1.358 was reached, followed by a strong uptrend to 1.3703. Looking at the TCI indication table in that same article, we can see that TCI forecasted a regional high of +8 trading days. That places the high 8 trading days after October 11th—namely, Wednesday, October 23rd. That date is approaching, and we will soon be able to assess the accuracy of the TCI projection made on October 11th.

Read more: The Australian Dollar is on the Move 2013