📈 Market Analysis Report (Full)

Date: January 2, 2026
Key Condition: Thin liquidity due to multiple bank holidays (USD, JPY, CNY, CHF, NZD, CAD)
Source: Forex Factory

1) High-Impact News / Events (Last 24 Hours)

A) USD starts 2026 weaker after one of its worst years in ~8 years

Reuters reported that the US dollar opened 2026 “soft,” after the DXY fell around 9.4% throughout 2025 (its worst performance in 8 years), driven by narrowing interest rate spreads, expectations of rate cuts, and political uncertainty / Fed direction.

Trading Implications:
Short-term bias: USD tends to sell-on-rallies (especially versus EUR & gold), though price movement may be slow due to thin liquidity and partial Asia market holidays.

B) Global markets start 2026 “upbeat”, precious metals continue rally

Reuters: Early 2026 global equity markets are relatively positive under holiday-thin conditions.
Gold rose about 0.9% to around $4,351.70, supported by rate-cut expectations, geopolitics, central bank demand, and ETF inflows.

Trading Implications:
XAU/USD remains strong → buy-the-dip opportunities as long as intraday support holds.

C) Market focus shifts to US data (payrolls/jobless claims) & future Fed leadership dynamics

Reuters highlighted growing market attention toward US labor data and speculation around changes in Fed leadership (Powell’s term ends in May).
This keeps event-risk volatility elevated for USD during the early weeks of January.

2) Historical References (Similar Market Conditions)

A) Strong USD weakness year → early following year often sees continuation or consolidation

Reuters’ late-2025 narrative: DXY fell over 9% due to rate-cut bets and narrowing spreads.
Historically, after a major annual decline, markets often consolidate before resuming trend—if supported by data or central bank signals.

Commonly impacted instruments:

  • EUR/USD tends to stay bid during structural USD weakness

  • XAU/USD often outperforms when yields and USD weaken

B) Risk of Japanese intervention (key reference for USD/JPY)

On September 22, 2022, Japan intervened to support the yen; Reuters recorded a sharp yen spike following the first intervention since 1998.

Lesson for now:
If USD/JPY rises rapidly into “intervention-sensitive zones,” reversals can be sudden and violent intraday.

3) My Outlook (Based on Fundamentals + Current Market Structure)

Main Bias (Next 6–24 Hours)

USD: Mildly bearish / sell-on-rally

  • Reason: Weak start to 2026 + dominant 2025 narrative (rate cuts / interest differentials)

  • Probability: ~60% (reduced due to thin liquidity & holidays)

XAU/USD: Bullish (buy dips)

  • Reason: Precious metals momentum continues from 2025; Reuters confirms structural drivers (cuts, demand)

  • Probability: ~62%

EUR/USD: Mildly bullish, but range-bound

  • Reason: USD weakness, but many holidays + Europe’s key events are final PMIs (usually low impact unless major surprise)

  • Probability: ~57%

USD/JPY: Sideways–volatile

  • Reason: Yen remains sensitive to intervention narrative, but Japan markets are closed → reduced flows, spike risk remains

  • Probability: ~55% sideways

4) Intraday Update (Technical Levels & Execution Scenarios)

✅ EUR/USD (Intraday)

FXStreet (4H timeframe): price around 1.1760

  • Resistance: ~1.1774 (20-SMA 4H)

  • Dynamic Support: ~1.1727 (100-SMA 4H), 1.1658 (200-SMA 4H)

Trading Scenarios:

  • Bullish continuation: Break & hold above 1.1775 → potential retest toward 1.18

  • Buy-the-dip: While holding above 1.1725

  • Bearish invalidation: Breakdown below 1.1725 → risk toward 1.1660

Bias: Mildly bullish as long as 1.1725 holds (~57%)

✅ XAU/USD (Gold)

FXStreet: Gold rose to $4,345–$4,350 in Asia; previously dipped to $4,300 (profit-taking) before bids returned.

Key Levels:

  • Resistance: 4,350–4,365

  • Major Support: 4,300 (buy-the-dip zone)

Trading Scenarios:

  • Buy dips: Watch reactions at 4,300–4,320 for bullish rejection

  • Below 4,300: Watch for deeper flush (extended profit-taking)

Bias: Bullish (~62%), note wider spreads due to holidays

✅ USD/JPY (Intraday)

Reuters highlights yen remains near multi-month lows and previously triggered intervention concerns.

Today’s Character:
Better suited for scalping / range trading, not large swings (JPY bank holiday).

Execution Notes:

  • Range trading only: sell near resistance, buy near support (small position size)

  • Avoid chasing breakouts under thin liquidity

5) High-Impact Events Next 24 Hours (WIB) + Expected Impact

ForexFactory calendar uses Sydney time (GMT+11); WIB (GMT+7) = minus 4 hours.

Today – January 2, 2026 (Europe/UK releases remain):

Time (WIB) Event Forecast Previous Main Impact Bias
14:00 GBP Nationwide HPI m/m 0.1% 0.3% GBP pairs Mild GBP bearish if in-line/weaker
15:15 EUR Spanish Mfg PMI 51.2 51.5 EUR Mixed (needs surprise)
15:45 EUR Italian Mfg PMI 50.0 50.6 EUR Neutral
15:50 EUR French Final Mfg PMI 50.6 50.6 EUR Neutral
15:55 EUR German Final Mfg PMI 47.7 47.7 EUR Neutral
16:00 EUR Final Mfg PMI 49.2 49.2 EUR/USD Neutral
16:00 EUR M3 Money Supply y/y 2.7% 2.8% EUR Slightly bearish if weaker
16:00 EUR Private Loans y/y 2.8% 2.8% EUR Neutral
16:30 GBP Final Mfg PMI 51.2 51.2 GBP pairs Neutral

Important Note:
Many bank holidays → data reactions may be erratic: quick spikes followed by reversals.

6) Trading Plan Today (Concise & Execution-Focused)

Safest mode: Range / scalp with small lot sizes (holiday + thin liquidity)

Focus Pairs:

  • XAU/USD: Buy dips at 4,300–4,320 → target 4,350 (structure intact)

  • EUR/USD: Buy dips above 1.1725 or breakout above 1.1775 with confirmation

  • USD/JPY: Range only, avoid large swings

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