It’s a new year, people!

Another 12 months of exciting opportunities and chances to profit from the financial markets.
I have my technical hat on this evening with a mission to check out various trends using multiple time frame analysis (MTFA). This is a method of analysing long-term, medium-term, and short-term timeframes to achieve an accurate entry or exit when trading the markets.

Yesterday, we discussed how the monetary policy divergence between the Fed and ECB could influence the EURUSD’s outlook this year. On the monthly timeframe, the currency pair remains bearish as there have been consistently lower lows and lower highs. Prices have been trapped within a bearish channel since the start of 2021. However, zooming back all the way to 2013 we can see a bullish channel with strong support around 1.0900. A rebound from this point may encourage a move back towards 1.1400 and 1.1700. Should 1.0900 prove to be unreliable support, a decline back towards 1.0650 could be on the cards.

On the weekly charts, bears remain in the driving seat. A strong weekly close below 1.1400 could spark a selloff towards 1.1130.

Taking a look at the daily, support can be found at 1.1200 and resistance at 1.1370. A breakout could be on the horizon. It will be interesting to see how prices behave around 1.1370, a level where the 50-day Simple Moving Average (SMA) resides. If this level gives way, prices could jump towards 1.1530. Alternatively, a decline towards 1.1200 may signal a decline towards 1.1093.

GBPUSD...time for action?

The GBPUSD remains within a pretty wide range on the monthly charts with support at 1.3300 and resistance at 1.4250. Although bulls staged a strong rebound from the 1.3300 support last month, prices remain a bearish monthly channel. A move towards 1.4250 could become reality if a strong monthly close above 1.3800 is achieved. Should prices sink back under 1.3300, the next key point may be found at 1.2800.

Things are looking interesting on the weekly charts with bulls challenging the 1.3600 weekly resistance. A strong breakout above this point could encourage an incline towards 1.3900. If bulls are unable to crack this resistance, we could see a decline back towards 1.3200.

On the daily charts, prices remain bullish with 1.3600 acting as the first barrier for bulls to break down. Beyond this point, prices may jump towards 1.3700 which can be found below the 200-day Simple Moving Average. Given how there have been consistently higher highs and higher lows with the MACD trading above 0, bulls still have steam to push prices higher. However, if 1.3600 proves to be a tough nut to crack for bulls, the currency pair could decline back toward 1.3450.

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