Home > Market Recap: GBP and AUD Strong Performers – Crude Oil Struggles at $60

Market Recap: GBP and AUD Strong Performers – Crude Oil Struggles at $60

The previous trading week ended with the dollar taking a dive across the FX dashboard. The weakness in the greenback was mostly seen against commodity currencies, as the higher commodity prices triggered ongoing strength in currencies such as the Australian dollar (AUD) or the Canadian dollar (CAD). 

GBP and AUS are the big winners of last week as the US fails to breach the $60 resistance barrier for Crude Oil.

The stock market futures in the United States point to a weaker opening, as they are down about 1% at the European opening. The weakness triggered a soft opening in Europe, as the Dax dropped well below 14,000, trading close to 13,800 at the time of this writing. Europe is yet to see the negative effects of the fiasco in its vaccination campaign, as other countries and economies are faring much better.

On the commodities front, the price of gold shows some strength in that it formed a falling wedge on the lower time frames – a possible reversal pattern, albeit the pressure to the downside remains on the bigger picture. Oil is the key to the dollar’s weakness, and its ability to remain above $60 is key for the rest of the trading week and month.

Daily Analysis

The day ahead is light in terms of economic events that might impact the markets. The IFO in Germany has long been viewed as a lagging indicator, thus not so relevant for the current environment. We do have the ECB’s President Lagarde speaking, and that may move the Euro pairs. The focus this week is on Fed’s Powell testimonies, Tuesday and Wednesday, and thus today, the market may just consolidate ahead of his remarks.

Markets to Watch

Oil, EURUSD, and USDJPY – key markets to watch today.

Crude Oil

The crude oil price found resistance above $60 and was unable to break it. Without a clear break of the area, chances are the market will correct to previous support given from a similar area on the left side of the chart.


The EURUSD pair bounced last week from a 61.8% retracement but was not able to make a new high. From an Elliott Waves perspective, the pattern resembles a flat with a double-failure, a pattern that signals counter-trend strength. It typically forms as the second wave in an impulsive move, so traders should stay alert and look for signs of weakness.


The USDJPY remains bullish while inside the rising channel. The market found support at the midpoint of the channel, and now the focus shifts to a new higher high. A rising trend consists of a series of higher highs and higher lows, and the USDJPY so far respected it. What is interesting about the USDJPY pair is the fact that its strength comes at a time when the dollar keeps falling.

Winners and Losers

The British pound (GBP) and the AUD remain the winners of the FX dashboard, as they closed at the highs last Friday. On the flip side, the JPY weakness shows no signs of a reversal.

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