<p style=““ class=“text-align-justify“>That comes after a choppy and mixed day yesterday but overall, we are still seeing some key levels in play. The dollar is mostly little changed at the moment with only the pound slightly softer and the yen higher on the day.</p><p style=““ class=“text-align-justify“>EUR/USD is flat at 1.0885 with buyers still hoping to keep the upside momentum in a push above 1.0900 towards 1.1000. But with the Fed fast approaching, we might just see some room for a pause in the move for now. Meanwhile, GBP/USD is keeping just below 1.2400 as buyers are consolidating after a failed push above the December highs of 1.2443-46 at the start of the week.</p><p style=““ class=“text-align-justify“>The commodity currencies are flattish today as well but AUD/USD is holding above 0.7100 as buyers knock on the door of the August highs at 0.7125-36 still. NZD/USD is keeping just below 0.6500 as the figure level continues to provide a key point of resistance for any upside move on the daily chart.</p><p style=““ class=“text-align-justify“>USD/JPY is the only decent mover today but even so, the pair is just down 0.3% to 129.80 with the downside trend still very much intact:</p><p style=““ class=“text-align-justify“>The risk mood is looking more cautious so far today, so let’s see how that progresses once Wall Street steps in and if US PCE data has the potential to provide traders with a trigger for more meaningful moves later in the day.</p>

This article was written by Justin Low at www.forexlive.com.

<p>In terms of Russell 2000 technical analysis, the market is trading carefully
ahead of the FOMC meeting next week. The bulls had a good run recently ignoring
the deterioration in leading indicators like PMIs and focusing more on the
lagging ones like employment. </p><p>The labour market data keep on <a target=“_blank“ href=“https://www.forexlive.com/news/us-weekly-initial-jobless-claims-186k-vs-205k-expected-20230126/“ target=“_blank“ rel=“follow“>beating
expectations</a> with little sign of weakness. This, coupled
with <a target=“_blank“ href=“https://www.forexlive.com/news/us-december-cpi-65-yy-vs-65-expected-20230112/“ target=“_blank“ rel=“follow“>moderation
in inflation</a>, gave the market hopes for a “soft landing”
scenario where
inflation returns to its target without much damage in the economy and the Fed
can ease its monetary policy for a happily ever after ending. </p><p>That would be certainly an
unexpected and amazing outcome, but the signals from economic data are mixed
and the Fed is more likely to keep policy tight as long as the labour market
remains tight. Watch out for the next week events because not only we will
have the <a target=“_blank“ href=“https://www.forexlive.com/centralbank/wsj-fed-insider-says-its-open-market-committee-fomc-preparing-a-25bp-rate-hike-next-week-20230122/“ target=“_blank“ rel=“follow“>FOMC
Policy Decision</a>, but we will also get three major economic
reports: the two ISM PMIs and the NFP.</p><p>RUSSELL
2000 Technical Analysis</p><p>In the
daily chart above, we can see that the price is again at the <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“ target=“_blank“ rel=“follow“>resistance</a> at 1910-1920 zone. The market
hasn’t broken that resistance since September 2022, and it will need a good
catalyst for the bulls to manage a breakout and a rally to the next
resistance at 2030. </p><p>If the
market fails again and the sentiment turns sour, we may see the bears taking
control and possibly targeting the lows at 1630. The next week should be
decisive for the next move. </p><p>In the 1-hour chart above, we can
see how the <a target=“_blank“ href=“https://www.forexlive.com/news/us-december-retail-sales-11-vs-08-expected-20230118/“ target=“_blank“ rel=“follow“>big
miss in Retail Sales</a> data sent the market lower right from the
resistance before picking up again with a <a target=“_blank“ href=“https://www.forexlive.com/news/initial-us-jobless-claims-190k-versus-214k-estimate-20230119/“ target=“_blank“ rel=“follow“>beat
in Jobless Claims</a> data still showing a resilient labour market. </p><p>Russell 2000 Eyes Key US Data</p><p>Yesterday, although we got
another beat in economic data like <a target=“_blank“ href=“https://www.forexlive.com/news/us-q4-advance-gdp-29-vs-26-expected-20230126/“ target=“_blank“ rel=“follow“>Q4
GDP</a> and Jobless Claims, the market couldn’t break the
resistance. This may be a sign of cautiousness as the next week there are many
risk events like FOMC, ISM PMIs and NFP. It’s probably going to be choppy
heading into those events.</p><p>Zooming in to the 15 minutes
chart, we can see the near term price action with the market selling off right
at the stock market open and then recovering soon after. The 1903 level should
provide some support for the bulls, but the resistance zone at 1910-1920 has
been a tough one to crack. </p><p>If the 1903 <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“ target=“_blank“ rel=“follow“>support</a> gets breached, the bears should
target the next support level at 1886 with a possible continuation to
1862 if the market turns fearful. </p>

This article was written by ForexLive at www.forexlive.com.