This blog references an opinion and is for entertainment and informational purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.

In this special edition of the 69th Market Outlook here at Ostium Research, we'll be taking a look at the week ahead in markets, focusing specifically on Japanese-related markets (the 'Rising Sun'), looking at price-action, positioning and event risk for Gold, Silver, USD/JPY, Nikkei and AUD/USD.

Now, let's take a look at this week's relatively light calendar early on, which very swiftly grows busy into Thursday and Friday:

‍MONDAY: CHINA GDP (QOQ) (Q4): (CONSENSUS 1% VS PREVIOUS 1.1%)

‍TUESDAY: SNB CHAIRMAN SCHLEGEL SPEECH

WEDNESDAY: ECB PRESIDENT LAGARDE SPEECH

WEDNESDAY: PRESIDENT TRUMP SPEECH

THURSDAY: US INITIAL JOBLESS CLAIMS: (CONSENSUS 205K VS PREVIOUS 198K)

THURSDAY: US CORE PERSONAL CONSUMPTION EXPENDITURES (MOM) (NOV): (CONSENSUS 0.2% VS PREVIOUS N/A)

THURSDAY: JAPAN NATIONAL CPI EX FRESH FOOD (YOY) (DEC)): (CONSENSUS 2.4% VS PREVIOUS 3%)

FRIDAY: BOJ INTEREST RATE DECISION & PRESS CONFERENCE: (CONSENSUS N/A VS PREVIOUS 0.75%)

FRIDAY: ECB PRESIDENT LAGARDE SPEECH

FRIDAY: US S&P GLOBAL MANUFACTURING PMI (JAN): (CONSENSUS N/A VS PREVIOUS 51.8)

FRIDAY: US S&P GLOBAL SERVICES PMI (JAN): (CONSENSUS N/A VS PREVIOUS 52.5)

Now, let's dig into asset-specific price-action for the week ahead, looking firstly at Gold:

Gold:

Price: $4668

Weekly:

Beginning with the weekly for Gold, we can see that price is once again in price discovery, having bounced quite literally exactly where anticipated a few weeks ago - although, to be clear, I exited my Gold long just shy of $4500 - with no major fib resistance until we approach the big $5000 level. Weekly RSI is starting to form momentum divergence into highs, but AO is not, and as usual we should expect strong trends to invalidate these divergences, particularly when there is a structural bid beneath them. Nonetheless, it's worth keeping an eye on this as potential exhaustion, especially since we are now effectively one leg higher away from what is a huge psychological level. A pullback into prior highs at $4550 should act as support this week, where we would then get extension beyond $4700, but if instead we see price fail to hold that prior high and close back below $4550, that diverging RSI begins to look more notable.

Daily:

Turning to the daily, we can see that last week did see $4550 act as support and price gapped higher after the weekend into a fresh high at $4690. We have a low-liquidity trading environment today, but there is a lot that can move the market into the weekly close. I would look for a tactical long below that Friday low should we get it very early this week, bidding the monthly VWAP at $4517ish with a very tight stop on a daily close below the 30d rolling VWAP at $4479, looking for extension beyond $4715. As mentioned above, there is some chance that should we reject here, close back below $4550 and flip that confluence of prior highs, the monthly VWAP and the 30d rolling VWAP into resistance as we move into Friday, a multi-week top (at least) is forming. So, I don't really want to be holding exposure if that's how things begin to unfold, but I do like the R/R at the monthly VWAP and below last Friday's low for an attempt at continuation. Alternatively, I am looking for signs of exhaustion up near the 200% extension of the range above $4900, where I would be interested in shorts. There are no signs of exhaustion yet on the daily timeframe - but momentum is a little weaker already than the last leg higher and thus if we do get the weekly close below $4550, it is likely we see momentum rolling over too on this timeframe.

Silver:

Price: $93.24

‍Weekly:

Beginning with the weekly, we can see that much like Gold price gapped higher over the weekend to a marginal fresh high at $94.11, having closed last week up near $91, firmly above the prior all-time high at $84. Again, we have weekly momentum divergences building on RSI but not on AO - and for those that read the 'Metals Madness' post, you will also be aware that around $92.50 was where I was looking for signs of exhaustion to form, particularly given historic overextension from the 200wMA and a lack of the same structural bid that Gold has. Again, this does not mean blindly short, but the idea of taking fresh longs here is not remotely attractive to me. If we accept above $93ish and flip that into support, there is the possibility of another leg higher towards the major $100 level, with $111 as a confluence of fib levels beyond that. If we reject here at the marginal high, bears want to see a close back below last week's high, flipping that into resistance on the lower timeframes before shorts become viable. It's kind of no man's land for Silver - too overextended to jump in if you're sidelined, but too resemblant of a blow off top to put on naked shorts without tight invalidation.

Daily:

Looking at the daily, we can see the parabolic curve of the rally clearly, with the rally continuing to steepen over recent weeks, with price flipping prior resistances into support and continuing higher. Again, there is no sign of exhaustion just yet on this timeframe, but it could look that way depending on how price reacts this week at the fresh highs, where rejection and a close below $87 looks very bearish to me, from which we would be breaking that parabola and I would - at the very least - expect a retest of the 30d rolling VWAP at $79, but likely a much deeper multi-month correction and consolidation given the nature of the ascent and its historic overextension. Until then, and whilst $87 is holding as support, if we flip $93 early this week and push higher, that $98-$100 area is likely to prove troublesome on the first attempt. As mentioned above, through $100 we have $111 as a major fib level, but also $107 on the daily timeframe, which, looking at the steepness of the rally, should come within a week or so if the parabola does not break.

USD/JPY:

Price: ¥158.11

Weekly:

Beginning with the weekly for USDJPY, we can see that price is forming some trend exhaustion into long-term resistance here below 160, with momentum divergences on recent pushes through 157 towards the upper resistance zone. That 160.3 level is the lower bound of that zone, with 162.2 as the 2024 highs turned resistance, above which is clear air but where the pair has struggled for a long time. Given the existence of this momentum exhaustion at such a key area of resistance, we should be watching any signs of rejection here, where a break and close back below the 2026 open at 156.8, flipping that level into resistance, begins to look like a major top is forming, where that trend exhaustion would then need to unwind and likely send the pair back towards the confluence of trendline support, the 365d rolling VWAP, the anchored VWAP from the 2024 highs, the anchored VWAP from the 2025 low and prior resistance, all between 149-151. That's where USDJPY looks attractive again for another attempt at a breakout from this multi-year range. Now, should we fail to reject here and 160 be flipped into support, invalidating the weekly RSI divergences, then we can look for longs through 162, with no major resistance above that for several hundred pips.

Daily:

Dropping into the daily, we can see that daily structure and momentum are bullish here, with price having broken beyond local range resistance at 158, pushed into and above 159 last week and then rejected, now attempting to flip that range resistance into support, above the monthly VWAP and the 30d rolling VWAP. We could conceivably take a long here around this area with a stop on a daily close below 157.1, looking for 160.1, but I'd prefer to be out before BoJ later this week and I'd also want to long closer to the monthly VWAP (today's low) than right here at 158.1 for the highest R/R. I'll keep an eye on it today to see if something sets up, but technically it's a pretty classic resistance -> support flip in a bullish trend. Should we break and close below that 30d rolling VWAP and then reclaim 158 as range resistance, as mentioned above it begins to look a lot more like a local top is forming at multi-year resistance - and at the very least we would then expect the bottom of the range at 154.55 to be taken out.

Nikkei 225:

Price: ¥53,761

Weekly:

Looking firstly at the weekly for Nikkei, we can see that price has been - like most global equities - in a persistent uptrend since the April 2025 lows, marking out a local top at ¥52,600 a few months ago, correcting into ¥48,050, where it held prior resistance as support, and then continuing higher through Q4 into 2026, where we have formed a new all-time high at ¥54.634. Weekly momentum is still bullish, albeit with the potential for the formation of a divergence here should we reject, and structure is very much bullish, with no resistance overhead until the confluence of fib levels around ¥58,500ish. Should we accept above last week's high and continue higher, that is where I expect price to trade into in Q1, before that exhaustion begins to become more apparent. Should we instead find sellers here at last week's high, with price then flipping ¥52,600 back into resistance into February, we have the makings of a major top for the Nikkei, where we are likely to retest and sweep ¥48,000 from there at least, though more probable is a larger correction towards the 365d rolling VWAP and anchored VWAP from the tariff lows, between ¥42,000-¥43,000 sometime in Q2 - this all assumes we reject here, form weekly momentum exhaustion and then validate that divergence with a breakdown. Until then, higher.

Daily:

Turning to the daily, we can see that daily structure and daily momentum remain bullish here, as price retraces off that high last week into the January VWAP, 30d rolling VWAP and prior highs. I would actually be looking for a long early this week off that ¥52.6k level should we get it, as the first retest of prior highs as support, looking for ¥54.6k as the first target and then ¥58kish as the second target from there, with invalidation on a daily close below ¥50,500, though most probably looking to exit before that if we close the weekly below ¥52,600. This is a pretty nice setup for continuation here if we can get one more sweep of today's low into that demand zone, with an extremely clear invalidation, the loss of which also opens up a high probability environment for shorts for the subsequent weeks.

AUD/USD:

Price: $0.6697

Weekly:

If we begin with the weekly for AUD/USD, we can see that price has been in a downtrend since 2021, with lower-highs marked out by trendline resistance and by the anchored VWAP from that 2021 high at $0.802. Following the April 2025 volatility, Aussie marked out a low at $0.59, notably higher than the Covid low, then reclaimed support at $0.617 and has been grinding higher since, with the pair then forming a multi-month range between $0.66 as range resistance and $0.64 as range support, above which it has held for all of H2 2025. That level then acted as a spring for a move through multi-year trendline resistance a couple of months ago, with price flipping $0.66 and the trendline into support, then pushing into the anchored VWAP from that 2021 high at $0.677, where it rejected and is now consolidating between that level as resistance and $0.66 as resistance turned support. This is a pivotal area for AUDUSD, as every time we tag this anchored VWAP we seem to begin some sort of major correction over recent years, but for the first time during that trend we have broken above the trendline. Weekly momentum is moderately bullish and weekly structure is now bullish following the flip of $0.66 into support. So, if price rejects here and breaks back below $0.66, flipping it into reclaimed resistance, we could be in some trouble, with $0.646 as the last line of defense before a much larger correction, likely back into $0.617. If, however, Aussie can stick the landing here and hold support, then break and close above $0.677, this is a very different setup to prior occasions, and it would look very much like a long-term reversal is underway, perhaps akin to the post-Covid reversal, where I would then expect $0.716 to be tagged as resistance, but AUDUSD to ultimately move towards at least $0.75 in H1 2026.

Daily:

Turning finally to the daily for AUDUSD, we can see that there is some momentum exhaustion up here on RSI, but daily structure is still bullish with higher-highs and higher-lows, and if we sweep today's low into that anchored VWAP from the Nov low at $0.663, that could make for a high R/R long setup for another test of $0.677 and the potential breakout, with invalidation on a daily close below the swing-low at $0.659 (which is also prior range resistance). If we don't get that setup and we break higher from here, I would look for a lower timeframe pullback into $0.677 from above, with $0.688 as TP1, followed by $0.70 - but let's see how the next couple of weeks unfolds. Over recent years, seasonality has tended to favour Feb-July for Aussie strength.

I hope you've found some value in the read this week - please RT, share, engage etc. if so!

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