Forex headlines for January 17, 2014:

The euro broke the 100-day moving average for the first time since mid-November and barring a miracle, it will close below the mark for the first time since September. Bank of America said to sell EUR/USD on a break of 1.3550 and plenty of traders did just that. Rumors of a German sovereign downgrade and profit warning at Deutsche Bank helped. EUR/USD selling began the moment US traders arrived, knocking the pair through 1.3580 and from there it was a series of cascading stops that continued after Europe went home for the weekend. Low of 1.3517.

USD/JPY chopped sideways in a tight range from 104.20 to 104.45 — both inside yesterday’s US range.

Cable was the star of the show after the mighty retail sales report for December. There were plenty of eyebrows raised at the strength and that helped keep cable from extending beyond the post-data spike of 1.6459. That’s not the best sign and another negative signal came on a late day slump down to 1.6410. Still, it’s hard to imagine the pound falling unless the fundamentals begin to sag.

The week ends with another sad statistic for the Australian dollar. A hint of US dollar strength was all it needed to send AUD/USD below 0.8780 and a fresh cycle low at 0.8764. The sliver of good news was that it didn’t fall further.

The Canadian dollar finishes the week on its knees as well, with USD/CAD up to 1.0975. The Bank of Canada is the main event next week and many traders are betting they will be dovish.