Pips for Breakfast: January 19, 2026

Trump is back to treating sovereign nations like fixer-uppers, and the Loonie is about to find out if inflation still has a pulse.

On This Day

Historically, mid-January is when the January Effect stops being a fun theory and starts being a headache for anyone who forgot to rebalance their portfolios. In previous years, this week has seen EUR/USD volatility spike as fund managers realize their New Year resolutions to be disciplined are harder to keep than they thought.

The Play

The Trade: Keep a close eye on USD/CAD at 08:30 UTC. We have a triple threat of CPI data hitting at once. Forecasters are looking for a significant drop to -0.4% in the monthly reading. If the numbers come in even colder than that, the Loonie will likely slide faster than a bobsled in Calgary. Shorting CAD against a resilient Greenback is the move if the data confirms a hard disinflationary trend.

What's on Deck

Canada's Big Moment: It is inflation day in the Great White North. The market expects the Trimmed and Median CPI to hold steady around 2.7%. Anything lower and the Bank of Canada might start looking at rate cuts with renewed interest. Stick around for the BOC Business Outlook Survey at 10:30 UTC to see if Canadian CEOs are as worried as their charts suggest.

The Trump Factor: Trump is threatening tariffs on the EU and the UK because they won't sell him Greenland. It sounds like a plot from a satirical HBO show, but the EUR/USD and GBP/USD are reacting like it is a serious fiscal policy. It is.

China's Split Personality: Factory output is accelerating, but retail sales and investment are lagging. It is a classic "making things but not buying them" situation. Watch AUD/USD for the fallout from the Q4 GDP slowdown. Even though China hit its 2025 growth target, the three-year low in GDP is a heavy anchor for the Aussie.

The Data Behind the Patterns View Packages →

Quick Pips

EUR/USD: Volatility is the theme of the day. Between tariff threats and fund rebalancing, don't expect a quiet session.
GBP/USD: Cable is caught in the crosshairs of the Greenland drama. Support levels are feeling fragile as the UK faces potential new trade barriers.
USD/JPY: If risk sentiment sours over the China data, the Yen might see some safe-haven love.
AUD/USD: The pair is struggling to find buyers after the lukewarm China data recap.

Why Your P&L Cares

The January Effect is that magical time of year when markets see increased volatility as funds finish their rebalancing. This creates erratic flows that often defy basic technical analysis. If you see a move that makes no sense today, it's probably a pension fund in London moving a few billion dollars because a spreadsheet told them to.

The current headlines about Greenland might feel like noise, but in 2026, noise is the new fundamental. We have seen this before. Back in 2018, a single tweet could move the Dow 500 points. Today, the threat of a trade war over a giant ice cube is enough to make the EUR/USD nervous. History shows that when political rhetoric gets weird, liquidity gets thin. Thin liquidity is how stops get hunted.

The Bottom Line

The Loonie is about to walk a tightrope, and Trump is trying to buy the rope. Watch the data, mind your stops, and remember that "unprecedented" is just the market's way of saying it forgot to read the history books. Now go make some pips. You're fed.