EUR/USD and GBP/USD Price Forecast: Global Events and Manufacturing Data Impact

Highlights

• Saudi Arabia joins BRICS, potentially affecting EUR/USD and GBP/USD dynamics.
• EUR/USD influenced by mixed Eurozone manufacturing data; future outlook remains uncertain.
• GBP/USD shows stability, but global geopolitical shifts might increase volatility.
• Key data releases: German Unemployment Change, US ISM Manufacturing PMI to guide currency movements.
• FOMC Meeting Minutes, JOLTS Job Openings crucial for assessing USD impact on pairings.

Quick Fundamental’s Outlook

The fundamental analysis of the EUR/USD and GBP/USD pairs involves considering recent geopolitical and economic events. Saudi Arabia’s recent accession to the BRICS bloc, which now also includes the UAE, Egypt, Iran, and Ethiopia, may influence global economic dynamics, potentially impacting these currency pairs.

For the EUR/USD, data such as the Spanish, Italian, French, and German Manufacturing PMIs, and the Eurozone’s M3 Money Supply and Private Loans figures, suggest a mixed economic outlook in the Eurozone. Weaker manufacturing data could pressure the Euro, while any positive financial data might support it.

In the case of GBP/USD, the UK’s BRC Shop Price Index remaining stable and the Final Manufacturing PMI aligning with expectations indicate a steady economic scenario in the UK. However, global events, like the Saudi accession to BRICS, may introduce volatility to the pair.

Investors should also consider upcoming data releases like the German Unemployment Change, the US ISM Manufacturing PMI, JOLTS Job Openings, and ISM Manufacturing Prices, along with the FOMC Meeting Minutes, to gauge future movements of these pairs.

These indicators will provide insights into the economic health of both regions, influencing the EUR/USD and GBP/USD currency pairs.

EUR/USD Technical Outlook

As of January 3, the EUR/USD pair shows a modest uptick, trading at 1.09563 with a slight 0.04% increase. It orbits around a pivot point of $1.0936, facing resistance at $1.1005, $1.1068, and $1.1135, and support at $1.0885, $1.0813, and $1.0738.

The Relative Strength Index (RSI) at 34 indicates a bearish sentiment, leaning towards oversold conditions. Currently, the pair is trading just below its 50-Day Exponential Moving Average (EMA) of $1.1005, suggesting a short-term bearish trend.

However, an upward trendline around the pivot point could support a potential shift towards bullish momentum. The overall trend remains cautiously optimistic, with a bullish outlook above the $1.0936 mark.

GBP/USD Technical Outlook

On January 3, the GBP/USD pair exhibited a slight gain, trading at 1.2633, a 0.03% increase. The pair is navigating around a pivot point of 1.26121, facing immediate resistance at 1.26990, 1.27651, and 1.28275, while support levels are established at 1.25356, 1.24748, and 1.23983.

The Relative Strength Index (RSI) stands at 38, suggesting a bearish sentiment leaning towards oversold conditions. Notably, the pair trades below its 50-Day Exponential Moving Average (EMA) of 1.26962, indicating a short-term bearish trend.

However, an upward trendline near the pivot point could indicate a potential shift towards bullish momentum. The overall outlook for GBP/USD remains cautiously optimistic, leaning bullish above the pivot point of 1.26121.