EUR/USD Mid-Session Technical Analysis for December 21, 2018

The EUR/USD is trading lower on Thursday shortly after the U.S. opening and ahead of a few U.S. economic reports. Investors will get the opportunity to react to a slew of economic reports including Final GDP, the Philadelphia Fed Manufacturing Index, Weekly Unemployment Claims, the Home Price Index and the Conference Board’s Leading Index.

Quarterly Final GDP is expected to come in unchanged from the previous report at 3.3%. A higher number should be bearish for the EUR/USD because this will indicate the economy is growing at a faster clip than expected. This could encourage the Fed to increase the frequency of its rate hikes in 2018.

Daily Technical Analysis

The main trend is up according to the daily swing chart. It turned up on Wednesday on the trade through 1.1862. The EUR/USD is currently posting an inside move. This indicates investor indecision and impending volatility.

A trade through 1.1901 will signal a resumption of the uptrend. This could create the upside momentum needed to challenge the next top at 1.1940.

The EUR/USD is also trading between a pair of Fibonacci levels at 1.1886 and 1.1855. Additional support is a pair of 50% levels at 1.1829 and 1.1823.

Daily Technical Forecast

Based on the early price action, the direction of the EUR/USD the rest of the session will be determined by trader reaction to the Fib level at 1.1855.

A sustained move over 1.1855 will indicate the presence of buyers. This level is part of a support cluster which includes 1.1856 and 1.1857.

Holding above 1.1857 will indicate the buying is getting stronger with 1.1870 the next target. This price is the trigger point for an acceleration into the major Fib level at 1.1886. Overtaking this level could drive the EUR/USD into 1.1901 then 1.1905.

A sustained move under 1.1855 will signal the presence of sellers. This move could trigger an acceleration to the downside with the next targets a pair of 50% levels at 1.1829 and 1.1823.

If 1.1823 fails then look for the selling to extend into 1.1796.