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EUR/USD is cycling near 1.1450 ahead of the European market session, catching some tentative lift as markets edge out some risk appetite in the post-holiday market run before New Year’s. Geopolitical concerns are once again at the forefront, with political turmoil in Europe, the UK, the US, and China all delivering a constant cycle of fear-inducing headlines as the US barrels towards an open trade war with China. Meanwhile US President Donald Trump blockades his own government seeking $5 billion in taxpayers’ money to build a border wall he swore on the election trail that Mexico would pay for, as well as taking potshots at his own pick for the head of the Federal Reserve Jerome Powell over Fed rate hike decisions. As of writing this article, the EURUSD pair is trading at 1.1456 up by 0.23% on the day.

German Data Key Macro Release of the Day

On the European side, Brexit proceedings has investors growing more nervous as the clock winds down, and the EU faces another round of deficit-busting with Italy defiantly thumbing their noses at the European Commission while France also seeks special treatment and an exclusion to overspend against their own government budget, outside of EU regulations. On release front today, European market sees low- and medium-tier economic data with key reading German CPI scheduled to release at 13:00 GMT. The key annualized preliminary CPI into December is forecast to come in at 1.9%, a slight decline from the previous period’s 2.3%.On the US side, the Chicago Purchasing Managers Index for December will be dropping at 14:45 GMT, followed closely by Pending and New Home Sales figures at 15:00 GMT.

When looking from technical perspective, the pair has been oscillating well within last week’s broader trading range and has now moved within striking distance of 100-day SMA important resistance. On a sustained move beyond the mentioned hurdle, currently near the 1.1475-80 region, the pair is likely to aim towards surpassing the key 1.1500 psychological mark and test 1.1515-20 supply zone, coinciding with 50% Fibonacci retracement level of the 1.1815-1.1216 downfall. On the flip side, any meaningful retracement now seems to find immediate support near the 1.1400 handle, below which the pair could head back towards testing 23.6% Fibonacci retracement level around mid-1.1300s. A follow-through selling has the potential to continue dragging the pair further towards challenging the 1.1300 round figure mark en-route the next major support near the 1.1265 horizontal zone.

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