European Currencies Consolidate Near Key Extremes of the Year
There are only two full trading weeks left until the end of the year and just over a month until the inauguration of the 47th President of the United States. At the moment, the market is seeing flat trading in most currency pairs. However, since many macroeconomic news releases are expected this week, along with the final Fed meeting of the year, trends may either strengthen or change dramatically.
EUR/USD
For the past four weeks, the EUR/USD currency pair has been trading within the 1.04201.0620 range. Following the ECB's rate cut last week, the pair fell below 1.0500 but failed to update the November lows.
Technical analysis of EUR/USD points to a potential rise toward the upper boundary of the four-week range, as a bullish engulfing pattern has formed on the daily timeframe. If the pair manages to firmly break above 1.0620, it may target 1.06801.0700. A cancellation of the upward scenario could be considered if the pair moves below 1.0450.
Further clues for determining the direction of EUR/USD could come from the following events:
- Today at 12:00 (GMT+3): Germanys IFO Business Climate Index,
- Today at 13:00 (GMT+3): ECB member Frank Eldersons speech,
- Today at 13:00 (GMT+3): ZEW Economic Sentiment Index for the Eurozone.
GBP/USD
Last week, we saw a sharp decline in GBP/USD, triggered by buyers' inability to push the pair above 1.2800. The downward move slowed slightly above 1.2600, allowing for the formation of a bullish engulfing pattern on the daily timeframe. If confirmation of this pattern is received today, the price may retest 1.2800. A break of the 1.2600 support level could facilitate a renewed downward impulse toward 1.24901.2510.
Key events influencing GBP/USD pricing include:
- Today at 10:00 (GMT+3): Change in UK unemployment claims,
- Today at 10:00 (GMT+3): Average earnings (excluding bonuses) in the UK,
- Today at 16:30 (GMT+3): US Core Retail Sales report.
Read more: https://fxopen.com/blog/en/ru-european-currencies-consolidate-near-key-extremes-of-the-year/
Text source: Forex Trading Blog
