Forex Fundamental And Technical Analysis.

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EUR/USD Weakens and GBP/USD Slides. - 13/12/2024​

INTRODUCTION​

Currency markets remain under pressure as major pairs navigate a challenging environment driven by monetary policy shifts, geopolitical risks, and economic data releases. The US Dollar (USD) continues to strengthen, exerting downward pressure on the Euro (EUR), British Pound (GBP), Japanese Yen (JPY), and Australian Dollar (AUD). Market focus now shifts to upcoming Federal Reserve and central bank meetings, which are expected to set the tone for the currency markets in the weeks ahead.

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EUR/USD Remains Fragile Near 1.0460​

The EUR/USD pair faces persistent bearish momentum, trading near a three-week low of 1.0455 during Friday’s Asian session. The pair’s decline is fueled by a dovish European Central Bank (ECB) stance and weak Eurozone economic performance. On Thursday, the ECB implemented its fourth rate cut this year, signaling potential further easing in 2025.

In contrast, expectations of a less dovish Federal Reserve (Fed) have supported the US Dollar. Rising US Treasury bond yields, which reached a new monthly high on Thursday, add to the USD’s strength. Geopolitical risks, including the Russia-Ukraine conflict and tensions in the Middle East, further bolster the greenback’s safe-haven appeal.

Key Factors Driving EUR/USD:​

• ECB Policy Divergence: ECB’s dovish outlook weighs on the Euro.
• US Treasury Yields: Higher yields sustain USD momentum.
• Geopolitical Risks: Safe-haven demand for USD pressures EUR.

Technical Analysis of EUR/USD:​

• Moving Averages:
  • Exponential: MA10: 1.0510 | Bearish
  • Simple: MA10: 1.0516 | Bearish
• RSI: 37.18 | Sell Zone
• Stochastic Oscillator: 30.42 | Neutral
• Resistance Levels: R1: 1.0846 | R2: 1.0988
• Support Levels: S1: 1.0384 | S2: 1.0242

Trade Suggestion:

• Sell Limit: 1.0529
• Take Profit: 1.0401
• Stop Loss: 1.0625

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GBP/USD Slides as Traders Await UK GDP Data​

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EUR/USD Struggles and GBP/USD Rebounds Amid Central Bank Focus. - 17/12/2024​

INTRODUCTION​

The currency markets are in focus as major currency pairs react to central bank policies, economic data, and geopolitical developments. Traders are particularly eyeing the Federal Reserve’s upcoming rate decision, which has broader implications for the U.S. Dollar (USD), while developments in Europe, the UK, New Zealand, and Canada add further volatility to the forex market. This article delves into key market movements, technical trends, and trade setups for EUR/USD, GBP/USD, NZD/USD, and USD/CAD.

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Markets in Focus: EUR/USD Struggles Below 1.0500​

EUR/USD continues to face challenges in gaining momentum, struggling to stay above the critical 1.0500 level. On Monday, the pair showed modest gains but lacked conviction, edging within a narrow range. While European December PMI figures exceeded expectations, the Services PMI remained in contraction, reflecting ongoing economic concerns in Europe.

The market’s primary focus remains on the Federal Reserve’s interest rate decision scheduled for Wednesday. According to the CME FedWatch Tool, markets have priced in a 99.1% probability of a 25-basis-point rate cut. Traders are keenly awaiting the Fed’s updated Summary of Economic Projections (SEP) and its dot plot for further clues on interest rate directions in 2025.

In contrast, U.S. economic data painted a mixed picture. Services PMI surged to multi-year highs, while Manufacturing PMI remained below 50, signaling continued contraction. Retail Sales data, due later today, may have a limited impact as the Fed meeting takes precedence.

EUR/USD Technical Overview:​

• Moving Averages (Exponential):
  • MA 10: 1.0514 – Negative Crossover – Bearish
  • MA 20: 1.0543 – Negative Crossover – Bearish
  • MA 50: 1.0659 – Negative Crossover – Bearish
• RSI: 42.47 – Neutral Zone
• Stochastic Oscillator: 33.26 – Sell Zone
• Resistance and Support Levels:
  • R1: 1.0846 | R2: 1.0988
  • S1: 1.0384 | S2: 1.0242

Overall Sentiment: Bearish
Market Direction: Sell
Trade Suggestion: Limit Sell: 1.0532 | Take Profit: 1.0474 | Stop Loss: 1.0575

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GBP/USD Rebounds as Traders Eye Key Central Bank Decisions​

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EUR/USD Struggles and GBP/USD Rebounds Amid Central Bank Focus. - 19/12/2024​

INTRODUCTION​

Major currency pairs remain under pressure as the US Dollar strengthens following the Federal Reserve’s hawkish rate cut. Traders now await key economic data, including US GDP and inflation figures, alongside central bank decisions in the UK, Eurozone, and Australia, which continue to shape market sentiment. This article delves into the market movements of EUR/USD, GBP/USD, AUD/USD, and USD/CAD, providing a detailed technical overview and trade suggestions to help investors navigate the evolving forex landscape.

EUR/USD Analysis​

Market Overview​

The EUR/USD pair remains under pressure, trading below the 1.0400 level, weighed down by the Federal Reserve’s hawkish stance on rate cuts. During Thursday’s Asian session, the pair dipped to around 1.0370 as the US Dollar strengthened.

Key Drivers​

• The Federal Reserve implemented a 25 basis point rate cut during its December meeting, reducing the benchmark lending rate to 4.25%-4.50%, the lowest in two years.
• Fed Chair Jerome Powell signaled a cautious approach to further rate reductions due to persistent inflation above the 2% target.
• In the Eurozone, expectations of aggressive ECB rate cuts through June 2025 continue to weigh on the Euro.

Technical Overview

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• Moving Averages: Negative crossovers for MA 10, MA 20, and MA 50 indicate a bearish trend.
• Indicators: RSI at 36.45 (sell zone); Stochastic Oscillator at 13.81 (neutral).
• Resistance Levels: R1: 1.0846, R2: 1.0988.
• Support Levels: S1: 1.0384, S2: 1.0242.

Trade Suggestion​

Limit Sell: 1.0440
Take Profit: 1.0332
Stop Loss: 1.0516

GBP/USD Analysis​

Market Overview​

The GBP/USD pair rebounds near 1.2590 during Thursday’s Asian session, recovering from a 1% decline following the Federal Reserve’s hawkish rate cut. Anticipation of the Bank of England’s steady interest rate decision further influences market sentiment.

Key Drivers​

• UK CPI rose by 2.6% YoY in November, while Core CPI increased to 3.5%.
• The Bank of England is expected to maintain its current interest rates, focusing on curbing high domestic inflation.
• The pair remains under pressure as traders await critical US economic data, including GDP figures and jobless claims.

Technical Overview

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• Moving Averages: Negative crossovers for MA 10, MA 20, and MA 50 reinforce bearish sentiment.
• Indicators: RSI at 41.64 (neutral); Stochastic Oscillator at 23.65 (neutral).
• Resistance Levels: R1: 1.2970, R2: 1.3102.
• Support Levels: S1: 1.2542, S2: 1.2410.

Trade Suggestion​

Limit Sell: 1.2624
Take Profit: 1.2485
Stop Loss: 1.2728

AUD/USD Analysis​

Market Overview​

The Australian Dollar stabilizes after trimming intraday losses during Thursday’s session. The AUD/USD pair remains under pressure due to the Federal Reserve’s hawkish stance and rising Consumer Inflation Expectations in Australia.

Key Drivers​

• The Fed’s 25 basis point rate cut bolstered the US Dollar.
• Australia’s Consumer Inflation Expectations rose to 4.2% in December, the highest since September.
• Market speculation on potential RBA rate cuts adds downward pressure on the AUD.

Technical Overview

• Moving Averages: Negative crossovers for MA 10, MA 20, and MA 50 confirm bearish momentum.
• Indicators: RSI at 27.59 (sell zone); Stochastic Oscillator at 4.73 (neutral).
• Resistance Levels: R1: 0.6641, R2: 0.6701.
• Support Levels: S1: 0.6447, S2: 0.6387.

Trade Suggestion​

Limit Sell: 0.6293
Take Profit: 0.6199
Stop Loss: 0.6366


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EUR/USD Consolidates and GBP/USD Subdued - 23/12/2024​

KEY HIGHLIGHTS ​

• EUR/USD Consolidates Amid Light Volumes, Focus on Fed.
• GBP/USD Subdued as Market Awaits Key Economic Data.
• USD/JPY Bullish Tone Supported by Fed’s Hawkish Stance.
• AUD/USD Declines, Focus Shifts to RBA Minutes.

INTRODUCTION​

Currency markets kicked off the week cautiously, with major pairs such as EUR/USD, GBP/USD, USD/JPY, and AUD/USD consolidating amid subdued trading volumes. Investors are focusing on central bank policies, economic data, and geopolitical developments to shape near-term price movements.

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EUR/USD: Consolidation Amid a Holiday-Shortened Week​

The EUR/USD pair remains steady, trading near 1.0440 during Monday’s European session. This consolidation comes as markets prepare for a holiday-shortened week, with Christmas Eve and Boxing Day affecting trading schedules on Wednesday and Thursday.

Key Factors Influencing EUR/USD​

• US Dollar Stabilization: After a steep decline on Friday due to weaker-than-expected US Personal Consumption Expenditure (PCE) Price Index data, the US Dollar (USD) has stabilized. Core PCE inflation, the Federal Reserve’s preferred metric, rose by 2.8% year-over-year, slightly below the 2.9% forecast. This has raised uncertainties about the Fed’s potential rate-cut cycle in 2025.
• Economic Calendar: Monday’s schedule is light, with investors turning their attention to Tuesday’s release of US Durable Goods Orders for November, expected to show a 0.4% decline after a 0.3% rise in October.

Technical Overview​

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• Moving Averages:
  • Exponential: MA10 (1.0446), MA20 (1.0491), MA50 (1.0619) – All indicating bearish momentum.
  • Simple: MA10 (1.0454), MA20 (1.0496), MA50 (1.0633) – Negative crossover confirming bearish trends.
• Indicators:
  • RSI: 38.87 (Sell Zone)
  • Stochastic Oscillator: 19.35 (Neutral)
• Key Levels:
  • Resistance: R1 (1.0846), R2 (1.0988)
  • Support: S1 (1.0384), S2 (1.0242)

Trade Suggestion​

Limit Sell: 1.0460 | Take Profit: 1.0344 | Stop Loss: 1.0548

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GBP/USD: Range-Bound with Limited Upside Potential​

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