General analysis EURUSD for 24.12.2021
24.12.2021 12:45
Недельный
Общий
Current Dynamics
Today is an official day off in the U.S. and the eurozone on the occasion of the Catholic Christmas celebration. The trading volume on the forex market is reduced and EURUSD is trading in a limited price range. Pressure on the dollar persists amid falling Treasury bond yields. At the same time the U.S. stock market continues to rise, despite strong U.S. macroeconomic statistics. The current dynamics is connected with the fact that the market participants doubt that the FRS will be able to realize its plans for the next year. At the moment, experts predict 2 key rate hikes with a total increase of 1.4% by 2024. At the same time, the Fed is going for 3 rounds of monetary tightening and by 2.1% increase in borrowing costs.
Omicron fears have eased a bit but continue to have a strong effect on the market. Also the next stimulus package worth $1.75 trillion may not pass through the Congress. The author of the bill is the U.S. president personally, while the initiative is blocked by his fellow centrist Senator Joe Manchin. If the bill does not pass through the Congress, the U.S. economy will slow down, GDP will slow down considerably in the first quarter of 2022 and the Fed will simply be unable to act aggressively.
At the same time, the eurozone economy is not stronger than the U.S. economy. The head of the ECB is still following the instructions of the International Monetary Fund, while many officials within the Committee are demanding a change of course. The regulator will keep QE until at least the end of fall 2022, and according to statements by Christine Laggarde, the central bank will not raise the rate until 2024. In the current situation Investizo does not believe in a long-term uptrend on EURUSD.
The nearest important macroeconomic event which may have a significant impact on the market's dynamics is the report on consumer confidence in the USA on Tuesday at 17:00 (GMT+2).
Support and resistance levels
On the 4-hour chart the instrument is strengthening in the upper range of Bollinger Bands. The indicator has reversed upwards and the price range remains unchanged, indicating a continuation of the uptrend. MACD histogram is in the positive zone, preserving a buy signal. Stochastic entered the overbought area, a strong sell signal is expected within 1-2 days.
Today is an official day off in the U.S. and the eurozone on the occasion of the Catholic Christmas celebration. The trading volume on the forex market is reduced and EURUSD is trading in a limited price range. Pressure on the dollar persists amid falling Treasury bond yields. At the same time the U.S. stock market continues to rise, despite strong U.S. macroeconomic statistics. The current dynamics is connected with the fact that the market participants doubt that the FRS will be able to realize its plans for the next year. At the moment, experts predict 2 key rate hikes with a total increase of 1.4% by 2024. At the same time, the Fed is going for 3 rounds of monetary tightening and by 2.1% increase in borrowing costs.
Omicron fears have eased a bit but continue to have a strong effect on the market. Also the next stimulus package worth $1.75 trillion may not pass through the Congress. The author of the bill is the U.S. president personally, while the initiative is blocked by his fellow centrist Senator Joe Manchin. If the bill does not pass through the Congress, the U.S. economy will slow down, GDP will slow down considerably in the first quarter of 2022 and the Fed will simply be unable to act aggressively.
At the same time, the eurozone economy is not stronger than the U.S. economy. The head of the ECB is still following the instructions of the International Monetary Fund, while many officials within the Committee are demanding a change of course. The regulator will keep QE until at least the end of fall 2022, and according to statements by Christine Laggarde, the central bank will not raise the rate until 2024. In the current situation Investizo does not believe in a long-term uptrend on EURUSD.
The nearest important macroeconomic event which may have a significant impact on the market's dynamics is the report on consumer confidence in the USA on Tuesday at 17:00 (GMT+2).
Support and resistance levels
On the 4-hour chart the instrument is strengthening in the upper range of Bollinger Bands. The indicator has reversed upwards and the price range remains unchanged, indicating a continuation of the uptrend. MACD histogram is in the positive zone, preserving a buy signal. Stochastic entered the overbought area, a strong sell signal is expected within 1-2 days.
- Support levels: 1.1185, 1.1220, 1.1265, 1.1315.
- Resistance levels: 1.1360, 1.1405, 1.1440, 1.1480.
- Long positions should be opened above the level of 1.1350 with a target of 1.1440 and a stop-loss at 1.1290. Implementation period: 1-3 days.
- Short positions can be opened below the level of 1.1300 with a target of 1.1235 and a stop-loss at the level of 1.1345. Implementation period: 1-3 days.