Christmas Week Forex Forecast: 23 – 27/12/2019
How to use the basic technical analysis concepts we have shared with you to predict the next week’s currency pair price movement
EUR Rates Week in Review
Last week and for this trading week, our technical indicators suggested to short the EURUSD at 1.1140 and close it between 1.1020 and 1.0990, where at this levels, the currency pair will attract buyers. We also started to pay close attention to 1.1070 price level, key support because if we break it, there is a strong probability that the EURUSD will get between 1.1020 and 1.0990. As of 3:43 PM (GMT+0), the time I am writing this article, the EURUSD was trading at 1.1112. So far we are having a small gain on it and looks like we are getting the desired trend on the currency pair. However and throughout this week, there was a little opportunity for longs or shorts to capitalize on this currency pair.
The EUR/USD pair eased from a daily high of 1.1143 and nears 1.1108, its daily low, ahead of Wall Street’s opening. Major pairs are seeking a clear direction, with the dollar now strengthening in the short-term, although confined to tight and familiar ranges.
Risk-off took over the markets mid-London session, with safe-haven gold and yen up and US indexes poised to open lower. The ongoing political uncertainty, formed by a mixed bag of US-China trade deal uncertainty, fears of a hard Brexit, and Trump’s impeachment, fuels the dismal mood.
The EU macroeconomic calendar remained empty this Thursday, while the US has just published the Philly Fed Manufacturing Survey, down to 0.3 in December, far below the expected 8 and the previous 10.4, and weekly unemployment claims, which came in at 234K for the week ended December 13, worse than anticipated. Still pending of release are Existing Home Sales, foreseen down by 0.2% in November.
The EUR/USD pair remains vulnerable, trading between Fibonacci levels. The short-term picture, according to the 4-hour chart, indicates that the risk is skewed to the downside, as the pair is unable to recover above a flat 20 SMA, while technical indicators are retreating from their midlines, gaining bearish traction. Renewed selling pressure below 1.1110 could open the door for a steeper decline toward 1.1065, a strong static support level. Support levels are at 1.1110, 1.1090, and 1.1065. Resistance levels are at 1.1150, 1.1180, and 1.1220.
For next week and for the remaining of the year, we expect to see further consolidation on the EURUSD. The trading opportunity remains between 1.11775 and 1.0997. However and to diminish the trading risk for long/short positions, short-term traders should not keep the position open for more than two business days. As we stated last week if the EURUSD breaks 1.1070 price level, it would trigger a strong sell position, aiming to close the short position between 1.10 to 1.0996 or even 1.090. However, at 1.10, the EURUSD may attract new buyers, hence, we would prefer to close the short position on the currency pair at this price level and start a new long position between 1.10 and 1.0997.
EUR to USD forecast for tomorrow
Euro to Dollar forecast on Friday, December, 20: exchange rate 1.1082 Dollars, maximum 1.1248, minimum 1.0916. EUR to USD forecast on Monday, December, 23: exchange rate 1.1090 Dollars, maximum 1.1256, minimum 1.0924. Euro to Dollar forecast on Tuesday, December, 24: exchange rate 1.1119 Dollars, maximum 1.1286, minimum 1.0952. EUR to USD forecast on Wednesday, December, 25: exchange rate 1.1054 Dollars, maximum 1.1220, minimum 1.0888.
In 1 week Euro to Dollar forecast on Thursday, December, 26: exchange rate 1.1102 Dollars, maximum 1.1269, minimum 1.0935. EUR to USD forecast on Friday, December, 27: exchange rate 1.1142 Dollars, maximum 1.1309, minimum 1.0975. Euro to Dollar forecast on Monday, December, 30: exchange rate 1.1170 Dollars, maximum 1.1338, minimum 1.1002. EUR to USD forecast on Tuesday, December, 31: exchange rate 1.1172 Dollars, maximum 1.1340, minimum 1.1004. Euro to Dollar forecast on Wednesday, January, 1: exchange rate 1.1129 Dollars, maximum 1.1296, minimum 1.0962.
In 2 weeks EUR to USD forecast on Thursday, January, 2: exchange rate 1.1155 Dollars, maximum 1.1322, minimum 1.0988. Euro to Dollar forecast on Friday, January, 3: exchange rate 1.1153 Dollars, maximum 1.1320, minimum 1.0986. EUR to USD forecast on Monday, January, 6: exchange rate 1.1158 Dollars, maximum 1.1325, minimum 1.0991. Euro to Dollar forecast on Tuesday, January, 7: exchange rate 1.1219 Dollars, maximum 1.1387, minimum 1.1051. EUR to USD forecast on Wednesday, January, 8: exchange rate 1.1226 Dollars, maximum 1.1394, minimum 1.1058.
Again, remember to place stop losses, according to your risk tolerance as unexpected news coming to the market may significant affect trends and prices. Until next year’s article, we wish all of you a Merry Christmas and Prosperous New Year!
Disclosures: The material provided herein is for informational purposes only. It does not constitute an offer to sell or a solicitation of an offer to buy any interests in the EUR/USD or any other securities. Further, This overview may include or be based in part on projections, valuations, estimates and other financial data supplied by third parties, which has not been verified by Tony Ferreira nor KeySoft. Any information regarding projected or estimated investment returns are estimates only and should not be considered indicative of the actual results that may be realized or predictive of the performance of the EUR/USD or any underlying security. Past investment results of any underlying managers should not be viewed as indicative of future performance of the EUR/USD.