Weekly Technical Analysis For December 16th to 20th, 2019 

All Eyes Will Be On The US GDP Growth And BoE Rate Decision 

EUR/USD:

The Federal Reserve kept interest rates on hold Wednesday, signaling that the current path of monetary policy was "appropriate" to support economic growth and would likely remain in place through next year.

The Fed maintained its outlook on U.S. economic growth, forecasting growth of 2.2% in 2019 and 2.0% in 2020. Growth for 2021 and 2021 was also left unchanged at 1.9% and 1.8% respectively. Its latest forecasts continued to point to a tight labor market, with the pace of inflation expected to improve next year, close to the Fed's 2% target.

U.S. President Donald Trump signed off on a trade deal with China that will delay a new round of tariffs scheduled for Dec. 15. China's Commerce Ministry said it has agreed with the U.S. on a text for a phase-1 trade deal that would see U.S. import tariffs on Chinese goods reduced in stages.

The European Central Bank kept monetary stimulus unchanged at President Christine Lagarde’s first policy meeting. Lagarde said she is different from her predecessor, Mario Draghi.

Looking ahead, the Eurozone Consumer Price Index will be closely watched next week. On the year-on-year basis, the Eurozone CPI is expected to be 1.0%. The core figure, without volatile energy and food prices, is expected to stay at 1.3%. A lower than expected reading will be negative for the single currency

Keep your eye on US GDP Growth on Friday. The US third-quarter gross domestic product is expected to see a growth of 2.1%, rising from the previous estimate of 2.0%.

The EURUSD pair closed last week above the support level of 1.1114. If the price stays above 1.1114, on a four hourly basis, the downward movement may pause and we will watch 1.1165 as resistance level again. On the downside, if the price drops below 1.1114, we will follow the next support level at 1.1052

Support : 1.1114 - 1.1052 - 1.0979 

Resistance : 1.1165 - 1.1237 - 1.1307

GBP/USD:

The GBPUSD pair jumped up just above the 1.3046 daily support level and moved up towards the 1.3517 main resistance level after a U.K. election exit poll suggested that Boris Johnson’s Conservative Party is projected to win the election.

The exit poll, which suggested UK Prime Minister Boris Johnson would get a majority of 86 - the largest of any Conservative leader since Margaret Thatcher won in the 1980s - should empower him to deliver Brexit on Jan. 31

Looking ahead, the Bank of England’s monetary policy committee will announce the results of its latest meeting on Thursday. The BoE is expected to leave interest rates unchanged again. There are expectations for clearer guidance towards lowering them in view of the global economic slowdown and the sustained deterioration in domestic conditions due to the endless uncertainty over Brexit.

Moreover, the UK Office for National Statistics will release data on consumer price inflation for November on Wednesday. Analysts expect annual CPI to come out at 1.4%, while core inflation is forecast to be 1.7%.

Keep your eye on the 1.3313 main level. If the pair stays above 1.3313 on a four hourly basis, the daily resistance level will be at 1.3392. In contrast, if the pair drops below 1.3313, the next daily support level can be found at 1.3231.
 
Support: 1.3313 - 1.3231 - 1.3136

Resistance : 1.3392 - 1.3517 - 1.3599

USD/JPY:  

We will closely watch the 109.39 main resistance level in the USDJPY pair. In order for the rise to continue, it needs to stay above 109.39 on a four hourly basis. At this point, we will face 109.72 as the next daily resistance level. Otherwise, we will follow the support level at 109.09 again.

Support : 108.52 -108.14 - 107.82

Resistance : 108.79 - 109.09 - 109.39

GOLD:

U.S. President Donald Trump approved a phase-one trade deal with China. The signing of the deal averts the planned introduction of new tariffs on Chinese goods.

The safe-haven, Gold price closed last week below the main resistance level of 1478. In order for the rise to gain more momentum, it needs to break out and stay above 1478 on a four hourly basis. Should this occur, the next resistance level can be seen at 1492. Otherwise, the support level can be found at 1466 again.

Support: 1466 - 1453 - 1440

Resistance: 1478 - 1492 - 1509

15 Dec 19 (Sun)

08:23 pm


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