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Daily Technical Insights 23 December 2022


EURUSD (4-Hour Chart)

EURUSD traded 0.12% lower throughout Thursday’s trading. The recovering Dollar limited any upward momentum that the Euro exhibited during early Asia and European trading sessions on the 22nd. The better-than-expected U.S. GDP figure further eroded any upward mobility for the Euro. U.S. Q3 GDP came in at 3.2%, beating consensus estimates of 2.9%. The surprisingly higher U.S. GDP figure triggered interest rates and recessionary fears across markets. U.S. equities closed lower as short-term interest rate expectations once again climbed. The benchmark U.S. 10-year treasury yield rose above 3.68%, while the 2-year yield rose above 4.2%.

On the technical side, EURUSD has continued to trade below our previously estimated resistance level of 1.065. Short-term support for the pair remains at around the 1.0459 price region. EURUSD has been steadily consolidating around the 1.059 price region. RSI for the pair sits at 61.79, as of writing. On the four-hour chart, EURUSD currently trades below its 50-day SMA but above its 100 and 200-day SMA.

Resistance: 1.0650, 1.0695

Support: 1.0459, 1.0228

GBPUSD (4-Hour Chart)

The cable broke out of the coils and saw the next move towards 1.1900 and 1.1760. Greenback is being pursued as a higher prospect for Fed in 2023. GBPUSD is under pressure from a rally in the dollar, which is getting a boost from stronger-than-expected data, supporting the Fed’s hawkish outlook and higher interest rate expectations for 2023. DXY recovered to 104.5 from a low of 103.75 but remained well below 107.2, which is this month’s high. Ukrainian President Volodymyr Zelensky’s trip to the US and Russian President Putin’s readiness to increase the country’s military potential challenged risk appetite. On the other hand, China’s readiness for more stimulus measures and a second unscheduled bond purchase by the BoJ keep the Us stock still moderate buying the latest in the future.

On the technical side, GBP/USD extended its daily losses, falling below 1.2050. The pair struggled to stage a rally in the early US session after the dollar remained resilient against its rivals following better-than-expected Q3 GDP data, 1.9% compares to the forecast 2.4%. RSI for the pair sits at 34.12, as of writing. On the four-hour chart, GBPUSD currently trades below its 50 and 100-day SMA but above its 200-day SMA.

Resistance: 1.2320, 1.2600

Support: 1.19, 1.176

XAUUSD (4-Hour Chart)

The gold price hovers around at 1,812 to 1,820 area since the opening of the Q3 Final Gross Domestic Product and weekly Jobless Claims data released during the trading course yesterday. After the data was released the Q3 GDP was 3.2% which is 0.3% higher than the forecast 2.9%. This led the US dollar to rise nearly 0.5% to 104.50, as XAUUSD plunged immediately below 1,810 right away. As of writing, the current price fits at 1,787 and reaching a level under 1,800, the next estimated is 1,765. However, on the other hand, the pre-Christmas holiday mood is also set in, with liquidity thinning, which could also offer a helping hand to Gold buyers. Gold price’s technical setup on the daily chart also remains in favour of the optimists.

On the technical side, gold pressures intraday lows in the 1,795 price zone, further losing its bullish potential according to the daily chart but falling short of suggesting a steeper decline. For that, the pair would need to extend its current slump below 1,785, where 20 and 200-day SMAs coverage. In the near term, the risk is skewed to the downside. RSI for the precious metal sits at around 19.66, as of writing. On the four-hour chart, XAUUSD currently trades above its 5 to 200-day SMA.

Resistance: 1840

Support: 1777, 1765