Spreads
Spreads
Spreads
Spreads
Spreads
EURUSD (4-Hour Chart)
The EUR/USD pair advanced sharply on Monday, preserving its upside traction and clinched fresh multi-week peaks amid investors’ re-assessment of the potential next steps by the Federal Reserve when it comes to future interest rate hikes. The pair is now trading at 1.0747, posting a 1.03% gain daily. EUR/USD stays in the positive territory amid a weaker US Dollar across the board, as the risk appetite and lower US Treasury bond yields dragged the greenback to the lowest level since June 2022 near the 103.00 mark. The solid job creation alongside easing wage pressure both boosted speculations about a slowdown in the Fed rate hike cycle, favouring an increase of 25 basis points instead of 50 bps. The wage growth seems to have lost momentum, leading traders to start pricing in some probable pause in the Fed’s hiking cycle. In the Eurozone, the Unemployment Rate in the broader Euroland remained steady at 6.5% in November. The improving market mood also provided a boost to the EUR/USD pair as investors await comments from Fed officials.
For the technical aspect, RSI indicator 72 figures as of writing, suggesting the pair is now facing heavy bullish momentum as the RSI approached overbought readings. As for the Bollinger Bands, the price is moving alongside the upper band, therefore a continuation of the upside trend can be expected. In conclusion, we think the market will be bullish as the pair is heading to test the 1.0786 resistance level. Technical readings in the four-hour chart also skew the risk to the upside.
Resistance: 1.0786, 1.0921
Support: 1.0710, 1.0624, 1.0508
GBPUSD (4-Hour Chart)
GBP/USD advances on the soft US dollar index on Monday. Market participants now expect that the US Federal Reserve would slow down rate hikes as the US inflation report and employment report cause an upbeat market mood. On the other hand, UK politics and hawkish BoE commentary also lift the GBP/USD. UK Prime Minister Rishi Sunak said that inflation is not guaranteed to decline in 2022 and that the government would need to be disciplined to curb inflation, Reuter reported. BOE’s policy maker Catherine Mann said that Price caps on energy in response to a price surge following Russia’s invasion of Ukraine might be sparking inflation in other sectors by boosting consumer spending. At the time of writing, the GBP/USD is trading at 1.218.
For the technical aspect, RSI indicator 67 figures as of writing, suggesting that the pair is in bullish mode as the indicator keeps going up. For the Bolling Bands, the price is moving higher between the upward average and upper bound, signalling the recent upward trend. For the price action, the price broke through the first resistance at 1.2210 and is now testing the resistance at 1.2233. If the price closes above the current resistance on the 4H chart, it may head to test the pivotal resistance at 1.2450, which is also the highest since June 2022. In conclusion, we think GBPUSD is in a bullish mode based on the current market mood and the technical analysis.
Resistance: 1.2110, 1.2233, 1.2450
Support: 1.1927, 1.1765
XAUUSD (4-Hour Chart)
The broad US Dollar weakness pushed the gold price to $1,881 on Monday, its highest since June 2022. The Us dollar index fell on an upbeat market mood amid speculation that the federal reserve has room to slow down its pace of monetary tightening. On the other hand, China opened sea and land crossings with Hong Kong on Sunday and ended a requirement for incoming travellers to quarantine, which will positively influence global growth and lift the risk appetite. At the time of writing, gold price hold around $1,872.
For the technical aspect, RSI indicator 66 figures as of writing, holding close to the overbought zone, suggesting that the pair is in bullish mode. For the Bolling Bands, the price is moving up between the upward average and upper bound, which is a standard pattern for the upward trend. For the price action, the current pivotal support is at $1,830, which is also the critical price for bull-bear conversion. In conclusion, we think the gold price is in a bullish mode based on the current market mood and the technical analysis. On the downside, traders should aware of the critical level at $1,830. If the price drop below this level on the 4H chart, it may change the current trend.
Resistance: 1874, 1884
Support: 1830, 1775, 1735
