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Daily Technical Insights 14th December 2023

  

Make informed decisions with the most up-to-date and reliable financial data, exclusively provided by vtmarkets.com.

Picks of the Day Analysis
EUR/USD (4 Hours)

EUR/USD Rallies Amid Fed’s Stance, Eyes on ECB Decision

The EUR/USD pair surged more than 100 pips post the Federal Reserve meeting, breaching the 1.0900 mark on a firmly bullish trajectory driven by the US Dollar’s dip. The Fed’s decision to maintain interest rates and the projection of future rate cuts in 2024 propelled US bond rallies, pushing the 10-year yield to 4% lows and the US Dollar Index down by nearly 1%. Ahead of the European Central Bank’s anticipated decision, expectations loom around unchanged rates, discussions on PEPP reinvestment, and updated projections, foreseeing potential downgrades in growth and inflation forecasts. Market sentiment appears dovish, factoring in a possible rate cut in April, pressuring the Euro. Attention shifts to the ECB’s stance for insights into future market repositioning, with the US Dollar’s decline potentially propelling a rally toward 1.1000, tempered by the ECB decision or Eurozone PMI reports.

Chart EUR/USD by TradingView

On Wednesday, the EUR/USD moved higher and was able to reach the upper band of the Bollinger Bands. Currently, the price moving slightly above the upper band, suggesting a potential continuation movement, potentially reaching the resistance level at 1.0925. Notably, the Relative Strength Index (RSI) maintains its position at 73, signaling a bullish outlook for this currency pair.

Resistance: 1.0925, 1.1005

Support: 1.0852, 1.0760

XAU/USD (4 Hours)

XAU/USD Surges Above $2,000 as Fed’s Dovish Tone Weakens Dollar and Treasury Yields

Gold (XAU/USD) soared past the $2,000 mark amidst the early Asian session, buoyed by a weaker US Dollar and declining Treasury yields following the Federal Reserve’s meeting. The Fed maintained interest rates unchanged, adopting a dovish stance on monetary policy. Fed Chair Jerome Powell hinted at potential rate cuts, contributing to the Dollar Index’s sharp decline and boosting gold prices. Despite market expectations aligning with the Fed’s decision, the possibility of rate cuts in 2024 exceeded forecasts, intensifying interest in gold. With upcoming US economic reports and Chinese data on the horizon, gold traders anticipate further cues from jobless claims, retail sales figures, and international economic indicators.

Chart XAU/USD by TradingView

On Wednesday, XAU/USD moved higher and was able to reach the upper band of the Bollinger Bands. Currently, the price moving slightly above the upper band, suggesting a potential continuation movement, potentially reaching the resistance level at $2,041. The Relative Strength Index (RSI) stands at 68, signaling a bullish outlook for this pair.

Resistance: $2,041, $2,068

Support: $2,008, $1,985

Make informed decisions with the most up-to-date and reliable financial data, exclusively provided by vtmarkets.com.

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